In the fierce competition for the gaming market, Roblox has engaged first and accelerated, moving ahead of Blizzard as of the most valuable gaming company in the US market. Roblox’s beat market estimates in its third-quarter results and saw a 28% rise in revenue to $637.8 million.
After presenting the results to the market, Roblox shares appreciated more than 40%, bringing the valuation to $62 billion. Blizzard is valued at US$52 billion.
The strong performance of Roblox, which operates one of the world’s most popular video game websites, was pulled by high demand for its “MeepCity” and “Adopt me!” video games. The company reported that daily active users reached 47.3 million people, a 31% jump in the third quarter. Gamers spent no less than 11.2 billion hours playing on the platform.
For CFRA Research analyst John Freeman, Roblox’s meteoric growth is related to the social media element of its video games and by the way, the platform allows for the construction of gaming experiences. In other words, Roblox allows the community of gamers to create a metaverse. Moreover, the company has hit the ground running and won over users by hosting virtual concerts of famous artists, such as rapper Lil Nas X.
Freeman concludes that, at this pace, the company “will not only be a revenue machine, but also a profit machine”.
Blizzard, until now the most valuable game company in the United States, presented its third-quarter results amid a huge crisis. Although better than expected by analysts – net revenue of $2.07 billion, up 5.9 percent year on year – the company’s shares plummeted 15 percent soon after the report was released.
Among the bad news for Blizzard is the decision to postpone the release of two hit games, Diablo IV and Overwatch 2. In addition, the company is facing a series of allegations of sexual harassment and gender discrimination, which has resulted in the dismissal of more than 20 employees and the opening of internal investigations.