Outside Source
Once a key player in the metaverse realm, Roblox anticipates a challenging 2024 as its investors voice concerns regarding the company’s ability to achieve sustainable profitability.
Roblox, previously touted as a metaverse hub within the gaming platform space, is gearing up for a tough year ahead as its financial health continues to deteriorate, as per Sahil Alvi, the founder of Neuron Partners, an early backer of Roblox.
In an interview with Fortune, Alvi did not hide his frustrations, noting that Roblox’s shares are still far from its IPO price achieved in Q1 2021.
“We’ve been watching the stock languish for the better part of two years. It doesn’t seem the leadership team has gotten the memo that times have changed and markets no longer reward growth for growth’s sake.”
Sahil Alvi
While Alvi did not detail his firm’s stake in Roblox, he has openly urged Roblox’s CEO, David Baszucki, to take the firm private for a few weeks now. In a late November open letter published on LinkedIn, Alvi addressed challenges around Roblox, stating that a path to profitability “is not clear for the company.”
“[…] perhaps taking Roblox private may indeed be one of the solutions to stanch the leakage of shareholder value in Roblox stock.”
Sahil Alvi
Roblox has made no public comments on Alvi’s letter so far. The Neuron Partners founder says 2024 will be crucial for the gaming firm, as the California-based company has only left nearly $2.1 billion in liquidity, adding that the firm management team “need to get dead serious about becoming profitable before the company finds itself in financial dire straits.”
“2024 is going to be a crucial year, where we take a view whether management is moving the company towards a sustainably profitable business.”
Sahil Alvi
As of press time, RBLX is trading at $46.4, according to data from Google Finance. Although the shares are up more than 66% year-to-date, the mark is still far from not only its all-time high of November 2021 but also from Roblox’s IPO when RBLX price was at $70.
This article first appeared at crypto.news
