Good morning. My name is Dennis, and I will be your conference operator today. At this time, I would like to welcome everyone to the Roblox second quarter 2022 earnings conference call. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question and answer session. If you would like to ask a question during that time, simply press star, then the number 1 on your telephone keypad. To withdraw your question, press star one again. I would now like to turn the conference over to Stefanie Notaney, Director of Financial Communications. Please go ahead.
Good morning, everyone, and thank you for joining our Q&A session to discuss Roblox's Q2 2022 results. With me today is Roblox CEO, David Baszucki, and CFO, Michael Guthrie. Before we start, I want to remind everyone that yesterday after market close, we published a shareholder letter and earnings results on our investor relations website at ir.roblox.com. On this call, we will make some brief opening remarks and reserve the rest of the time for your questions. For our webcast participants, please note the question icon at the bottom of your screen where you can type in your questions. We'll do our best to take as many questions as possible in the time we have allotted today. On today's call, we may be making forward-looking statements, including but not limited to our expectations of our business, future financial results, and business and financial strategy.
Forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from those described in our forward-looking statements, and such risks are described in our risk factors included in our SEC filings, including our Form 10-K filed for our first quarter ended March 31, 2022. You should not rely on our forward-looking statements as predictions of future events. We disclaim any obligation to update any forward-looking statements except as required by law. During this call, we will also discuss certain non-GAAP financial measures. Reconciliations between GAAP and non-GAAP metrics for our reported results can be found in our press release issued yesterday, as well as in our supplemental slides, copies of which can be found on our investor relations website. This call is being webcast and will be archived on our website shortly afterwards. With that, I'll turn it over to Dave.
Thank you, and welcome to our investors and welcome Roblox community. I'll share a few quick highlights, and then we'll take questions. We had a solid Q2, and then we followed this up with July, which was absolutely the biggest engagement month in Roblox history, including all peak COVID times. The month of July was a peak across regions and across demographics. I want to share a few highlights. In July, our DAUs were 58.5 million, up 26% year-over-year, and our hours of engagement were 4.7 billion hours across the whole platform, up 25% year-over-year. I want to highlight that this year-over-year growth and this peak engagement also included our core U.S., Canada market, with DAUs up 15% year-over-year and hours up 23% and bookings up 14% year-over-year in July.
We continue to see accelerating growth in our over-13 DAUs, which were up 36% year-over-year globally. As greater than 13 users on the platform become more prevalent, this is a good harbinger of the potential size of this market and why we continue to be so optimistic. Finally, we exited June bookings up 8% year-over-year and July bookings up roughly 8%-10% year-over-year. This is powered by amazing content and our amazing community and continued innovation on the technology side. On the content side, we are approaching 50% of our top 1,000 experiences with more over-13 than under-13 players. Our developer community, with our developers producing experience that gained over 1 million hours per month, is up 32% year-over-year.
We continue to see great brand experiences side by side the amazing Roblox experiences that have traditionally been on our platform, and more and more of these are self-serve. I'll highlight some of the brands we shared with this last quarter, including Gucci Town, which had over 30 million visits since March. We saw Tommy Play from Tommy Hilfiger with over 7 million visits since June. Wimbledon released WimbleWorld, and Spotify Island was released, which is a persistent space with artist appearances. I wanna highlight that we are getting to the point where our 17-24 cohort is going to pass our 9-12 cohort in size. Now, the 17-24 cohort is larger, but once again, this is a great signal of the potential size of our market across all ages.
This growth, in addition to being powered by our amazing content developers and our amazing viral community, is supported by our innovative tech, some of which is iterative and measurable, including improvements to our Roblox translation system, including the quality and personalization of our search and discovery system, and even including things that might not be readily noticeable, such as the speed that our mobile app and game joins occur in, just raw performance. On the vision side, our layered clothing system is just a first step to very highly personalized avatars across the platform. Our voice system is rolling out and is a great sign of really the future of how people will communicate on platforms like Roblox. Our physically based material system has been widely acclaimed by our developers as the next step in taking Roblox to a more realistic look and feel.
