Shares of Roblox (RBLX -2.24%) were down 9% as of 10:55 a.m. ET on Friday. On Thursday, the company updated investors on its long-term roadmap for growth and revealed improvements coming to the platform in the near future.
The company's slowing growth coming out of the pandemic has weighed heavily on its shares in 2022. Several analysts have downgraded the stock in recent months, contributing to its 61% slide year to date.
Roblox reported a 24% increase in daily active users for the month of August. The platform continues to gain popularity as a place to hang out and interact among nearly 60 million daily active users. Wall Street, however, is concerned about falling bookings (a non-GAAP measure of revenue) and weakening user monetization.
Management estimates that bookings per daily active user were down by 14% to 16% year over year in August. While that's not surprising during the back-to-school season, the same trend was evident in previous quarters.
During its investor day presentation, management laid out several areas of improvement that are coming. The company will be rolling out new animated avatars that use real-time facial tracking and user voices. Also, immersive ads are coming in 2023, which will give brands and creators new opportunities to generate revenue from their content.
But investors are taking a wait-and-see approach. It's not clear what immediate impact immersive ads will have on the platform. After all, the soft macroeconomic environment is causing some softness in the advertising market right now.
The decline in bookings is the central factor weighing on the stock. In fact, the shares still look expensive at a price-to-sales ratio of 10.6. Roblox stock isn't likely to rebound until the company gets its bookings growing again.