Roblox Corp. shares plunged after management sharply reduced its bookings outlook for full-year 2026, pointing to drag from a mandatory age-verification rollout and the loss of access to the Russian market. The company said the changes constrained on-platform communication for users who had not completed the age checks and slowed new user acquisition.
For the first quarter, Roblox reported bookings of $1.7 billion, slightly under the analyst estimate of $1.74 billion. Revenue was $1.4 billion, a 39% year-over-year gain, but it missed the $1.42 billion consensus. Adjusted earnings per share came in at negative $0.35, beating the expected loss of $0.41.
Key engagement metrics lagged expectations. Daily active users reached 132 million in the quarter, short of the 143.8 million analysts had forecast. Total hours engaged by users were 31 billion, versus the 33.68 billion estimate.
Management took a notably more cautious posture on bookings for 2026, revising the full-year range to $7.33 billion to $7.6 billion, down from the previous guidance of $8.28 billion to $8.55 billion. The revised midpoint of $7.47 billion sits well below the analyst consensus of $8.38 billion. Looking into the second quarter, Roblox guided bookings of $1.55 billion to $1.61 billion, with a midpoint of $1.58 billion that is materially below the $1.88 billion consensus.
"While our aggressive push to enhance safety lowers our expectations for topline growth in 2026, it makes our platform fundamentally better and amplifies the long-term growth potential of Roblox," the company stated in its shareholder letter.
Company commentary tied the guidance reduction primarily to the mandatory age-check rollout that began in January, which limited communication features for users who had not completed the checks and slowed the pace of new user acquisition. Roblox also noted that a platform ban in Russia, effective December 2025, contributed to the deceleration in growth.
Despite these near-term headwinds, Roblox produced $596 million in free cash flow in the quarter, a 40% increase year-over-year and ahead of the $564.5 million estimate. The company also introduced Roblox Plus, a $4.99-per-month subscription aimed at strengthening retention among its most engaged users.
The stock reaction reflected investor reassessment of near-term revenue momentum after the guidance cut, even as profitability and cash generation metrics showed improvement.