Finally, I want to highlight that we continue to work on innovative, immersive, native monetization systems, and we do expect to be rolling out a test of our immersive advertising system sometime later this year. You'll notice in our announcement we are making investments in infrastructure. We are building a worldwide cost, performance, and reliability leading infrastructure, including active performance around the world. I want to highlight that infrastructure performance contributes to our growth with an example of the recent data center we deployed in India. Finally, we continue to hire at the same rate we did in H1 and are optimistic about continuing to bring great talent into the company. With that, we will move on to your questions. Thank you.
Thank you. As a reminder, in order to ask a question, simply press star then one on your telephone keypad. We'll first go to Drew Crum from Stifel. Please go ahead.
Okay, thanks. Hey, guys. Good morning. Dave, in your shareholder letter, in your preamble, you noted your fastest growth demographic in the U.S. and Canada was that 17-24-year-old segment. Can you remind us how this cohort monetizes relative to others on the Roblox platform? Then I have a follow-up.
Hey, Drew, it's Mike. Just getting into the numbers. In the month of July, that 17-24-year-old cohort in the U.S., and we measure this on a bookings per hour basis, was actually just slightly ahead of our core 9-12 demographic, which historically has been our peak monetizing age demo. Now, we'd expected that. Over time, we always said that as the older users who have more direct control over their spend become more prominent on the market, they would monetize better, and we certainly saw that in July.
Got it. Thanks, Mike. Dave, maybe, you know, more broad question. You know, during this current earnings cycle, several video game publishers have cited weaker trends across mobile gaming. You know, with Roblox being a free-to-play model, what are your thoughts on how the business should perform during a period of economic weakness? Thanks.
Yeah. I wanna highlight one of the wonderful things about Roblox is we're not a game, and we're not really even a game platform. We're a future human co-experience platform. A lot of what people do on Roblox is come together to be together, to connect, to socialize. We're starting to see people supporting educational experiences. We have traditionally been neutral, i.e., immune to these types of economic cycles. We have a robust economy. We've been through these cycles before, and we've been relatively immune to them.
We'll move next to David Karnovsky at J.P. Morgan. Please go ahead.
Oh, hi. Thanks for the question. David Baszucki, wondering if you could just discuss the ongoing rollout of voice chat, how developers and players are responding to it, and how that might be impacting frequency for some of the older cohorts. Just as a follow-up, you mentioned a test of immersive advertising later this year. Just wondering if you could expand on the scope of that and what that potentially implies for rollout or when you might be able to update investors on kind of the longer opportunity there.
Yeah. I wanna highlight consistent with our values and the way we've run Roblox since the early days, safety and civility is a high priority here. We are rolling voice out. It is partially rolled out now with older players with validated IDs and with, you know, we're opening that aperture. We can measure increased engagement from the people using voice, and so we're very optimistic about what's happening there. The vision of immersive advertising has been around for a long time, and this is both performance as well as brand advertising. We are going to be rolling out tests, ultimately along both of these lines.
It is the notion that in an immersive 3D space, it's a lot less, there's a lot less friction when we see appropriate advertising just like we would in the real world, a billboard ad, for example, which we could scale across all the experiences on Roblox. We're also optimistic now that we've seen many brands establishing a presence in Roblox, that some of these brands will also want performance marketing, which is a way for in the appropriate case, for people to be able to go to one of our brand partners directly from someone else's 3D experience. We're really optimistic about this, and we love the idea of in a gentle way, complementing our already very healthy economy with an additional potential revenue source.
Thank you.
We'll move next to Clark Lampen with BTIG. Please go ahead.
Thanks a lot. Good morning. I wanted to come back to, you know, the sort of success that you're seeing with 17+ users, just because we are seeing, you know, a lot of signs of success with aging out, both in terms of aggregate DAUs and engagement. Could you give us more of a sense for how those users are engaging differently versus younger ones? Are they spending time in different experiences or are they monetizing more passively or using different hardware? Any color you could provide would be appreciated. Mike, just given you guys made some comments around, you know, sort of CapEx trends over the balance of the year, could you give us a sense for infrastructure investment projects? Is this really a 2022 endeavor, or is this something that we could see sort of stretching into 2023 and beyond?
