Roblox Downgrade Follows $1B Forecast Cut Despite 39% Q1 Growth
Piper Sandler downgraded Roblox’s rating to Neutral from Overweight after the company cut its full-year bookings forecast by nearly $1 billion due to softer guidance and slower user growth. Roblox still posted 39% revenue growth to $1.44 billion and reached 132 million daily active users in Q1.
1. Piper Sandler Downgrade
On May 4, Piper Sandler lowered Roblox’s rating from Overweight to Neutral, citing limited growth potential after recent stock volatility and softer forward guidance.
2. Full-Year Bookings Forecast Cut
Roblox trimmed its full-year bookings forecast by nearly $1 billion, attributing the reduction to mandatory age verification efforts that have slowed user growth more than expected.
3. Q1 Financial Results
In the first quarter, revenue climbed 39% to $1.44 billion and daily active users reached 132 million, reflecting robust engagement despite a more cautious outlook.
4. Stock Market Response
Shares plunged 18% following the guidance cut and rating change but later rebounded 6%, indicating possible stabilization in investor sentiment.