Roblox sees net losses for Q2 2021, struggles with toxic player-generated content

    
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We’ve got a bunch of Roblox news on deck today. First, there’s the Q2 2021 investor report. Readers will remember that in Q1, the company behind the game had just gone public and was just issuing its first earnings report, which was eye-opening, as it reported gross revenues of $387M but net losses of $134.2M. This quarter, the company hauled in $454.1M in gross revenues and a net loss of $140M. That’s… concerning, but once again, the company is reporting to stockholders that its engagement and daily active users are at their highest ever, which caused analysts to bump up their predictions for the stock.

Second, the company has acquired Guilded, which is a chat company we’ve covered that raised $7M from investors in 2020.

And finally, we come to the “this is why we can’t have nice things” portion of our report, as The Verge has a piece up on how Roblox players are using the game to construct re-enactments of scenes of mass murder, including the Christchurch shooting in 2019. Roblox says it has no tolerance for maps like that, but one Anti-Defamation League researcher keeps finding examples that have somehow made it through the moderation.

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Dobablo

People Make Games make a passing reference to Roblox’s constant “losses” in their “Roblox exploits child labour and pays developers less than 25% of the revenue spent on their games” video.

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bobfish

I like how converting Robux to Dollars also reduces the amount you receive. For every $1 spent on your “experience”, you can get $0.08 in your bank account.

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zoward

Losses in the hundreds of millions? Who would have guessed? I thought Roblox was a license to print money. So last year they spent $594 million in operating costs to make $454 million. What on earth were they spending their money on?

Turing fail
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Turing fail
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IronSalamander8 .

Many thoughts here.

First, I’ve never used Roblox but it’s always sounded like something that I would have loved as a kid. Not that I can’t love it now, but this is the kind of thing we lacked in the 70s and early 80s that my child self would have fallen in love with.

Second, I’ve seen YouTubers play it and it always seemed like it was popular so how are they losing so much money? I mean, it’s obviously possible to appear to be doing and be crashing and burning, but no idea why here.

Third, I gotta agree with Daniel Kelly here. I’ve seen all kinds of neat stuff people make with Roblox, like PvZ games and other fun stuff, but recreating mass shootings is awful and they need to do a better job keeping that kind of thing off the platform.

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Vanquesse V

My guess? As long as you’re growing your investors don’t really care about you making money. The more you grow, the less they care. Then, at the moment where roblox can’t get any bigger things turn around and the focus becomes trying to make as much money as possible on every single customer before they leave for good.

Roblox is already notorious for being full of greed, p2w, and some quite unethical approaches trying to get kids to beg for, spend real money on the game.

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Vanquesse V

IIRC Roblox hasn’t had a single quarter in the black since they launched in 2006, so a net loss right now is not too surprising.

Leo
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Leo

Since investors keep throwing money at them, maybe they could hire a few moderators, as it seems they lack any. Like if it’s that easy to find that horrible content over and over again and it keeps being brought to their attention…

Harry Koala
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Harry Koala

Don’t forget that the Lego online game got closed primarily because the cost of manual moderators to review later creations to catch inappropriate stuff was prohibitive. Keeping the game going was a choice between the game losing money, or Lego losing their child safe reputation. Unsurprisingly neither of these choices appealed, so they pulled the game.

Can’t see why it would go any different for Roblox to be honest.

Leo
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Leo

Well here though we have a specific situation. People are making content related to a mass shooting. They have done this in the past. This is not new. And still a person can just type in the name of that location and find new content of that mass shooting without even having to dig. It’s there, it’s not hidden.

This is something they have known about and not done really anything about.

Also they got into this business. We can’t just shrug our shoulders about hateful things being created so casually.