Anything you can say about cash flow and CapEx would be appreciated. Thanks.
Yeah, I'll start off on the experiences. I noted that of the top 1,000 experiences on our platform, 481 now have more 13 and up players than under 13 players. Our developer community is amazingly responsive. The quality of the content that they're creating is getting better and better, both based on their sophistication, the size of their teams, as well as our tool set and our infrastructure. We can see more and more experiences in those top 1,000 that are very heavily targeted to older players. Like any healthy market, given the size of our developer economy, we are seeing developers respond with those experiences. In addition, we have a pipeline of experiences that are very aligned with the types of things older players might want to do coming through our game fund.
I want to highlight that across our platform, the vision for a platform like this goes way beyond playing games. We know right now, for example, in the midst of COVID, people use Roblox as a communication tool to be together when they can't be together physically. We can see partners like FIRST Robotics now getting ready to launch educational experiences for people who can't build Roblox with the physical kits. We ultimately, you know, all of our brand partners, including our music partners, are using Roblox as a way for people to go to concerts together. The vision of this category is bigger than play, and as you correctly note, there's a lot of different use patterns we see across the platform.
Clark, CapEx will be spread across the balance of this year and next year, so we'll certainly be investing in infrastructure across both periods. Timing of spend, you know, we gave a rough estimate of what it looked like for the back half of the year, but we'll definitely have incremental spend in 2023. But we view it as incredibly productive, and it's partially driven by just a, you know, substantial growth in our user base and the desire to get to more, even more economical infrastructure, so more performant, more reliable and more efficient for us.
Thank you.
We'll move next to Matthew Cost at Morgan Stanley. Please go ahead.
Great. Thanks, taking the question. So one for Dave, one for Mike. Dave, just there's some language in the letter about key investments and product initiatives that drove a positive impact for July. You touched on in the prepared remarks, but I wonder if you could just give any more detail about what specific products, you know, you think were the most impactful for July. Then for Mike, just wondering how should we think about the pathway for margins from here, as you continue to invest in new hires and infrastructure? Thank you.
Sure. Yeah. You know, our growth is powered by the content created by our community, by the core virality of our product, which is great content coupled with a viral loop, and then with innovative technology. All of the things I measured are early signals. Our layered clothing system is an early signal towards hyper-personalized avatars that more and more might look like you, might be of various styles that are supported by our creator community. This is a first step. On voice, once again, I would highlight long term, we see more and more people potentially using voice as we roll this out. There are also under the covers, coupled with the visionary tech we're working on, constant iterative improvements on raw performance. How quickly can you join a Roblox experience?
We can see our translate system, we can see search and discovery, we can see raw mobile app performance, we can see our game engine performance all contributing to growth as we go forward. Up and down our product stack, there continues to be big things we're working on. We'll share some of these at Investor Day, but we have a lot of other, you know, visionary things in the pipeline. We've said publicly that this doesn't really stop until we're supporting a 50,000-person concert at photorealism in real time with simulated audio and video. There's a huge runway for technical innovation in this space.
Matthew, you asked a question about margins, so let me address that, and then I want to make another comment here. Let's go back. Prior to the scaling that we saw during COVID, the business tended to run in EBITDA margins in the mid-teens pretty consistently and as we scaled up during COVID, those margins basically doubled, and we found ourselves in the 30% range. We were really clear at the time that that was not steady state margins for us, and we saw an enormous amount of opportunity to invest. The top line was growing so quickly that, you know, it was very difficult to almost bring the margins down. What we've chosen to invest in are the things that we see incredibly high ROI.
Hiring great people, pushing more of the economics to our developer community, which is clearly bearing fruit today and will continue to do so, and the investment in infrastructure. Today, as we've been incredibly consistent in our investments and the top line has flattened as we're coming out of COVID and now has started to pick up again, obviously margins are gonna move around. What's consistent is that we're investing for the long run and that we have the unique economics and liquidity to continue to do so. I suspect that when we get into 2023 and we're no longer, you know, dealing or hopefully no longer dealing with COVID comparisons or non-COVID comparisons, we'll start to see the top line grow at a rate that will allow us to produce, you know, really healthy EBITDA margins.
