S&P gives Roblox, notes BB

S&P said it gave BB ratings to Roblox Corp. and its planned sale of $1 billion of senior unsecured notes due 2029. The recovery rating on the notes is 3.

“We expect the company to maintain solid credit metrics even as it invests more heavily in growing the platform. Pro forma for the debt issuance, Roblox will have a net cash position of $1.8 billion and 0x S&P Global Ratings'-adjusted leverage. Roblox has also generated very strong operating metrics as it has experienced robust growth with gross bookings almost tripling over the past two years to about $2.5 billion and free operating cash flow (FOCF) of more than $300 million on a trailing-12-month (TTM) basis,” S&P said in a press release.

Roblox will use the proceeds to add cash to the balance sheet and provide flexibility to pursue acquisitions.

The outlook is stable.

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