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Roblox is the biggest game in the world, but is unprofitable

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Re: Roblox is the biggest game in the world, but is unprofitable

#61

Post by treyd »

jrm4 wrote: post #18

There's something weird and sad about Roblox for me as an old-timer who still has silly dreams about free/open software internet utopias for just fun? There's so much creative (programming etc) energy in that place and, for what? short rant over

I've had this half-idea for recreating something like Garry's Mod in Godot for a while now. It seems like something someone would have created by now but it doesn't exist yet for whatever reason.

Like, a framework for building first-person FPS-ish game modes and handling all the asset management, sync, etc, like GMod being built around Source does and just letting developers build the game modes without worrying about the annoying tricky stuff.

Re: Roblox is the biggest game in the world, but is unprofitable

#62

Post by Aeolun »

So the real reason they’re not profitable is because they’re doing some accounting magic that counts their income spread over the next 27 month, instead of all up front. They are cash flow positive, it’s just that their income numbers are lagging some 2 years behind.

Re: Roblox is the biggest game in the world, but is unprofitable

#63

Post by Guzba »

wavemode wrote: post #4

> Though Roblox isn’t profitable, there are some significant caveats to the situation. Over the last twelve months, operating cash flow—a far more important measure than accounting-defined profits—were $650MM, about 20% of revenue. Roblox has been cash-positive for at least twenty-four quarters. This feels like an example of the phenomenon highlighted in another recent post: https://news.ycombinator.com/item?id=41263…

Roblox is dilution-maxxing, stock based comp is up 10x since EOY 2020 whereas revenue is only up 3x. SBC is also ~ 1/3 of revenue.

It's pretty cool to get shareholders to pay your employees so you can be called "operating cash flow positive" as if their comp isn't an expense.

Re: Roblox is the biggest game in the world, but is unprofitable

#64

Post by Aeolun »

TulliusCicero wrote: post #53
jrm4 wrote: post #18

There's something weird and sad about Roblox for me as an old-timer who still has silly dreams about free/open software internet utopias for just fun? There's so much creative (programming etc) energy in that place and, for what? short rant over

In a lot of ways it reminds me of BW/War3 custom maps.

Sorta, except that everyone is racing for money.

Re: Roblox is the biggest game in the world, but is unprofitable

#65

Post by Aeolun »

TulliusCicero wrote: post #52
bentcorner wrote: post #25

In my (non-finance, parent of a roblox-player) opinion, the problem that Roblox has is that every single roblox game has a "roblox" essence. Every roblox game is undeniably roblox, and to broaden their market and attract higher-paying users, I think they need to fix that. There's a certain amount of jank in every roblox game, and that's part of the charm. But it's undoubtedly also a reason why people with fatter wall…

Hard agree on the jank, but it may not be possible to fix that while keeping the upsides of the platform.

I don’t think there’s anything inherent in Roblox that means the characters have to look and be animated like janky robots.

Re: Roblox is the biggest game in the world, but is unprofitable

#66

Post by raister »

Roblox is a huge problem for me, as a parent of a 8y kid. Let me explain: I try to block violent apps in his tablet using Google's Family app, however, Roblox internally keeps 'offering' my kid almost any game, whatever if there's violence, drugs, killing others, and so forth.

It's a headache and a source of fights, so, I thank the responsible (/sarcasm).

Re: Roblox is the biggest game in the world, but is unprofitable

#67

Post by bemmu »

bentcorner wrote: post #25

In my (non-finance, parent of a roblox-player) opinion, the problem that Roblox has is that every single roblox game has a "roblox" essence. Every roblox game is undeniably roblox, and to broaden their market and attract higher-paying users, I think they need to fix that. There's a certain amount of jank in every roblox game, and that's part of the charm. But it's undoubtedly also a reason why people with fatter wall…

I'm a dev on the platform and agree that there is a lot of jank in Roblox games.

There's some indication of more polish coming, as recently many games have been rewarded (Pressure, Shovelware's Brain Game etc.) from having more polished animations. Devs respond quickly to seeing other games succeed and take notes. The tools are also getting better. It's gradually getting less nightmarish to try to import a working skeletal animation from Blender to Roblox Studio.

Could Roblox games benefit from more polish? Absolutely, but it's less important than having quick access to a high variety of games with consistency in how you play them.

Perhaps the most massive benefit of jank-tolerance is that it lets devs "gradient descent" towards a game players want. If you released a janky proto on Steam, you'd miss your shot, get an "overall negative" review and be done. On Roblox you can release a janky proto, see its metrics, improve over time until you have something people want.

Re: Roblox is the biggest game in the world, but is unprofitable

#68

Post by staticautomatic »

Guzba wrote: post #63
wavemode wrote: post #4

> Though Roblox isn’t profitable, there are some significant caveats to the situation. Over the last twelve months, operating cash flow—a far more important measure than accounting-defined profits—were $650MM, about 20% of revenue. Roblox has been cash-positive for at least twenty-four quarters. This feels like an example of the phenomenon highlighted in another recent post: https://news.ycombinator.com/item?id=41263…

Roblox is dilution-maxxing, stock based comp is up 10x since EOY 2020 whereas revenue is only up 3x. SBC is also ~ 1/3 of revenue. It's pretty cool to get shareholders to pay your employees so you can be called "operating cash flow positive" as if their comp isn't an expense.

IDK about the stock but I’ve interviewed there and their cash comp is legit FU money. Am I misunderstanding you?

Re: Roblox is the biggest game in the world, but is unprofitable

#69

Post by Quothling »

raister wrote: post #66

Roblox is a huge problem for me, as a parent of a 8y kid. Let me explain: I try to block violent apps in his tablet using Google's Family app, however, Roblox internally keeps 'offering' my kid almost any game, whatever if there's violence, drugs, killing others, and so forth. It's a headache and a source of fights, so, I thank the responsible (/sarcasm).

Roblox really needs to create some better parental controls so that it includes the option for a parent to be required to "ok" what they call "new experiences". The various limits you can set on content are great in theory, but they are apparently impossible for Roblox to enforce and as such are meaningless.

I do like Roblox from a creator perspective (I'm not a creator) since it's rather easy to guide your children into building games rather than "just" consuming them. Something which is very hard with basically everything else they do digitally.

Re: Roblox is the biggest game in the world, but is unprofitable

#70

Post by doctorpangloss »

TheRealPomax wrote: post #6

This feels like reading finance fan fiction (which it kind of is, given the author's profession?) and uses a lot of text to reach the part that lays out the actual problem: the average operating costs based on daily active users are $18 per user per quarter, and the average amount made is only $13. so either operating costs need to come down, charges need to go up, or they need (more, stable) external revenue (e.g. a…

You’re right. What else? Roblox games absolutely utterly suck. Little else matters.
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