Roblox and Reddit shares each plunged more than 20% after their July 30 earnings reports, but only Reddit presents a buying opportunity. Roblox's daily active users rose 10% to 123 million, missing the 128.7 million analyst estimate, and it forecast a 14% to 18% decline in bookings next quarter, while its gross margin remains around 30% and stock-based compensation weighs on profitability. Reddit's daily active unique users climbed 18% to 130.3 million, beating estimates, revenue surged 61% to $804.9 million, and earnings per share nearly tripled to $1.25, with third-quarter revenue growth projected at 47% to 49%. Reddit is also renegotiating a $60 million-a-year data-licensing deal with Alphabet that could serve as a catalyst, and its stock trades at a forward price-to-earnings ratio of just 15 times 2027 analyst estimates.
Roblox CorpMissed DAU estimates and weak bookings guidance, with margin and SBC concerns.
Reddit, Inc.Beat estimates with strong revenue and EPS growth, and positive guidance.
Alphabet Inc Class C