Roblox Downgraded After $1B Bookings Cut Despite 39% Q1 Revenue Growth
Roblox was downgraded to Neutral after cutting its full-year bookings forecast by nearly $1 billion due to slower user growth from new age verification measures. First-quarter revenue rose 39% to $1.44 billion with 132 million daily active users and shares swung from an 18% plunge to a 6% rebound.
1. Piper Sandler Downgrade
On May 4, Roblox’s rating was lowered to Neutral from Overweight, reflecting concerns over limited growth potential following recent volatility and softer forward guidance.
2. Bookings Forecast Cut and User Growth Impact
The company cut its full-year bookings forecast by nearly $1 billion, attributing the weaker outlook to mandatory age verification measures that have materially slowed new user acquisition.
3. Q1 Performance and Stock Volatility
Despite the guidance reduction, first-quarter revenue increased 39% to $1.44 billion and daily active users reached 132 million. Shares plunged 18% after the earnings update but later rebounded 6%, suggesting potential market stabilization.