We will, however, continue to invest in infrastructure next year. Free cash flow margins will be down, but overall operating margins I think will go back up and we'll be in a healthy place. We'll continue to invest for the future. I do wanna make one quick comment. In your note this morning, you said that you expect elevated SBC will continue to drive scrutiny on the risk of dilution from new hire retention stock grants. Maybe we'll just remove any scrutiny. We've been really clear. We were in the letter. We've been tracking this as a management team, as operating executives, and we spent an enormous amount of time structuring our compensation plans and our recruiting plans. We've worked with our board.
We saw this coming, and we've been really clear that we would keep share dilution under 5%. You know, the good news here is you've got shareholders on this side of the table, and so we are as dilution sensitive as any shareholder who is out there on the call. We're gonna continue to recruit great talent. We're gonna continue to compensate our people, and we're also gonna watch the dilution and keep it under 5% and hopefully, you know, do even a little bit better than that. I don't think there should be any undue speculation or concern there.
We'll move next to Omar Dessouky with Bank of America. Please go ahead.
Hi, guys. Okay. Can you please give me an update on the level of adoption of layered clothing among your players? Number one. Number two, back in March, shortly after its launch, you had showed that the purchases of layered clothing items did not cannibalize purchases of existing 2D and 3D clothing items, and that was at the GDC. I wanted to ask you whether that is still the case. Number three, do you have a sense yet for when 3D layered clothing will be coming to the community at large, the creation of 3D layered clothing will be coming to the community at large? I have a follow-up question after that.
Yeah. I'll go high level, and then I'll see if Mike has the numbers floating around on that. Taking a step back and peeking at the vision of where this is going is ultimately every avatar, every head, every piece of clothing on our platform is created by the community. Historically, almost all of this was created by Roblox, and we're just about through that transition where everything is made by the community. The final one that you're gonna see rolling out is avatars themselves being created by our community as well, and that'll bring us full circle, and you'll see an amazingly new look. We are very optimistic that this is not viewed as a necessary cannibalization situation as much as where is the future here. The future is everyone has a hyperrealistic avatar.
It looks just like them. You can imagine all the ways we might build an avatar, including using a camera on a device, using ML, using developers themselves. There's a lot of interesting and exciting ways in the future we'll build avatars, coupled with a lot of clothing that is more and more created by our community. This is the right direction. It is the big vision. Ultimately, all of the clothing on our platform will be 3D clothing, and there will still be an opportunity for users to create clothing, but it'll be painting on 3D clothing rather than long-term using our traditional 2D clothing. I don't know, Mike, if we are sharing any numbers on the adoption, but ultimately, we expect 100% of users to be using layered clothing. Yeah.
I will give you a couple of quick numbers and just some trends. I think that's the most important thing, but it's a good question. As of June thirtieth, we had over 100 million users that had actually acquired a layered clothing item, and we've been doing tests to look at the economic output of those users and how they behave, and we've clearly seen it being accretive to bookings and Robux spend. We'll give more data as that becomes a bigger and bigger part of the business. So far, the early indications are high levels of adoption and high performance within the user base that does acquire the items.
Okay. Thank you. Along the same kind of topic, you released dynamic heads towards the end of June. I was wondering. You also said, I believe, in the release that Dynamic heads would be available in the avatar store at some point in the fourth quarter, which is new information. Can you give us a little bit of an idea of what the plan for monetization of dynamic heads is? Like, will the heads developed by a curated community of creators sort of be on sale there? You know, will users you know, buy heads with a subset of emotions that are animated on their faces? I guess what exactly will the buyers on Roblox be buying?
