Roblox drew fresh analyst scrutiny on Friday after reporting quarterly results and guidance that analysts said reflected a slowing of monetization tied to an ongoing platform transition.
BMO Capital Markets revised its stance on the gaming and user-created content platform, lowering its rating from Outperform to Market Perform and reducing its price target to $45 from $100. BMO attributed the quarterly shortfall to changes in user engagement: time spent and spending appear to be shifting away from highly monetizing viral games that dominated in 2025 toward newer and evergreen titles that generate lower revenue per hour. That dynamic, the firm said, produced a 2.5% miss on bookings for the quarter. BMO also noted that third-quarter guidance was provided at a midpoint that sits about 12.5% below consensus Street estimates.
Looking ahead, BMO signaled that the pressure on engagement and monetization could persist for multiple quarters. The firm flagged the fourth quarter of 2026 as a period of particular concern as it expects additional headwinds around the launch of GTA VI.
Deutsche Bank took a similar view, cutting its rating on Roblox from Buy to Hold and trimming its target to $38 from $56. The bank said the quarter "materially reduces near-term visibility." It reported that bookings of $1,557 million landed at the low end of company guidance and were roughly 3% below consensus forecasts.
Deutsche Bank and BMO pointed to a company guidance update that included a withdrawn full-year outlook and a forecast the firm described as the first year-over-year decline in company history. Executives attributed much of the signal to a recommendation-algorithm change implemented in April. That change, the analysts said, intentionally sacrifices some near-term monetization to prioritize user retention.
Despite the downgrades and lowered estimates, both firms left open the possibility of a sustainable long-term trajectory for the business. Deutsche Bank highlighted potential upside if discovery on the platform improves, safety standards are strengthened, and the over-18 user segment expands Roblox’s addressable market. BMO emphasized increasing age-verification rates as a positive indicator.
Nonetheless, both firms trimmed their financial forecasts. Deutsche Bank added that it expects Roblox shares to remain range-bound until monetization in the U.S., Canada and Australia region stabilizes.
Contextual note: The analysis from both firms centers on the timing and pace of Roblox’s platform transition and its effects on bookings and guidance. The firms preserved the view that the company has a credible long-term opportunity while emphasizing the near-term uncertainty stemming from product and algorithm changes.