Roblox Corp 10-Q for FY2021 Q2

Roblox Corp (RBLX)

10-Q 2021-08-16 For: 2021-06-30

Added on April 09, 2026

About this 10-Q

Roblox Corp filed this 10-Q on August 16, 2021, covering the quarter ended June 30, 2021 (FY2021 Q2).

Headline figures

Quarter ended June 30, 2021, as reported in this filing, compared with the same period a year earlier where the filing states it.

Revenue: $454.1M; up 126.6% from $200.39M a year earlier
Net loss: $140.13M; compared with a net loss of $71.52M a year earlier
Diluted EPS: -$0.25; compared with -$0.40 a year earlier

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Delaware						20-0991664
(State or other jurisdiction of incorporation or organization)						(I.R.S. Employer Identification No.)


Special Note Regarding Forward-Looking Statements
Special Note Regarding User Metrics and Other Data

		Page
PART I.	FINANCIAL INFORMATION
Item 1.	Financial Statements (Unaudited)	4
	Condensed Consolidated Balance Sheets	4
	Condensed Consolidated Statements of Operations	5
	Condensed Consolidated Statements of Comprehensive Income (Loss)	6
	Condensed Consolidated Statements of Convertible Preferred Stock and Stockholders’ Equity (Deficit)	7
	Condensed Consolidated Statements of Cash Flows	9
	Notes to Unaudited Condensed Consolidated Financial Statements	10
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	31
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	46
Item 4.	Controls and Procedures	48
PART II.	OTHER INFORMATION
Item 1.	Legal Proceedings	50
Item 1A.	Risk Factors	50
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	87
Item 3.	Defaults Upon Senior Securities	87
Item 4.	Mine Safety Disclosures	87
Item 5.	Other Information	87
Item 6.	Exhibits	88
Signatures		89


	As of
	June 30, 2021		December 31, 2020
Assets
Current assets:
Cash and cash equivalents	$	1,780,262	$	893,943
Accounts receivable—net of allowances	217,010		246,986
Prepaid expenses and other current assets	45,432		26,274
Deferred cost of revenue, current portion	351,573		256,928
Total current assets	2,394,277		1,424,131
Property and equipment—net	218,581		206,415
Operating lease right-of-use assets	228,232		—
Deferred cost of revenue, long-term	127,011		113,793
Intangible assets, net	38,079		42,326
Goodwill	59,568		59,568
Other assets	8,043		1,567
Total assets	$	3,073,791	$	1,847,800
Liabilities, Convertible Preferred Stock, and Stockholders’ Equity (Deficit)
Current liabilities:
Accounts payable	$	11,112	$	12,012
Accrued expenses and other current liabilities	182,084		65,392
Developer exchange liability	90,615		80,912
Deferred revenue—current portion	1,488,200		1,070,230
Total current liabilities	1,772,011		1,228,546
Deferred revenue—net of current portion	551,665		484,699
Operating lease liabilities	206,376		—
Other long-term liabilities	1,700		22,109
Total liabilities	2,531,752		1,735,354
Commitments and contingencies (Note 11)
Convertible Preferred Stock
Convertible preferred stock, Series A, B, C, D, D-1, E, F, and G $0.0001 par value, zero and 349,522 shares authorized as of June 30, 2021, and December 31, 2020, respectively; zero and 337,235 shares issued and outstanding as of June 30, 2021, and December 31, 2020, respectively; aggregate liquidation preference of zero and $335,654 as of June 30, 2021, and December 31, 2020, respectively	—		344,827
Stockholders’ Equity (Deficit)
Preferred stock; $0.0001 par value per share; 100,000 and zero shares authorized as of June 30, 2021 and December 31, 2020, respectively; zero shares issued and outstanding as of June 30, 2021 and December 31, 2020, respectively	—		—
Common stock, $0.0001 par value; 5,000,000 and 740,000 authorized as of June 30, 2021, and December 31, 2020, respectively, 574,595 and 201,327 shares issued and outstanding as of June 30, 2021, and December 31, 2020, respectively; Class A common stock—4,935,000 and 675,000 shares authorized as of June 30, 2021, and December 31, 2020, respectively; 521,008 and 144,039 shares issued and outstanding as of June 30, 2021, and December 31, 2020, respectively; Class B common stock—65,000 shares authorized as of June 30, 2021, and December 31, 2020, respectively, 53,587 and 57,287 shares issued and outstanding as of June 30, 2021, and December 31, 2020, respectively	57		20
Additional paid-in capital	1,293,160		239,792
Accumulated other comprehensive income	114		90
Accumulated deficit	(766,641)		(492,290)
Total Roblox Corporation stockholders’ equity (deficit)	526,690		(252,388)
Noncontrolling interests	15,349		20,007
Total stockholders’ equity (deficit)	542,039		(232,381)
Total liabilities, convertible preferred stock, and stockholders’ equity (deficit)	$	3,073,791	$	1,847,800