Yeah. Let's take a big visionary step here. We acquired a company called Loom.ai over a year ago, and you can check out the types of demos and the technology they create. It ultimately drives towards the vision that for those users who so choose on our platform, in addition to having their avatars be more personalized and more animated like themselves, the opportunity to actually have the heads and faces of those avatars animate in sync with, optionally the use of the camera on your device or lip syncing. We've shared demos of this. I've done meetings this way. It's absolutely immersive and engaging in the future of where this is all going. Dynamic heads are one part of this, and the rollout will occur in various steps. One is developer tooling.
The next step is very simple things like emojis and, really emotes actually, and the ability to have a pre-canned animation on your head, and ultimately full tracking of that. We always think long-term, first and foremost, about engagement, retention, and really frequency and making our experiences better. Because our bookings tend to scale with bookings per hour, we expect the more engagement we get, the better this is gonna really be. On top. I think we're not as much. Well, there is huge opportunity for dynamic heads in our marketplace, and at the same time, I wanna highlight that we're primarily thinking about this long-term as increasing engagement. But it's gonna be overall positive in both dimensions. Then I don't know, Mike, if you wanna share anything on top of that.
No. I think we'll report more as we have more data and maybe touch on this at Investor Day next month.
Got it. Thanks very much.
Thanks so much.
We'll move next to Bernie McTernan at Needham & Company. Please go ahead.
Great. Thanks for taking the questions. Maybe just to start, if you could talk about the product improvements to search and discovery. Spoke about it on the last call, and I think it helped with some of the age of content this quarter. If you could just detail when the improvements happened during the quarter and if there's still more improvements to come.
Um-
to the full quarter benefit
Yeah.
in the third quarter.
I wanna highlight that one of our values you know is take the long view, but one of our values is get stuff done. These improvements are happening every day. They are not forklift drops. They are a constant weekly improvement in the way we do search and discovery. There is so much opportunity here because as people come to our platform from different regions, from different ages, from different interests, there's an amazing opportunity to personalize the types of experiences they see when they both first join our platform as well as when they become mature users. We have a lot of signals that you might not find on a traditional platform, including what are your friends doing? What do people like you do? What have you done in the past? This is constantly improving.
We are more and more getting personalized. We are ultimately trying to share experiences with everyone on the platform that will keep them engaged as much as possible and ultimately drive long-term enterprise value. This is occurring both in cold start as well as in warm start for more mature players on the platform. To go full circle on your answer every day, I will add that one of the things we have done in the last quarter, we shared that we were gonna do it, is more and more move to the efficient frontier, where we have historically been 100% engagement based on our discovery and search. We believe there is an efficient frontier where engagement is balanced with monetization that drives the overall health of our platform.
Really, when we have two experiences that are both retaining well, that are both predictive of the same play time, we are nudging towards that experience that monetizes better in that type of situation, which is what the efficient frontier is about.
Understood. Thank you. Then just as a follow-up, in the past you've spoken about the weekend versus weekday usage, and that gave you confidence in to be able to grow following the tough COVID comps. Can you just talk about what you're seeing for weekday versus weekend usage now that you're at peak engagement again?
I wanted to just highlight that our long-term growth has so much opportunity. It's not predicated on weekdays or weekends. Even in our most healthy long-term cohorts, which would be US, Canada, nine through 12. There's a lot of headroom there, given that, traditional Roblox users aren't using Roblox every day as a communication tool. There's a lot of room on frequency within our traditional audience. As you can see the growth rates in our 13 and up and 17 to 24 cohorts, that cohort of 17 to 100 is much larger than the cohort of 9 through 12. There is also amazing headroom amongst older players on our platform to complement the headroom we have in our traditionally strong cohorts based on frequency.
Yeah, to dive into that, we, you know, when COVID started, our core age demos spiked up very quickly, especially in terms of engagement. Then as we started to lap and reopen, obviously, especially in the U.S., that 9 to 12 cohort was actually pulling our booking growth numbers down, but we were making up for it in other places. We've now gotten to the point where we've crested back to the point where on an absolute level, those cohorts are now growing around the world. Importantly in the U.S. and Canada, because that's where, you know, there's a more significant amount of wealth and spend.
