Two video game companies hoping to play a major role in the planned Metaverse – Roblox (RBLX) and Device software (tu) – Tuesday night delivered disappointing results for the first quarter. Both Metaverse shares fell on the news.
San Mateo, California-based Roblox, lost 27 cents per share on bookings of $ 631.2 million in the March quarter. Analysts surveyed by FactSet expected it would lose 22 cents per share on bookings of $ 655.7 million.
San Francisco-based Unity lost adjusted 8 cents per share on sales of $ 320.1 million in the first quarter. Wall Street had predicted a loss of 8 cents per share on a sale of $ 320.8 million.
Both companies are not profitable and are currently in investment mode.
Metaverse Stock Drop
In after-hours trading in the stock market today, both Metaverse shares fell. Roblox fell 3.5% to 22.38. Unity Software plunged 25% to 36. Both Metaverse shares have fallen sharply this year.
Roblox shares reached a record high of 141.60 on November 22nd. Unity stock reached its highest record of 210 on November 18th.
Roblox ranks 11th out of 22 shares in IBD’s video game software industry group, according to IBD’s Stock Check. It has a poor IBD composite rating of 11 out of 99. The composite rating assesses a stock’s most important growth indicators relative to all other stocks, regardless of industry group.
Unity shares rank ninth out of 12 shares in IBD’s design software industry group. It has an IBD composite rating of only 16, according to IBD’s Stock Check.
Create virtual worlds
With video game warehouses in landfills, Roblox and Unity position themselves as providers of tools and services to create the meta-verse. Metaverse is a future version of the Internet with immersive virtual 3D worlds that replace static 2D sites.
Roblox saw a healthy growth in the number of users and the use of its online video games and social platform in the March quarter. But bookings fell 3% year-on-year and missed estimates. In addition, he said that reservations fell by 8% to 10% year over year in April.
Roblox said it had 54.1 million average daily active users in the first quarter, up 28% from the same quarter last year. Hours committed to the service totaled $ 11.8 billion, an increase of 22%.
Unity Software, which offers a platform for creating and operating interactive 3D content in real time, missed the sights with its second-quarter and full-year sales forecast.
For the current quarter, Unity expected sales of $ 290 million to $ 295 million. Wall Street predicted $ 360 million. For the full year, Unity expects revenue of $ 1.35 billion to $ 1.425 billion. But analysts were looking for $ 1.5 billion in sales for 2022, FactSet said.
Other companies considered Metaverse shares include Facebook’s parent company Metaplatforms (Facebook), Microsoft (MSFT) and Nvidia (NVDA).
Follow Patrick Seitz on Twitter at @IBD_PSeitz for more stories on consumer technology, software and semiconductor stocks.
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