The clock is ticking for initial public offerings in 2020, and Roblox made the deadline. In an after-hours move, the free-to-play games specialist filed its form S-1 with the U.S. Securities and Exchange Commission. Many investors are already excited about this news. But what do you need to know about the Roblox IPO?
With that big question in mind, here are 15 things you need to know about the Roblox IPO right now:
- As a reminder, Roblox specializes in free-to-play games for mobile devices and other consoles.
- Roblox is wildly popular, and has become even more so during the novel coronavirus pandemic.
- This is great news for the company, which also encourages players to purchase digital currency to unlock premium features.
- Many Roblox users are teens and tweens, individuals ages 9 through 15.
- So what about the actual Roblox IPO? Well, the company plans to come public on the New York Stock Exchange under the symbol RBLX.
- Like many other firms, it will offer two classes of its common stock.
- Class A will come with one voting right per share, while Class B comes with 20 voting rights.
- Following the Roblox IPO, CEO David Baszucki will hold all outstanding Class B shares.
- Importantly, this means Baszucki will be able to “significantly” influence decisions.
- Roblox is not currently releasing how many shares it will offer, or what the IPO price range will be.
- The company saws it has 31.1 million daily active users, 22.2 billion hours of engagement with those users.
- Additionally, it says it brought in revenue of $589 million during the first three quarters of 2020.
- This figure is up nearly 70% from the same period last year.
- Roblox could be worth as much as $37 billion when it comes public.
- Importantly, it will join big names like Airbnb, DoorDash and Affirm in the year-end IPO rush.
Why the Roblox IPO Really Matters
Why are many investors exited about the IPO of a tween-focused gaming company? And what does Roblox have in common with the likes of Airbnb and DoorDash?
Well, the coronavirus pandemic is a large part of the answer to both questions. Investors should know that Roblox has been in business since 2006, but things have really been looking up for the company in recent times. In fact, Roblox says it experienced rapid growth in the first nine months of the year. Why? The pandemic led more consumers than ever to its mobile games. Daily active users almost doubled. Hours engaged more than doubled. With this backdrop, the Roblox IPO is about to take place.
Additionally, we have also seen a big boost overall to the video game space thanks to the pandemic. Recent debuts of consoles from Sony (NYSE:SNE) and Microsoft (NASDAQ:MSFT) were particularly buzzworthy. Other recent gaming IPOs like that from Unity Software (NYSE:U) have continued to captivate investor interest. And, it is clear something is working in the market niche. Giant Amazon (NASDAQ:AMZN) has even been crafting its big video game debut.
With all of this in mind, there is a lot to look forward to with the Roblox IPO. Now, investors just need to see if the post-pandemic future can hold up for Roblox.
On the date of publication, Sarah Smith did not have (either directly or indirectly) any positions in the securities mentioned in this article.
Sarah Smith is a Web Content Producer with InvestorPlace.com.