We are now at peak levels of daily active users, of engagement, and of bookings in those nine- to 12-year-old cohorts in the U.S. and benefiting from growth in 17- to 24-, 13- to 16- on all the older user bases. We're in a great position where finally now on an absolute basis, we're now at a point where all of that growth that we benefited from during COVID, we've absorbed. We've obviously retained the vast majority of it, and we're now growing on top of that really across all age demographics. That's true on Tuesdays, Wednesdays, and Fridays and Saturdays as well.
Yeah, I think we're hopefully if we all stay healthy and go on living our lives, we'll be more or less done with COVID comparisons here pretty soon.
Great. Thank you both.
Thanks.
We'll move next to Eric Sheridan at Goldman Sachs. Please go ahead.
Thanks so much for taking the question. Maybe talk a little bit about what you're building on the advertising side as another means of monetization, and how should we be thinking about a mixture of both investments on the advertising side, building relationships with advertisers, and what you see as some of the revenue output of that as we look out over the next couple years? Thanks so much.
Yeah. I wanna highlight the opportunity on our platform, both for traditional experienced developers who are new developers, creating new games and experiences on our platform, as well as brands who are establishing presence for people to interact with clothing, people to interact with music, people to interact with beauty, people to interact with a wide range of things, and potentially even monetize within those experiences. Traditionally, a lot of these experienced developers and brands have been saying, "How do I boost more? How do I get more traffic to my experience? How do I do a test? How do I reliably bring 1 million users a day to this experience?" This is the wonderful opportunity for native, immersive, non-intrusive advertising in our platform. Imagine we are at one of our most popular Roblox experiences.
Imagine a triple A partner has a small pop-up in the town square, and players will be able to choose whether to stop by, use that pop-up, or portal or door, you name it, to jump over to one of our brand experiences, experience something new, pick up some free merch, and then back, you know, pop back to the experience they're playing. This is a, you know, this is a very scalable potential way to incorporate gently, both paid as well as performance and brand advertising. Given that we did 4.7 billion hours of engagement in the month of July, even at very conservative, you know, gentle ways of initially trying this with top-notch brands, you can see the potential there relative to the advertising per hour.
I said it before, this has been always a visionary type of advertising. It's exciting because it doesn't get in the way of a user or add friction like some other types of advertising. We believe it'll actually be a fun and positive way that will complement our experiences.
Eric, the end of that was your question on are we scaling up a team internally to be, you know, covering the brands? Is that the last part of your question?
Yeah. I think I'll highlight.
Yeah. I'll say two things and then Mike maybe finish. We are building traditionally what has powered Roblox is the notion that at its foundation we build self-service, and self-service is always more difficult to build than bespoke things. Our Roblox's success is we are a self-service platform for experience creators. The product direction for this advertising system will also be self-service. It will be complemented by our amazing brand team. We have a great team. It's scaling. We have amazing people who are working with Gucci and Tommy Hilfiger to usher this new form of advertising to the platform. We expect to continue building this amazing brand team. It will not be a sales team. It will be a consultative team to help people who are doing self-service and exploring our platform.
Yeah. I'll just add it. This is a team that's been in place for a while. These discussions with brands have been going on for quite a while. We really do see it above and beyond just an ad sales organization. It's very strategic. We've been talking with brands about the overall benefit of immersive engagement on our platform in multiple ways. You've heard us talk about this before. We have had incredibly high quality brands more or less experimenting on our platform in a new medium, which is really exciting. We've not raced to monetize these too quickly. I think we've learned a ton and the team's done a great job, and the quality of the brands that we've been working with has just been, you know, first class.
We'll move next to Matthew Thornton with Truist Securities. Please go ahead.
Hey, good morning, David and Mike. This is Steve Barkov on for Matt Thornton. Two questions if I could. Can you talk about how we should think about the incremental monetization efforts playing out and impacting second half of 2022, examples being sponsored search, immersive ads, and commerce? Also, how should we think about what normal seasonality is for August and September, and any growth comparators you would call out for the second half of 2022? Thank you.
