"Bank of America noted that Roblox's Q1 bookings were 'okay' yet leading indicators deteriorated and Q2 guidance came in 'well below expectations.' The firm called the bookings guidance cut from about 24% year over year to 10% at the midpoint 'unexpected,' and trimmed its multiple to reflect uncertainty around Roblox's strategy."
"Roblox operates a user-generated 3D gaming and social platform with a market capitalization of about $31.19 billion. Q1 2026 revenue reached $1.44 billion, missing the $1.75 billion consensus by 18% despite 39% YoY growth. Daily active users hit 132 million, up 35% YoY, and free cash flow rose to $596 million."
Bank of America downgraded Roblox stock to Neutral from Buy and reduced its price target from $165 to $48 following disappointing Q1 2026 earnings. The downgrade reflects concerns over mandatory age verification and changes to discovery algorithms impacting user engagement. Roblox's Q1 bookings were deemed 'okay,' but guidance for Q2 fell significantly short of expectations. Other analysts also adjusted their price targets, with some downgrading and others maintaining or upgrading their ratings, indicating mixed sentiments about Roblox's future performance.
Read at 24/7 Wall St.
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