Company Reports

Roblox has developed a unique business, and we don't see any peers with a similar offering from both the user and creator sides of its product. That said, the ability to sufficiently monetize customers remains a work in progress, and there is plenty of free-to-play video game competition, even if competitors don't offer the menu and constant variety of games.

Roblox had a terrible second quarter across virtually every engagement and payment metric, resulting in bookings growing only 8% year over year, after averaging at least 19% each quarter since 2022 and 55% last year. Management expects the third quarter to be weak and suspended full-year guidance.

Roblox has developed a unique business, and we don't see any peers with a similar offering from both the user and creator sides of its product. That said, the ability to sufficiently monetize customers remains a work in progress, and there is plenty of free-to-play video game competition, even if competitors don't offer the menu and constant variety of games.

A significant reduction in first-quarter daily active users and management's expectation of further declines in the second quarter led the firm to reduce its full-year bookings outlook from about 25% growth to about 10%.

After viral hits catapulted growth earlier in 2025, Roblox retained a strong number of new users and continued to improve monetization. Fourth-quarter bookings grew 63% year over year despite the absence of new viral sensations. Full-year bookings grew 55%, up from 24% in 2024.

Roblox has developed a unique business, and we don't see any peers with a similar offering from both the user and creator sides of its product. That said, the ability to sufficiently monetize customers remains a work in progress, and there is plenty of free-to-play video game competition, even if competitors don't offer the menu and constant variety of games.

Roblox has developed a unique business, and we don't see any peers with a similar offering from both the user and creator sides of its product. That said, the ability to sufficiently monetize customers remains a work in progress, and there is plenty of free-to-play video game competition, even if competitors don't offer the menu and constant variety of games.

Roblox's daily active users continued to grow at an exceptional rate in the third quarter, and revenue of $1.4 billion, along with $45 million in adjusted EBITDA, were well above management guidance. However, a weak 2026 margin and capital-expenditure forecast sent shares down 15%.

Roblox has developed a unique business, and we don't see any peers with a similar offering from both the user and creator sides of its product. That said, the ability to sufficiently monetize customers remains a work in progress, and there is plenty of free-to-play video game competition, even if competitors don't offer the menu and constant variety of games.

Roblox had an amazing second quarter, with impressive growth in users and paying users. However, the strength was driven by so-called viral hits, which could lead to unevenness in future growth. Management now expects much higher bookings in 2025, and these hits will boost future profits.

Roblox's growth accelerated in the first quarter, as it reached 98 million daily active users, or DAUs, and in-game purchasing drove up sales 31% year over year.

Roblox's bookings growth declined significantly in the fourth quarter, to 21% year over year. Daily active users, or DAUs, and hours of engagement both declined sequentially at record rates. The firm offered disappointing 2025 adjusted EBITDA guidance on a deceleration in bookings growth.

Roblox has developed a unique business, and we don't see any peers with a similar offering from both the user and creator sides of its product. That said, the ability to sufficiently monetize customers remains a work in progress, and there is plenty of free-to-play video game competition, even if competitors don't offer the menu and constant variety of games.

Roblox reported stellar third-quarter results, beating net bookings guidance by 10% and making headway in all geographic regions. The network effect that underpins our narrow moat rating was on display as increased community-generated content and the success of Roblox-sponsored events pushed engagement past 20 billion hours. Management raised full-year 2024 projections for the top and bottom lines. After adjusting our model to reflect stronger user growth, we are increasing Roblox’s fair value estimate to $55 from $53.

Roblox operates an online video game platform that lets gamers create, develop, and monetize games for other players. The firm offers developers a hybrid of a game engine, publishing platform, online hosting and services, marketplace with payment processing, and social network. Roblox is highly accessible as there is no entry cost to try out Roblox or the vast majority of user-developed games. Thus, to drive booking growth and keep the Roblox model churning along, the new user must purchase and spend Robux, the platform’s tender.

Roblox operates an online video game platform that lets gamers create, develop, and monetize games for other players. The firm offers developers a hybrid of a game engine, publishing platform, online hosting and services, marketplace with payment processing, and social network. Roblox is highly accessible as there is no entry cost to try out Roblox or the vast majority of user-developed games. Thus, to drive booking growth and keep the Roblox model churning along, the new user must purchase and spend Robux, the platform’s tender.

Narrow-moat Roblox delivered consistent results, as bookings grew 22% year over year, exceeding the high point of management’s guidance. Management said that changes made to the Roblox platform in the first quarter were positively received by users, driving a reacceleration in player engagement and the growth of daily active users. While we don’t believe Roblox will be able to increase the player base and usage at low-20% rates in the long term, usage metrics and profitability improvements this quarter have been a step in the right direction. We are increasing our fair value estimate to $53 from $50 given a slightly better outlook on growth in total bookings and the number of daily active users.

Roblox operates an online video game platform that lets gamers create, develop, and monetize games for other players. The firm offers developers a hybrid of a game engine, publishing platform, online hosting and services, marketplace with payment processing, and social network. There is no entry cost to try out Roblox or the vast majority of user-developed games. Thus, to drive booking growth and keep the Roblox model churning along, the new user must purchase and spend Robux, the platform’s tender.

Roblox delivered 19% year-over-year bookings growth during the first quarter, meeting the midpoint of management’s guidance. However, player engagement tailed off during the quarter. While management believes it has made changes to address the underlying causes of this shift, it provided a tepid outlook for second-quarter bookings growth (about 13% at the midpoint) and cut its full-year growth outlook to about 15% from 20%. Ups and downs are expected, and we’ve trimmed our growth expectations, cutting our fair value estimate to $50 from $60. We still believe that the market is overly discounting Roblox’s long-term potential and that the shares are attractive.

Roblox operates an online video game platform that lets gamers create, develop, and monetize games for other players. The firm offers developers a hybrid of a game engine, publishing platform, online hosting and services, marketplace with payment processing, and social network. There is no entry cost to try out Roblox or the vast majority of user-developed games. Thus, to drive booking growth and keep the Roblox model churning along, the new user must purchase and spend Robux, the platform’s tender.