	Three Months Ended June 30,				Six Months Ended June 30,
	2021		2020		2021		2020
Revenue	$	454,100	$	200,392	$	841,076	$	361,962
Cost and expenses:
Cost of revenue(1)	116,930		53,669		214,867		95,462
Developer exchange fees	129,714		85,052		248,652		129,551
Infrastructure and trust & safety	108,986		61,853		203,122		114,473
Research and development	124,748		40,249		221,392		89,658
General and administrative	97,678		18,707		192,053		49,265
Sales and marketing	18,990		13,908		38,992		29,565
Total cost and expenses	597,046		273,438		1,119,078		507,974
Loss from operations	(142,946)		(73,046)		(278,002)		(146,012)
Interest income	26		294		31		1,541
Other income/(expense), net	10		494		(1,040)		(2,663)
Loss before provision for income taxes	(142,910)		(72,258)		(279,011)		(147,134)
Provision for income taxes	20		5		22		6
Consolidated net loss	(142,930)		(72,263)		(279,033)		(147,140)
Net loss attributable to the noncontrolling interest	(2,796)		(742)		(4,682)		(1,240)
Net loss attributable to common stockholders	$	(140,134)	$	(71,521)	$	(274,351)	$	(145,900)
Net loss per share attributable to common stockholders, basic and diluted	$	(0.25)	$	(0.40)	$	(0.63)	$	(0.83)
Weighted-average shares used in computing net loss per share attributable to common stockholders—basic and diluted	571,300		180,336		432,159		174,939


	Three Months Ended June 30,				Six Months Ended June 30,
	2021		2020		2021		2020
Consolidated Net loss	$	(142,930)	$	(72,263)	$	(279,033)	$	(147,140)
Other comprehensive income/(loss):
Foreign currency translation adjustments	48		(1)		48		(1)
Net change in unrealized gains (loss) on available-for-sale marketable securities, net of tax	—		(157)		—		59
Other comprehensive income/(loss), net of tax	48		(158)		48		58
Total comprehensive loss including noncontrolling interests	(142,882)		(72,421)		(278,985)		(147,082)
Less: net loss attributable to noncontrolling interests	(2,796)		(742)		(4,682)		(1,240)
Less: cumulative translation adjustments attributable to noncontrolling interests	24		—		24		—
Total comprehensive loss attributable to noncontrolling interests	(2,772)		(742)		(4,658)		(1,240)
Total comprehensive loss attributable to common stockholders	$	(140,110)	$	(71,679)	$	(274,327)	$	(145,842)


