Quarterly Report — Q2 2024
Filed August 2, 2024
Revenue grew solidly year-over-year in Q2 2024, but the company remains deeply unprofitable — net losses continued to pile up through the first half, with accumulated deficit widening against a backdrop of heavy stock-based compensation across every expense category. The U.S. and Canada still dominate the revenue mix at roughly half of sales, while durable virtual items drive the bulk of revenue recognition. Cash reserves remain substantial with a diversified investment portfolio, but the $1 billion in unsecured 3.875% notes due 2030 keeps the balance sheet leveraged as management bets on long-term platform growth outpacing persistent operating losses.
Filing details
Performance by segment
Roblox Platform
Roblox operates as a single reportable segment — its unified immersive platform for connection and communication. Revenue grew 31% YoY to $893.5 million in Q2 2024, driven by higher amortization of prior period deferred revenue (aided by a paying user life estimate decrease from 28 to 27 months) and bookings growth to $955.2 million (up 22% YoY). DAUs reached 79.5 million in Q2 2024, hours engaged hit 17.4 billion, and average daily unique paying users grew from ~790,000 to ~983,000 YoY, though the company still posted a net loss of $205.9 million for the quarter.
“Our mission is to connect a billion users with optimism and civility. We are constantly improving the ways in which our Platform supports shared experiences, ranging from how these experiences are built by an engaged community of developers and creators to how they are enjoyed and safely accessed by users across the globe.”
Infrastructure and Trust & Safety
Infrastructure and trust & safety expenses declined 2% YoY to $221.1 million in Q2 2024, despite supporting a growing user base. The decrease was primarily driven by a $7.8 million reduction in moderation and customer support costs due to AI-driven efficiency gains and automation, plus a $6.0 million decline in data center and hosting costs. For the six months ended June 30, 2024, these expenses grew only 3% YoY to $448.0 million, demonstrating operating leverage.
“We have been investing in AI and automation to increase the accuracy and efficiency of our safety moderation and customer support related efforts, which has increased the quality of our safety and civility systems and led to a decrease in safety moderation and customer support costs in recent periods.”
Developer Exchange Fees
Developer exchange fees — representing amounts earned by creators on the platform — grew 26% YoY to $208.3 million in Q2 2024 and 18% YoY to $410.7 million for the first half. Growth exceeded bookings growth in Q2 partly due to Easter holiday timing shifting prepaid card redemptions into Q2 2024. Over 20,000 developers and creators were qualified for the Developer Exchange Program as of June 30, 2024.
“Over the next few years, a major goal is to increase our developer and creator earnings (i) by creating new earnings methods and enhancing existing ones and (ii) through efficiencies realized in other areas of our business, while maintaining reasonable margins.”
Advertising
Roblox disclosed that advertising and licensing revenue remains an "insignificant amount" within total bookings and revenue but signaled it as a strategic growth priority. The company plans to invest in and expand its advertising business for the foreseeable future, including immersive ads integrated into developer experiences and brand partnerships.
“We plan to invest in and expand our advertising business for the foreseeable future.”
Research and Development
R&D expenses grew 15% YoY to $361.7 million in Q2 2024 and 22% YoY to $723.7 million for the first half, driven by a $32.8 million increase in stock-based compensation and headcount growth supporting engineering, design, and product teams. The company is investing in high fidelity avatars, more realistic experiences, AI tools, and social features.
“We are continually innovating our Platform by investing in high fidelity avatars, more realistic experiences, artificial intelligence ('AI') tools, and other social features.”
Console and Device Expansion
Roblox continued expanding across platforms including PlayStation, with console users now reported in their respective geographies starting Q4 2023. The filing notes that Xbox users represented less than 2% of total quarterly DAUs and hours engaged since Q4 2020, while the company highlighted its dependence on Apple App Store (30% of Q2 2024 revenue) and Google Play Store (16% of Q2 2024 revenue) as key distribution channels.