Roblox stock plummets on bigger-than-expected losses

Yahoo Finance Live looks at Roblox shares following its earnings report and data on daily active users.

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DAVE BRIGGS: All right, time now for our triple play. We all pick one stock in the news and on the move. Allie Canal joining us today for the conversation of those stocks. Disney, Upstart, and my play is Roblox shares tumbling today after the company reported a third quarter loss, but beat estimates for bookings revenue.

Roblox reported $58.8 million average daily active users. Now that's up 24% from a year earlier. The company said average bookings per daily active user was $11.94. That's down 11% year over year.

Like many in this sector, it is a COVID story. When many were stuck at home on their screens, bookings more than doubled. And Roblox's market cap neared $80 billion before peaking in November 2021. Shares, though, down about 67% so far this year. And you can see the fall today, more than 8% on this news, Allie.

ALEXANDRA CANAL: Yeah. And I think this is a story that we've been seeing with a lot of companies. If you're not performing on the bottom line, if your growth is slowing and you can't offset that with profits, you're going to get burned on Wall Street. And I think for a company like Roblox, investors have really wanted to see them start to make money. There's always been so much potential for this company, but the execution just hasn't been there.

I do think in 2023, things will improve. There are certainly a lot of momentum there, especially with bookings and daily active users growing at double digit rates. But investors need that proof that the company can get there. So it's just a wait-and-see approach at this point.