Roblox drops after saying plans to prioritize safety impact may weigh on growth next year

Gaming platform Roblox, one of the industry’s biggest “black holes,” reported its third-quarter earnings on Thursday morning. Shares climbed 8% as investors digested the results, before turning negative and dropping more than 9%.

Third-quarter bookings, or the amount users spend on Roblox, rose about 70% year over year to $1.92 billion, beating Wall Street’s expectations ($1.7 billion per Bloomberg-compiled data) and better than the company’s guidance range of between $1.59 billion and $1.64 billion.

Roblox boosted its full-year booking guidance of between $5.87 billion and $5.97 billion to between $6.57 billion and $6.62 billion. Analysts polled by FactSet expected about $6.2 billion on the year.

“While the path may not be entirely linear, we are increasingly bullish about our ability to capture 10% of the $180 billion global gaming content market on Roblox and, ultimately, become one of the great global consumer internet platforms,” per management.

The reason for that less-than-linear path and the stock’s premarket reversal appear to be tied to Roblox’s safety plans. The company has been the target of several child safety lawsuits. Roblox gave updates to its safety goals, saying that it plans “to require facial estimation for all users accessing communication functions, and to limit communication between adults and minors who do not know each other in real life.” According to Roblox, these new policies “may negatively impact platform engagement in the short term”:

“As we look to next year, our long-term objectives have not changed, though we recognize that tough comps and valuable new safety features will factor into reported growth in 2026. With respect to margins, we will continue to prioritize investments to support genre expansion and long-term growth. As a result, our operating margin could decline slightly year-over-year due to the combination of higher DevEx rates and the impact of infrastructure and safety related investments catching up with rapid bookings growth in the back half of 2025.”

An average of 151.5 million daily users played Roblox on the quarter, up 70% and easily beating expectations of 132.2 million users. In the same period last year, the company reported 88.9 million daily users.

Roblox paid out $427.9 million to creators in the quarter, up from $231.5 million in the same quarter last year. Through September, payouts have now reached more than $1 billion in 2025. The platform has shattered concurrent player records with popular games like “Grow a Garden” and “Steal a Brainrot” this year. Earlier this month, Morgan Stanley called Roblox a clear leader in next-gen entertainment, making parallels to YouTube.

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