Roblox Inc. shares jumped more than 13% higher in Wednesday’s premarket action after the gaming company saw losses narrow and come in better than what analysts were modeling.
The company generated a third-quarter net loss of $277.2 million, or 45 cents a share, compared with a loss of $297.8 million, or 50 cents a share, in the year-earlier period. The FactSet consensus was for a 49-cent loss per share.
“slowed spending growth across most of our major expense categories,” Chief Financial Officer Michael Guthrie said in a release, leading to margin improvement on a sequential and year-over-year basis.
Revenue jumped to $713.2 million from $517.7 million, whereas analysts were looking for $700.5 million.
The company also reported $839.5 million in bookings, up 20% from a year before and ahead of the FactSet consensus, which was for $824.7 million. Roblox defines bookings as revenue plus the change in deferred revenue during the period, with some other non-cash adjustments. The company notes that bookings overwhelmingly reflect sales of virtual currency.
Average bookings per daily active user came in at $11.96, flat with the year-earlier total. The company had an average of 70.2 million daily active users in the third quarter, up 20% from a year prior and above the 69.6 million that analysts were projecting.
“While we continue to invest in innovation, we are now entering a new phase where we can slow the growth in operating expenses and capital expenditures, thereby generating operating leverage and free cash flow,” Guthrie said in the release.