Is Roblox The Real Metaverse Play That We Should Be Investing In?

Roblox hit back with an earnings beat this week, sending shares to new all-time highs, but does the gaming platform have more room to run?

Who would have thought that little 3D box-shaped characters could be worth $50 billion? 

Investors will be singing their praises this week though after Roblox (NYSE: RBLX) reported blockbuster earnings, sending the shares up over 35% on Tuesday.

Just a kid’s game or a new social platform?

With everyone discussing Facebook’s (Meta) metaverse over the past couple of weeks, we might offend the guys over at Roblox. The company has been working on its own little metaverse for 17 years — and it has done fairly well, I might add.

That’s right, the Roblox platform is one of many homes for virtual gaming worlds for young folks, so Zuckerberg & Co. might want to start taking notes from these guys. 

While Roblox is sure to benefit from the metaverse’s newfound mainstream love, to get a better understanding of the company, we can compare it to YouTube. Roblox doesn’t make the games — instead, it relies on developers and creators to build new games for users to interact with, and rewards them in cold hard cash. 

This system is working too, as revenue soared 102% YoY to $509 million in Q3 and the number of hours engaged on the platform came in at a total of 11.2 billion — or 1.25 million years. 

But, a year ago, many of us had never heard of Roblox. However, with millions of views regularly for Roblox streamers, it’s now a big deal. Minecraft was a hit when I was growing up, and fast forward to now, my little nieces and nephews are still glued to it on their tablets.

Perhaps this could be Roblox too? It has a first-mover metaverse advantage, and as long as it innovates for its existing customers as they get older, and for the new customers joining, this could be the next big thing.

Read More