Roblox Gamers Spend $773 Million on Virtual Currency Robux in Q1

Showing the potential upside of metaverse-like experiences, gaming platform Roblox reported strong growth in daily engagement and sales of its Robux in-game currency in the first quarter.

Roblox founder and CEO David Baszucki told analysts and investors during the company’s Q1 2023 earnings call Wednesday (May 10) that daily active users (DAUs) rose 22% to “an all-time high of 66 million DAUs,” adding that in terms of time spent on the platform, “hours are up 23% year-on-year, once again an all-time high of 14.5 billion hours of engagement in Q1.”

He also noted that the “13-and-up segment is growing 31% year-on-year, which bodes very well for our future growth” as those users are expected to generate more game time and in-game spending in the quarters — and years — to come.

Baszucki said the platform’s “Long-term mission is a billion users every day.”

In “bookings” — a term Roblox uses to represent sales of its Robux virtual currency used for in-game purchases — purchasing rose 23% to $773 million in the quarter. “Our bookings growth rate year-on-year over the last five quarters has gone from negative 3% to negative 4%, to plus 10%, to plus 17%, to plus 23%. We believe this is being driven by eight quarters of innovation and awesome engineering that have expanded our platform,” Baszucki said.

Playing With Platform Payments

In the company’s earnings press release, Roblox CFO Michael Guthrie said, “We also expect to see more of our bookings processed through credit cards and prepaid cards which will also have a positive impact on margins.”

Asked about the impacts of this, Baszucki told analysts that “our bookings year-on-year growth rate has already passed our cost of sales year-on-year growth rate because there are so many ways for our community to spend money on Roblox. They use prepaid cards. They can use credit cards. In addition, of course, to our partners like Google and Apple. And as that expands, we’re seeing the leverage we get as bookings grows faster than their cost of sales.”

Developers are making money too, creating games and experiences, and getting paid. Baszucki noted, “In March 2023, the number of developers who earned something on our platform grew 63% year-on-year to over four million. And the money to our community increased 24% year-on-year in Q1 to $182 million. There’s an enormous economic opportunity on Roblox, and we see that continuing to grow with a lot of developers moving to our platform.”

Roblox is also testing its in-platform advertising system, with more than 200 developers participating. The company gave no additional details on the ad system rollout aside from Baszucki saying, “We will make a small amount of advertising revenue in Q2 of this year.”

Voice and AI Take Bigger Roles at Roblox

The executives talked up platform tech, noting, for example, that voice is emerging strongly. Baszucki said that since the start of 2023, “voice on Roblox is now being used by almost 10% of over-13 daily users in the U.S.A., 9% to be exact. And we’ve rolled out lip-sync as well on our journey to fully animating avatars on the platform.”

This is part of Roblox’s vision of supporting “social communication” — a social media alternative — as Baszucki said, “People are finding 10% more real-life friends on the platform in the first seven days than they were a year ago.”

On the increasing use of artificial intelligence (AI), Roblox launched two AI-generative accelerators to assist creators, one being a material generator that allows developers to create any type of 3D material by describing it — tell it you want a brick wall covered with moss and the AI generates it — as well as code experiments that will “train a code generator that won’t just help people auto-complete, but really helps create and script on Roblox,” Baszucki said.