Hindenburg Research Accuses Roblox Corp. of Inflated Metrics and Child Safety Failures
Hindenburg stated that Roblox Corp. increased its user count by 25-43% and engagement hours by as much as 100%. Roblox Stock Falls after Hindenburg Report
Recently, Hindenburg Research accused Roblox Corp. of inflating its user metrics ignoring severe issues related to child safety on the gaming platform. According to the Hindenburg Research report, Roblox had been hiding the truth from its investors while running its business under invalid premises.
Inflated Metrics and Duplicate Users Allegations on Roblox
In its allegation, Hindenburg stated that Roblox Corp. increased its user count by 25-43% and engagement hours by as much as 100%. The Hindenberg Research alleged that Roblox miscounts its users in a deceptive manner－indicating that many of the 46 million Daily Active Users (DAUs) Roblox reports are not unique individuals, but multiple accounts opened by the same players.
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Child Safety Risks on Roblox
The Hindenburg probe exposed solicitations for sexual content involving minors, illegal activities such as theft, murder, and danger of suicide as played out in the games, and access to some chat rooms with no age restrictions. In the usernames and group names, the company also discovered references to infamous figures like Jeffrey Epstein, reportedly with dozens of Roblox groups openly trading in child pornography or soliciting sexual favours.
Hindenburg concludes that Roblox Corp. inflates its user base to make more profit from the stock market while cutting costs on moderation and safety measures.
Roblox rejected the claims made in the Hindenburg Report and said "Safety and civility have been foundational to Roblox since the company’s inception nearly two decades ago, and the company has invested heavily throughout its history in its Trust & Safety efforts. Every day, tens of millions of users of all ages have safe and positive experiences on Roblox, abiding by the company’s Community Standards. Roblox takes any content or behaviour on the platform that doesn’t abide by its standards extremely seriously, and Roblox has a robust set of proactive and preventative safety measures designed to catch and prevent malicious or harmful activity on the platform."