Hey, Steve. Let me take the last questions and work in reverse. We noted in the letter that there was, you know, Omicron happened in Q4 of last year. We're just making sure that everybody is aware and doing their own homework as we go into the fourth quarter. Obviously, we've got a lot of momentum from May to June and June to July. We expect that to continue. The normal shape of the curve in terms of the third quarter is what you saw last year, which is that from July to August, typically August is, you know, flat to slightly down 2%, let's say, off of July. That's sort of the normal seasonality. That's really because, of course, people start to go back to school.
Later as the month goes on, you start to see the absolute numbers going down. That doesn't mean the growth rates will go down. It just means the absolute numbers will go down. It ends up being, you know, somewhere around, you know, 1%-2%. September is full-blown back to school. On a sequential basis, typically, and last year as an example, we were down 15% September from August. But that's totally normal seasonality, completely expected. I think the shape of the curve this year will be very, very similar. Q4 of last year, we had an unusual October, so I just want to make sure everyone goes back and does their homework. We had an outage, so you've got to look at the numbers.
We reported a lot of information on October last year. November, things start to pick back up around Thanksgiving, and then December is obviously a huge month with the holidays. I suspect that we're going to see the exact same trends this year because generally those have been the seasonal trends that we've seen over the years.
Yeah. I want to highlight we'll be testing our immersive advertising system sometime this year. We believe right now we don't expect that to contribute to our bookings. I do want to highlight the things I have mentioned that are iterative improvements that we're constantly making, including translation quality, search and discovery quality, efficient frontier. Those types of things may have small incremental improvements, but that's something we're doing all the time.
We'll move next to Brandon Ross with LightShed Partners. Please go ahead.
Thanks, Brandon Ross. Just looking at your DevEx fees, I think this is the first quarter that they actually went down as a percentage of bookings, as far back as we have a window into. Can you talk about what you expect the cadence of DevEx to be over time and how much pressure you feel as perhaps Epic rolls out the next version of Fortnite Creative and has potentially more significant creator splits? How much pressure you feel to match or move towards those splits? Then I have a follow-up.
Our DevEx numbers as a percentage of bookings have been pretty consistently growing over time as we suggested for literally years. We wanted to share more and more of the economics with developers. I'm looking at the supplemental materials that we posted on our site. If you look at that over the last three years, as a percentage of bookings, those numbers have gone from about 15% to 23% in Q1 and 22% last quarter. Honestly, I wouldn't read much into a 100 basis point movement in a 90-day period. I mean, DevEx is mostly a variable cost. It's driven with bookings. It goes up as bookings grows. On an absolute dollar basis, it could come down a little bit as bookings comes down. Generally, we've leaned in pretty heavily to this.
The sheer growth in our developer community is phenomenal. The sheer amount of creativity and new content is absolutely phenomenal. The economics for our developers is clearly getting better and better when we look at the amount of currency earned by the 1000th developer on the platform, those numbers are growing, you know, incredibly robustly. We just see a bigger and bigger community making a full-time living on the Roblox platform, and we're incredibly excited about that. We have a unique value proposition with our developers. It is not. We talk about this a lot, it's not about absolute take rates, it's about the level of the service and the quality of that service.
We just continue to build great relationships with our community and we'll continue to push more and more towards them over time. We have, I think a few quarters ago, said that we would, you know, be pushing towards 25%, and we're obviously in that zip code right now.
Yeah. Four years ago at the Roblox Developers Conference, I made a wild conjecture that we'd see a developer studio with more than 100 people, and it actually has come through much sooner than we thought it would happen. We're gonna continue to see both these larger studios go well beyond 100 people in the studio, which highlights the economic support they're getting from creating on our platform, as well as more developers down around 1,000 or even 10,000 who are starting to make money and, you know, filling out that super long tail of talent that's starting to build on our platform.
Great. Then in your letter when you mentioned the most engaged and most profitable cohorts that you have, I noticed they were both male cohorts. It got me to wondering what the overall split is between male and female on the platform, and what it would take, what you need to do to bring females up to parity with male engagement.
