Roblox stock drops after missing Q2 earnings estimates

Yahoo Finance's Jared Blikre provides takeaways from Roblox's Q2 earnings report.

Video Transcript

ADAM SHAPIRO: Welcome back to "Yahoo Finance Live." Before we start diving into earnings regarding retail, we want to talk about a 3D game maker that 11-year-olds love, Roblox, out with their earnings. Jared Blikre, what do they got?

JARED BLIKRE: That's right. Stock has been down as much as 8%. We paired some of the losses. But some disappointing numbers. And the headline number here is booking, $665.5 million. Street was looking for higher at $683.3 million. Revenue came in at $454.1 million. And then there was a loss per share of $0.25. The Street was expecting a profit of $0.23. So on those headline numbers alone, we did see that pretty steep sell off.

Now we did see second quarter bookings. Those increased 35% to $665 million. But I want to draw everybody's attention to the Wi-Fi Interactive. This is an historical chart of their bookings, of Roblox bookings. And you can see they've kind of leveled out recently. So 665 a little bit less per quarter, a little bit less the prior quarter. But what I want to draw everyone's attention to is the rate of change. We got up to 220% one year ago. And now we are at 35%.

So when you have one of these high growth companies posting some lackluster numbers, pretty common for the stock to get whacked. In fact, to see it down only 8% at the lows, I would have thought it had been down a little bit more. Nevertheless, let's take a look at a chart of Roblox from its IPO date. We'll get a max chart here. And we can see just about in the middle of its entire trading range guys.