Roblox (NYSE:RBLX) stock is rallying 20% today. The surge comes after the company reported weaker-than-expected results for the first quarter yesterday.
Roblox is a platform and storefront for a variety of online games. In recent months, investors have come to see it as a bet on the metaverse. The company’s Q1 bookings came in at $631 million, versus an average estimate of $645 million. In more bad news, this bookings figure was down 3% year over year.
Roblox reported a per-share loss of 27 cents, worse than analysts’ mean estimate of a loss of 21 cents per share. Additionally, its loss from operations came in at $151.6 million, versus the $135 million loss from operations that it reported during the same period a year earlier.
RBLX Stock Recovers Despite Estimate Miss
On the positive side, the number of hours that consumers spent playing the company’s games jumped 22% year over year to 11.8 billion, and its average daily active users surged 28% YOY to 54.1 million.
“While Covid and the subsequent re-opening have contributed to slowing growth in several of our metrics, based on third party data we believe we are gaining share on both users and hours relative to certain other companies in gaming and social media,” Roblox stated in its shareholder letter.
The company also noted that the hours spent among its American users between the ages of 9 and 12 fell from the peak during U.S. lockdowns. However, it believes it can further engage this age group as well as cohorts of older users.
On the date of publication, Larry Ramer did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.