Roblox (RBLX.US) Q3 daily active users fall short of expectations: ongoing pain from child safety restructuring, stock plunges over 17% after hours

According to Zhihui Financial APP, Roblox (RBLX.US) reported that its third-quarter user numbers did not meet analysts’ expectations, as questions remain about whether a new popular game can reverse the recent decline in user engagement caused by stricter child safety measures. The financial report shows that the company’s revenue reached $1.572 billion, up 16% year-on-year; net loss narrowed to $230 million, with a loss per share of $0.32, better than the market expectation of $0.42; adjusted EBITDA stood at $138 million, far above the $46 million from the same period last year.

User data was the main drag. Daily active users (DAU) were 138 million, down 9% year-on-year and below analysts’ forecast of 145.8 million; total user engagement time was about 34 billion hours, down 15% year-on-year. Bookings were $1.697 billion, down 12% year-on-year, but above Wall Street’s expectation of $1.63 billion and the company’s own guidance upper limit.

Roblox shares plunged more than 17% after hours, falling 17.50% to $43.28 at the time of publication.

The company attributed the decline to the high base in 2025—when hit games like “Steal A Brainrot” and “Grow A Garden” set industry records—as well as the impact of child safety measures. For years, Roblox has faced lawsuits from multiple state attorneys general over predators on its platform and subsequently rolled out dozens of safety reforms, including age verification. These measures pressured growth in the first two quarters of the year, but the company is betting the reforms will ultimately bring a broader user base.

The new game “Steal An Egg,” which launched over the summer, briefly raised market hopes. According to Freedom Capital Markets analyst Nick McKay, the game contributed up to half the platform’s concurrent users on certain days; however, he warned the boost may be “overestimated”—as some of the popularity may be due to users shifting from legacy hits like “Steal A Brainrot.”

CEO David Baszucki emphasized in a shareholder letter that Q3 revenue, bookings, and cash flow all exceeded company guidance, and that AI is reshaping game content creation—while Roblox’s distribution, economic system, and safety infrastructure form its core competitive strengths.

In terms of guidance, the company expects Q4 bookings to be between $1.89 billion and $2.0 billion, down 10% to 15% year-on-year; Q4 adjusted EBITDA is expected to be negative $70 million to negative $10 million, and free cash flow is forecast at negative $190 million to negative $105 million (partly due to capital expenditures shifting from Q3 to Q4). In July, the company said that AI investment will increase infrastructure costs and suspended full-year guidance. In Q3, the company repurchased 4.4 million shares (about $200 million), with remaining share repurchase authorization of about $2.4 billion.