While the management expects to see a top-line contribution from FQ2'23 onwards, it remains to be seen if there may be a bottom-line contribution in the near term, due to the softer advertising market through 2024 and the operating costs involved.ĭespite RBLX's expanding recognized revenue to $655.34M (+13.1% QoQ/ +22% YoY), its COGS at $545.33M (+4.2% QoQ/ +28.5% YoY) and operating expenses at $399.87M (+11.7% QoQ/ +51% YoY) have expanded much faster, further suppressing its negative operating margins by the latest quarter.

While Unity ( U ) may have benefitted from the direct partnership deal with AAPL, boosting its top and bottom line expansion in 2023, RBLX's focus on gaming and virtual world building has less of an accretive impact to the Cupertino giant's next-generational computing device.įor now, RBLX has elected to launch a new advertising strategy in FQ1'23, as a way to diversify its top line while engaging with advertisers on the Metaverse platform. While the device may boost the demand for AR/VR devices and Metaverse application/ developers in the near term, going head to head with Meta's ( META) Quest series, it appears that RBLX has unfortunately been left out for now. Then again, its recovery has little to do with Apple's ( AAPL) launch of Vision Pro spatial headset. Well, hindsight appears to be 20/20, since the RBLX stock has already recorded an optimistic +26.20% recovery since then, thanks to the bottoming stock market in December 2022 and the better than expected FQ1'23 bookings. This was largely attributed to the uncertain metaverse outlook during the volatile macroeconomic environment then.

We previously covered Roblox Corporation ( NYSE: RBLX) in December 2022, ending with a Hold rating, given the supposed little catalyst for intermediate-term recovery. Klaus Vedfelt/DigitalVision via Getty Images The RBLX Investment Thesis Remains Highly Speculative

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