Yeah. Yeah, I wanna highlight long term. I don't know the exact ratio off the top of my head right now. I don't think we've ever shared it. Over the years, Roblox has more and more converged to exactly 50/50 on the platform. The reason is these types of platforms support everything from traditional gameplay to very social gameplay to you know, things spanning from sports to fashion, to beauty, to vehicles, you name it. We're pretty optimistic that long term, the direction continues to be towards 50/50 with a wide range of types of activity on a platform like Roblox, and I think that shows in our internal numbers.
Yeah. We've
Thank you.
Yeah. Yeah, thanks.
Now you're good.
We'll move on to the next question from Eric Handler with MKM Partners. Please go ahead.
Yes, good morning, and thanks for the question. Two questions. It seems like there's a lot of announcements in the last month or so of new brands getting involved in Roblox and the Metaverse, and I'm curious, are there enough developers out there to support all these inquiries from the various brands?
Yeah. What I believe we're seeing right now, and we saw this with print a long time ago, we saw this with video more recently, and we're gonna see this with immersive 3D going forward, is a traditional structure of service bureaus, of developers, creators who help either with graphics and video or 3D production. Our Talent Hub is serving a purpose of bringing these brands together with our creators. We have an active market for people to connect here. Many of the brands that are starting to show up on our platform are doing it unannounced, which means they're doing it in a self-service way. They are finding developers out there, either on their own or through our Talent Hub, to help them, or they're developing that expertise in-house.
We think this highlights the future where, our traditional developers have been 100% experienced developers for play or for social, but there's an emerging class of developers who are brand support developers who will complement those traditional experienced developers.
Yeah. Eric, I think these are just a classic behavior of a market in a sense. It's a great question. Right now we would hope almost that there's more demand than there is supply, because that'll be a signal to the community that this is a business that they can expand into. I was talking to a venture capitalist the other day who has now invested in a Roblox studio, which again, is a dynamic that we see as very healthy. Part of what they said was, there's a really interesting balance between their investments and the experiences that they've built and in support of brands. And that's the dynamic that we want to see. As that demand comes from brands, that will spur on more developers.
If we are potentially capacity constrained on developers right now, that's just the market dynamic that will obviously clear itself up over time. That's a really good signal.
We can see some of these larger studios hiring new college grads with computer science degrees, bringing them on board and training them in their corporate best practices for using the Roblox platform.
Yeah. I wouldn't be surprised to see agencies also taking them on.
Well, that was gonna be my next question. I mean, have you had any discussion with the big ad agencies about maybe even setting up some type of Metaverse development studio?
You know what, we'll have to defer to Craig Donato. Maybe we'll address that on Investor Day. It wouldn't surprise. Well, I know there have been inbound conversations with agencies. Whether that specifically is where we've gone, probably not. Why don't we defer that for next month and we'll dig into that.
Thank you very much.
Thanks.
We have no further questions in the phone queue. I'll turn the call over to Anna Grenholm for web questions.
I think we have time for one more question from the web. Dave, this is a question for you from Taharka Patterson from So Far So Good Incorporated. Are there any plans to collaborate with educators and local departments of education to integrate actual grade-appropriate supplemental education tools that mirror academic focus and lesson plans throughout the school year?
A great question, thank you. The vision for platforms like Roblox goes beyond coding and computer science, and it gets into simulation and ultimately allowing people to be together in real life. I'll highlight one example of a partnership that is so appropriate for Roblox and it will help so many students around the world, and that is our partnership with FIRST Robotics. FIRST Robotics has traditionally been an activity that involves creation of robots, testing them, competition, and it requires hardware, it requires kits for building robots. What we are doing with FIRST Robotics is partnering, and they're creating a simulation that mimics robot construction and testing and competition virtually on Roblox rather than in the real world.
This is a great example of an educational opportunity for many students around the world who may not have had access or opportunity to participate in a FIRST Robotics activity that can now do it on a platform like Roblox. We're really optimistic about the range of educational opportunity.
Well, that's a wrap for us. Thank you all for joining us today.
Thank you, everyone.
Thank you. That does conclude today's conference call. Thank you for your participation. You may now disconnect.