☒			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934


☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934


	Convertible Preferred Stock			Class A and Class B Common Stock			Additional Paid-In Capital		Accumulated Other Comprehensive (Loss) Income		Accumulated Deficit		Non- controlling Interest		Total Stockholders’ Deficit
	Shares	Amount		Shares	Amount
Balance at March 31, 2021	—	$	—	568,894	$	57	$	1,199,833	$	90	$	(626,507)	$	18,121	$	591,594
Issuance of common stock upon exercises of stock options	—	—		5,696	—		11,668		—		—		—		11,668
Stock- based compensation	—	—		—	—		81,659		—		—		—		81,659
Release of restricted stock units	—	—		4	—		—		—		—		—		—
Others	—	—		1	—		—		—		—		—		—
Cumulative translation adjustments	—	—		—	—		—		24		—		24		48
Net loss	—	—		—	—		—		—		(140,134)		(2,796)		(142,930)
Balance at June 30, 2021	—	—		574,595	$	57	$	1,293,160	$	114	$	(766,641)	$	15,349	$	542,039


	Six Months Ended June 30
	2021		2020
Cash flows from operating activities:
Consolidated net loss	$	(279,033)	$	(147,140)
Adjustments to reconcile net loss including noncontrolling interests to net cash provided by operations:
Depreciation and amortization	34,410		18,852
Stock-based compensation expense	132,403		49,666
Change in fair value of warrants	—		1,890
Operating lease non-cash expense	20,544		—
Other non-cash charges/(credits)	16		1,721
Changes in operating assets and liabilities:
Accounts receivable	29,960		(84,119)
Accounts payable	2,313		(988)
Prepaid expenses and other current assets	(27,264)		(6,835)
Other assets	(6,476)		1,392
Developer exchange liability	9,703		25,155
Accrued expenses and other current liabilities	74,129		9,834
Other long-term liability	584		1,836
Operating lease liabilities	(12,642)		—
Deferred revenue	484,936		384,303
Deferred cost of revenue	(107,863)		(95,442)
Net cash provided by operating activities	355,720		160,125
Cash flows from investing activities:
Acquisition of property and equipment	(45,368)		(26,249)
Purchases of short-term investments	—		(5,991)
Maturities of short-term investments	—		36,000
Purchases of intangible assets	(256)		(579)
Net cash (used in)/provided by investing activities	(45,624)		3,181
Cash flows from financing activities:
Proceeds from issuance of preferred stock for warrant exercises	—		147
Proceeds from issuance of common stock	41,889		5,996
Net proceeds from issuance of preferred stock	534,286		149,669
Net cash provided by financing activities	576,175		155,812
Effect of exchange rate changes on cash and cash equivalents	48		(3)
Net increase in cash and cash equivalents	886,319		319,115
Cash and cash equivalents
Beginning of period	893,943		301,493
End of period	$	1,780,262	$	620,608
Supplemental disclosure of cash flow information:
Cash paid for interest	—		—
Cash paid for income taxes	—		—
Supplemental disclosure of noncash investing and financing activities:
Property and equipment additions in accounts payable and accrued expenses	$	10,820	$	16,343
Conversion of convertible preferred stock to common stock upon direct listing	$	879,113	—


	As Reported Balance as of December 31, 2020		Adjustments due to Topic 842		As Adjusted Balance as of January 1, 2021
Assets
Operating lease right-of-use assets	—		$	195,944	$	195,944
Prepaid expenses and other current assets	26,274		(8,106)		18,168
Total	$	26,274	$	187,838	$	214,112
Liabilities
Accrued expenses and other current liabilities	$	65,392	$	(1,704)	$	63,688
Other long-term liabilities	22,109		(21,983)		126
Operating lease liabilities—short-term	—		32,162		32,162
Operating lease liabilities—long-term	—		179,363		179,363
Total	$	87,501	$	187,838	$	275,339



Remainder of 2021	$	26,944
2022	55,855
2023	50,220
2024	41,414
2025	34,860
Thereafter	78,423
Total lease payments	$	287,716
Less: interest(1)	36,000
Present value of lease liabilities	$	251,716



