Roblox is going through accusations that it lied to traders concerning the quantity of people that use the platform. In a report revealed on Tuesday, the investment firm Hindenburg Research claims Roblox is “constantly overstating the quantity of individuals on its platform by 25 % to 42 % or extra.”
Roblox, which went public in 2021, reported having 79.5 million day by day lively customers in its most up-to-date earnings report. Nevertheless, Hindenburg claims Roblox “deliberately conflates” precise individuals with day by day customers, as that quantity may additionally embody alt accounts and bots. The analysis alleges that Roblox can separate alt accounts from single customers, regardless that the corporate’s disclosure says day by day lively customers “aren’t a measure of distinctive people accessing Roblox.”
“We completely reject the claims made within the report,” Desiree Fish, Roblox’s chief communications officer, stated in a press release to The Verge. “The monetary claims made by Hindenburg Analysis are merely deceptive. The authors are, admittedly quick sellers and have an agenda no matter the substance of Roblox’s enterprise mannequin and outcomes.” You possibly can learn the assertion in full on the backside of this text.
The agency additionally claims Roblox isn’t doing sufficient to guard youngsters on the platform, alleging its “in-game analysis revealed an X-rated pedophile hellscape, exposing youngsters to grooming, pornography, violent content material and intensely abusive speech.” Roblox shares dipped following the discharge of the report.
Final week, a monetary e-newsletter additionally accused Roblox of enabling child abuse. On the time, Roblox spokesperson Eric Porterfield denied claims that youngster endangerment is a widespread problem on the platform, saying it often updates its security practices to “catch and forestall malicious exercise.”
Right here’s Roblox’s full assertion:
We completely reject the claims made within the report. The monetary claims made by Hindenburg Analysis are merely deceptive. The authors are, admittedly quick sellers and have an agenda no matter the substance of Roblox’s enterprise mannequin and outcomes. Over the previous 4 quarters our bookings, the amount of money receipts, have grown over 22% from $780.7 million in Q2 2023 to $955.2 million in Q2 2024. Over the identical time, money offered by working actions have totaled $646.3 million, free money movement was $440.3 million, and we’ve got guided to even larger numbers for fiscal 2024. An examination of our GAAP steadiness sheet and our GAAP money movement assertion makes that clear. The concentrate on money bookings and money movement are themes that we’ve got targeted on constantly with traders courting again to our days as a non-public firm. The creator made no try to focus on any of that as a result of the constructive information merely don’t help their agenda.
Replace, October eighth: Added a press release from Roblox.