Roblox says revenue was higher than reported, pushes listing for March

Roblox, the children’s games company that is preparing to go public, released an updated prospectus on Thursday with updated financial information due to a “material weakness” in its reports. Revenue for the first three quarters of 2020 was higher than previously reported, while its net loss was less.

Revenue through September increased by 70% over the previous year, to $ 613.9 million, the company said. In his previous prospectus in mid-January, Roblox said that revenue for that stretch rose 68% to $ 588.7 million. Its revised net loss for the period was $ 194.5 million, down from the $ 213.3 million reported before.

“We identified a material weakness in our internal control over financial reporting that resulted in our redesign of our financial statements for the years ended December 31, 2018 and December 31, 2019 and the nine months ended September 30, 2020”, said the document. .

The disclosure comes after Reuters reported in late January that the company postponed its stock market debut because the SEC was examining the company’s method of recognizing revenue through its digital currency. In the story, Reuters quoted a memo sent to employees.

Roblox said it now expects its direct listing to take place in March, instead of February, as indicated in a previous deposit. Roblox originally planned to go public through a traditional IPO in December, but postponed its debut for the first time and switched to a direct listing after Doordash and Airbnb priced their IPOs well below where the shares opened.

Roblox, which has one of the highest grossing apps on Apple and Google devices, makes money by allowing its millions of users to buy a virtual currency called Robux, which can be used to dress up your avatar or advance in games.

The company said the financial correction was related to how and when it counts Robux purchases as revenue, rather than leaving it as deferred revenue.

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