Weighted average remaining lease term	6.22
Weighted average discount rate	4.0		%
Cash paid for amounts included in the measurement of lease liabilities(1)	$	25,141
Lease liabilities arising from obtaining new ROU assets	$	53,554



2021	$	51,397
2022	54,477
2023	47,915
2024	38,970
2025	32,223
Thereafter	55,882
Total lease payments	$	280,864



	Fair Value
Cash paid	$	45,998
Common stock issued	35,203
Replacement awards attributable to pre-acquisition service	5,493
Total purchase price	$	86,694


	December 11, 2020
Cash and cash equivalents	$	5,080
Prepaid expenses and other current assets	45
Goodwill	59,568
Identified intangible asset—developed technology	29,000
Deferred tax liabilities	(6,681)
Accrued expenses and other current liabilities	(318)
Total purchase price	$	86,694


(Mark One)


	Three Months Ended June 30,
	2021				2020
	Amount		Percentage of Revenue		Amount		Percentage of Revenue
United States and Canada (1)	$	309,203	68	%	$	139,769	70	%
Europe	85,042		19		36,021		18
Asia-Pacific, including Australia and New Zealand	33,050		7		15,263		8
Rest of world	26,805		6		9,339		4
Total	$	454,100	100	%	$	200,392	100	%


	Six Months Ended June 30,
	2021				2020
	Amount		Percentage of Revenue		Amount		Percentage of Revenue
United States and Canada (1)	$	573,711	68	%	$	252,417	70	%
Europe	157,644		19		64,441		18
Asia-Pacific, including Australia and New Zealand	61,362		7		27,957		8
Rest of world	48,359		6		17,147		4
Total	$	841,076	100	%	$	361,962	100	%


	As of June 30, 2021
	Gross Carrying Amount		Accumulated Amortization	Net Carrying Amount		Weighted Average Remaining Useful Life (in Years)
Intangible assets with finite lives
Developed Technology	$	42,959	(5,454)	$	37,505	4.4
Total Intangible Assets	$	42,959	(5,454)	$	37,505


	Carrying Amount
Balance as of December 31, 2020	$	59,568
Addition from acquisition	—
Balance as of June 30, 2021	$	59,568


	As of December 31, 2020
	Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount		Weighted Average Remaining Useful Life (in Years)
Intangible assets with finite lives
Developed Technology	$	42,959	$	(1,206)	$	41,753	4.9
Total Intangible Assets	$	42,959	$	(1,206)	$	41,753



Remainder of 2021	$	4,248
2022	8,495
2023	8,495
2024	8,401
2025	7,866
Thereafter	—
Total remaining amortization	$	37,505


	As of,
	June 30, 2021		December 31, 2020
Prepaid Expenses	$	40,207	$	17,606
Other current assets	5,225		8,668
Total prepaid expenses and other current assets	$	45,432	$	26,274


Series	Shares		Per share price at issuance		Per share conversion price		Aggregate Liquidation Preference		Carrying Value of Preferred
	Authorized	Outstanding
A	28,000	16,358	$	0.02	$	0.02	$	327	$	313
B	45,532	45,532	$	0.03	$	0.03	1,070		1,054
C	95,290	95,290	$	0.03	$	0.03	2,935		4,150
D	54,860	54,215	$	0.04	$	0.04	2,150		2,097
D-1	44,706	44,706	$	0.09	$	0.09	4,172		12,998
E	24,340	24,340	$	1.03	$	1.03	25,000		24,906
F	33,149	33,149	$	4.53	$	4.53	150,000		149,640
G	23,645	23,645	$	6.34	$	6.34	150,000		149,669
H	12,222	11,889	$	45.0	$	45.0	535,000		534,286
Total	361,744	349,124					$	870,654	$	879,113


