Roblox reaches $ 42 billion after its stock rose 50% upon listing
Online games company Roblox shares rose 52% within minutes of its long-awaited listing, raising the company's market value by about 50% compared to its last valuation in January.
Direct insertion
- The shares were listed on the New York Stock Exchange, and they began trading around 1:30 pm EST, rising almost instantly, reaching $ 68 a share, up from the $ 45 reference price for the stock that was set on Tuesday.
- The share price rise pushed the company's market value to nearly $ 44.3 billion, compared to its most recent valuation of $ 29.5 billion after the last private financing round in January.
- Roblox, which operates out of San Mateo, California, was originally planning an initial public offering (IPO) last year, but volatile market conditions led it to opt for a direct listing, which does not guarantee the issuance of new shares, and instead allows existing shareholders to sell a portion of their stakes, she said. The company listed about 199 million shares on Wednesday out of 652 million outstanding shares.
- Billionaire and CEO David Basuki founded the company in 2004, which allows users to design and build their own games online, and gives creators a share of the revenue generated by their games (players can purchase digital trinkets such as avatars and other items).
- The company's revenues rose 82% last year, to reach $ 923.9 million amid epidemic-fueled growth, but its net losses also increased, with the company's total losses amounting to $ 257.7 million in 2020, compared to a loss of $ 71 million in 2019.
- The broader market also saw a rally on Wednesday, after a series of losses in technology stocks that lasted for weeks, as the S&P 500 index rose 0.7% and the Dow Jones Industrial Average by 1.2% at the time Roblox debuted.
Connect the world
Basuki tweeted Wednesday morning: “We founded Roblox in 2004, with a vision to connect the world. Today, as we celebrate our direct listing on the New York Stock Exchange, we recognize the potential that lies ahead: building a platform where billions of people come together to learn, work and play.”
Deferred IPO Plans
Roblox was expected to go public at the end of last year, joining the likes of Airbnb, DoorDash and C3.ai of billionaire Thomas Sybil in a series of public market debuts at the end of the year, making December one of the biggest A number of public offerings on the date of the month. But the company backed off plans, citing concerns about an increasingly volatile market / making the offering price difficult to determine. Instead, it decided to list it outright in February, but those plans were also delayed after the US Securities and Exchange Commission audited the company's revenue.
Expected growth
Roblox does not expect this year to be strong compared to 2020 despite the new liquidity in the market. The company's chief financial officer, Michael Guthrie, said in a statement earlier this month: “We have entered 2020 with strong organic growth underpinned by social distancing restrictions. With the easing of these restrictions, we expect that growth rates in 2021 will be much lower than the rates we have seen in 2020. However, we believe that we will see positive growth in most of our key metrics for the full year. "
Wide spread
The company expects to reach 36.4 million daily active users by the end of this year, up 12% from its figures at the end of 2020. The company says that two-thirds of children in the United States between the ages of 9 and 12 use its platform.