Roblox's market valuation surged to more than $45 billion Wednesday after its shares jumped nearly 55% during its stock market debut. The stock closed at $69.50 per share.
The New York Stock Exchange set a reference price of $45 per share for the stock. Roblox listed its shares directly on the exchange instead of issuing new stocks during its initial public offering.
In its filing documents, Roblox described itself as a "metaverse," where users can build their own environments and worlds. Through its video game platform, users can build theme parks and resorts, which other players can also visit.
"Roblox is an amazing community where people are creating together," the company's co-founder and chief executive officer, David Baszucki said. Following the surge in the stock's price, Baszucki's stake in the company is now estimated to be worth more than $4 billion.
The company's game is currently free to download on both Apple and Android devices. The game uses an in-game currency called Robux, which players can buy using real money. Roblox generates all of its revenue from the sale of the in-game currency.
According to its latest earnings report, Roblux generated nearly $925 million in revenue last year. This was an 82% increase from the revenue it generated in 2019. The company attributed the significant increase in sales to the surge in new users during the pandemic.
At the end of last year, Roblox reported a daily active user count of more than 32.6 million. The company said that it expects to have around 34.6 million to 36.4 million daily active users by the end of 2021.
While most of the game's players are children under 13-years of age, the company is hoping to expand its reach to include young professionals. The company said that its interactive software can soon be used for both entertainment and work.
If the company does push forward with its plan to expand its audience, it will likely be facing regulatory hurdles to ensure the safety of its underage users.
"The increased use of interactive entertainment offerings like ours by consumers, including younger consumers, may prompt calls for more stringent consumer protection laws and regulations that may impose additional burdens on companies such as ours," Roblox said.