	Options Outstanding
	Number of Shares Subject to Options	Weighted- Average Exercise Price		Remaining Contractual Term (Years)	Aggregate Intrinsic Value
	(in thousands)				(in thousands)
Balances as of December 31, 2020	98,502	$	2.55	7.76	$	3,838,994
Granted	—	—
Cancelled	(1,119)	$	3.88
Exercised	(24,139)	$	1.73
Balances as of June 30, 2021	73,244	$	2.79	7.46	$	6,385,925
Exercisable as of June 30, 2021	34,089	$	1.58	6.46	$	3,013,482
Vested and expected to vest at June 30, 2021	73,244	$	2.79	7.46	$	6,385,925


	Restricted Stock Units			Restricted Stock Awards
	Number of Shares	Weighted- Average grant date fair value		Number of Shares	Weighted- Average grant date fair value
	(in thousands)			(in thousands)
Unvested as of December 31, 2020	3,061	$	31.55	388	$	37.75
Granted	7,126	$	77.21	—	—
Released	(3)	$	77.00	(32)	$	37.75
Cancelled	(92)	$	32.01	—	—
Unvested as of June 30, 2021	10,092	$	63.69	356	$	37.75


	Company Stock Price Hurdle		Number of RSUs Eligible to Vest	Performance Period Commencement Dates as Measured from the Effective Date
1	$	165.00	750,000	2 years
2	$	200.00	750,000	3 years
3	$	235.00	2,000,000	4 years
4	$	270.00	2,000,000	5 years
5	$	305.00	2,000,000	5 years
6	$	340.00	2,000,000	5 years
7	$	375.00	2,000,000	5 years


	Six Months Ended
	June 30, 2021
Risk-free interest rate	0.06%	-	0.15%
Expected volatility	53.77%	-	56.9%
Dividend yield	—%
Expected terms (in years)	0.44	-	1.95


	As of Three and Six Months ended June 30,
	2021	2020
Stock options outstanding	73,244	91,866
RSUs outstanding	10,092	—
Stock warrants outstanding	324	260
Convertible Preferred Stock outstanding	—	349,522
Unregistered restricted stock awards outstanding	356	—
2020 ESPP	731	—
Total	84,747	441,648


	Three Months Ended June 30, 2021				Six Months Ended June 30,
	2021		2020		2021		2020
	(dollars in thousands, except per share data)				(dollars in thousands, except per share data)
Revenue	$	454,100	$	200,392	$	841,076	$	361,962
Cost and expenses:
Cost of revenue(1)	116,930		53,669		214,867		95,462
Developer exchange fees	129,714		85,052		248,652		129,551
Infrastructure and trust & safety(2)	108,986		61,853		203,122		114,473
Research and development(2)	124,748		40,249		221,392		89,658
General and administrative(2)	97,678		18,707		192,053		49,265
Sales and marketing(2)	18,990		13,908		38,992		29,565
Total cost and expenses	597,046		273,438		1,119,078		507,974
Loss from operations	(142,946)		(73,046)		(278,002)		(146,012)
Interest income	26		294		31		1,541
Other income/(expense), net	10		494		(1,040)		(2,663)
Loss before provision for income taxes	(142,910)		(72,258)		(279,011)		(147,134)
Provision (benefit) for income taxes	20		5		22		6
Consolidated net loss	(142,930)		(72,263)		(279,033)		(147,140)
Net loss attributable to the noncontrolling interest(3)	(2,796)		(742)		(4,682)		(1,240)
Net loss attributable to common stockholders	$	(140,134)	$	(71,521)	$	(274,351)	$	(145,900)
Net loss per share attributable to common stockholders, basic and diluted(4)	$	(0.25)	$	(0.40)	$	(0.63)	$	(0.83)
Weighted-average shares used in computing net loss per share attributable to common stockholders—basic and diluted(4)	571,300		180,336		432,159		174,939


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	Roblox Corporation

Date: August 16, 2021	By:	/s/ Michael Guthrie

		Michael Guthrie
		Chief Financial Officer
		(Principal Financial Officer)