RBLX Stock Heads For Worst Day Since July As Q4 Outlook Disappoints — Analyst Flags Monetization Risks
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Roblox Daily active users dropped 9% to 138 million, and engagement hours fell 15% year over year.
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Roblox guided for a Q4 adjusted EBITDA loss of $10 million to $70 million and negative free cash flow of up to $190 million.
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Freedom Capital bucked the trend and raised its target on RBLX as the company's guidance beat its expectations.
Roblox (RBLX) shares plunged about 20% on Friday, putting the stock on track for its worst single-day decline since July, after the gaming platform reported weaker user engagement and issued a disappointing outlook for fourth-quarter bookings.
The sell-off came despite Roblox beating third-quarter revenue and bookings estimates, even as its fourth-quarter forecast indicated a 10% to 15% year-over-year decline in bookings. The company's daily active users also fell 9% to 138 million.
At the time of this writing, RBLX stock was down around 20% and was among the trending tickers on Stocktwits.
Roblox Q4 Outlook Disappoints
Roblox reported third-quarter revenue of $1.57 billion, up 16% year over year, while bookings declined 12% to $1.70 billion. Its net loss narrowed to $230 million from $258 million a year earlier.
Roblox reported nearly 34 billion hours of engagement in the third quarter, down 15% year over year but up 17% from the previous quarter. The company said the annual decline reflected difficult comparisons with growth recorded in 2025.
For the fourth quarter, Roblox projected bookings of $1.89 billion to $2 billion, below analysts' expectations of approximately $2.01 billion.
The company also forecast an adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) loss of $10 million to $70 million, alongside negative free cash flow of $105 million to $190 million.
Analyst Flags Monetization, Growth Concerns
According to TheFly, Morgan Stanley lowered its price target to $50 from $55 but maintained an 'Overweight' rating on RBLX, saying that fourth-quarter guidance disappointed expectations for a recovery in bookings. The firm, however, remained optimistic about user growth and Roblox's product pipeline.
Roth Capital cut its target to $54 while maintaining a 'Buy' rating, warning that near-term headwinds could persist for another two to three quarters. However, the firm expects new initiatives to broaden Roblox's audience and improve monetization.
Wedbush also lowered its target, citing user growth in lower-monetizing regions and among younger players. The firm highlighted 18% year-over-year growth in U.S. users aged 18 and older.
