The gaming industry showed impressive resilience to global economic shocks in recent years, with revenues and users surging while other sectors suffered major hits. The entire market also weathered 2022’s economic turbulence better than many other industries. Still, for the first time in its history, the gaming industry lost around 176 million gamers, revenues grew by a modest 5% year-over-year to $208.6bn, and the stock value of all major gaming companies plunged. But one of them suffered a much bigger loss than the others.
According to data presented by Casinos En Ligne, Roblox stock value slumped 53% in the last two years, the biggest drop of all leading gaming companies.
$20B Wiped Off the Stock Value in Two Years
Initially released for PCs in 2006, Roblox became an instant hit drawing millions of players from across the globe. The popularity of the free-to-play gaming platform exploded in 2020, driving revenues and the number of users to new highs. Despite COVID-19 restrictions being lifted, user engagement on Roblox continued surging in 2021.
The company’s official data showed the number of daily active users hit 43.2 million in mid-2021, a 42% increase YoY, and continued rising by the end of the year. Still, stagnant user numbers and currency headwinds had investors down on the gaming platform company in 2022.
In November 2022, Roblox had 56.7 million daily active users, up 15% from November 2021. While DAUs were up year-over-year, this number represented a drop from the 58.8 million DAUs Roblox averaged for Q3 2022. Moreover, Roblox’s growth largely came from Europe and Asia-Pacific, which saw 30% and 40% year-over-year growth, respectively. However, currency exchange rates weakened the relative value of foreign revenues.
The challenging 2022 cut down the company’s stock value. In March 2021, the Roblox market cap stood at $37.1bn. By the end of the year, this figure doubled to $74.8bn. Still, it was downhill from there. In the next three months, the market cap of the world’s third-largest gaming company plunged by 43% to $42.2bn and continued falling. In May, Roblox stock value hit an all-time low of less than $14bn and then rose to $17.1bn in the last eight months. Statistics show more than $20bn had been wiped off Roblox’s market cap in the last two years.
Almost All Gaming Companies Witnessed a Double-Digit Market Cap Drop
Although Roblox has taken the most brutal hit, nearly all other major gaming companies witnessed a double-digit market cap drop in the past two years.
Last year, Microsoft purchased Activision Blizzard in the biggest gaming acquisition of all time. The $68.7bn worth deal caused Activision Blizzard’s stock value to jump 35% in two months and hit $63.4bn in February. Still, this figure slipped to $59.9bn in the last twelve months, showing a 15% drop in two years.
The Japanese gaming giant, Nintendo, lost 25% of its stock value in this period, or 15% more than Electronic Arts. Take-Two Interactive follows with a 7.4% drop.
Statistics show Ubisoft is the only gaming company standing close to Roblox on this list, with a massive 52% market cap drop in the last two years.
