Roblox (RBLX) Stock Drops 23% After Analyst Downgrades and Guidance Cut

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TLDR

• Roblox dropped 23% premarket after multiple analyst downgrades following a weak Q1 report
• Q1 bookings came in at $1.73B, slightly below forecasts; DAUs of 132M missed estimates
• Full-year 2026 bookings guidance was cut to $7.33B–$7.60B, down from over $8.4B
• Age-verification rollout has hurt engagement, with only 51% of users completing it vs. a 90% target
• Average analyst price target has fallen to $63.22, though consensus rating remains “Buy”

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Roblox (RBLX) posted first-quarter bookings of $1.73 billion, just below what analysts expected. Daily active users came in at 132 million — a miss that set the tone for what followed.

Roblox Corporation, RBLX

RBLX stock fell roughly 23% in premarket trading after firms including BTIG and Raymond James cut their ratings on the stock. The sell-off reflected both the soft Q1 numbers and a steep reduction in the company’s full-year outlook.

Roblox now expects 2026 bookings of $7.33 billion to $7.60 billion. That’s well below the prior forecast of more than $8.4 billion. Adjusted EBITDA guidance was also cut by nearly $500 million.

Second-quarter bookings guidance of $1.55 billion to $1.61 billion came in below market expectations too.

A big part of the user shortfall came down to the company’s age-verification rollout. Roblox introduced stricter verification requirements that limited communication features for users who hadn’t completed the process.

Only about 51% of users have verified so far. The company’s own target was 90%. That gap has had a real impact on how people use the platform.

Analysts said the changes disrupted what Roblox calls its “social gaming” experience. Lower retention and weaker new user onboarding were the result.

Costs Rising While Growth Slows

Margin pressure is building from multiple directions. Roblox recently raised developer exchange rates for certain users, which increases payouts to creators and eats into margins.

Higher marketing spend and continued investment in AI infrastructure are adding to costs. The combination of slower growth and rising expenses is what drove the steep EBITDA guidance cut.

Changes to content discovery algorithms — intended to improve monetization — may have had the opposite effect on user experience, according to analysts. Content growth has slowed as a result.

Analyst Targets Revised

Across 30 analysts, the average 12-month price target for RBLX has dropped from $64.56 to $63.22. The range runs from $46 on the low end to $100 on the high end.

Based on the May 19 closing price, that average target still implies around 42% upside from current levels.

Despite the downgrades, the overall consensus rating across 37 analysts remains at “Buy.” The breakdown is 22 Buys and 15 Holds, with zero Sell ratings.

At the time of the update, RBLX was trading at $44.45, down $2.53 or 5.39% on the day.