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Roblox forecast annual bookings below market estimates on Thursday, sparking fears growth at the videogame platform was slowing after years of breakneck progress, sending its shares down 26% in premarket trading.
The company said it expects bookings for 2025 to be between $5.20 billion and $5.30 billion, the midpoint of which was below estimates of $5.27 billion according to data compiled by LSEG.
Roblox’s forecast adds to worries about the videogame industry’s health, after a lackluster outlook from Electronic Arts, which blamed weak bookings – a key measure of in-game spending – on its struggling soccer franchise.
Still, Roblox’s projection points to a third consecutive year of roughly 20% growth in bookings, even as rivals grapple with a slowdown in spending from customers stung by sticky inflation.
“We’re growing at a substantial premium to the overall gaming market. Right now, gaming is barely growing as a category,” outgoing CFO Michael Guthrie told Reuters.
The overall videogame industry, in comparison, likely grew by 2.1% in 2024, according to research firm Newzoo.
A push into new game genres, including those for older players, has fueled rapid growth at Roblox over the past two years and unlocked new revenue streams in ads and e-commerce.
The company has also benefited from a surge in user-generated content and its free-to-play model, which has helped Roblox buck the broader slowdown in videogame spending.
However, daily active users, a key metric that determines engagement, fell slightly to 85.3 million in the three months ended December 31, from 88.9 million in the prior quarter. Fourth-quarter bookings of $1.36 billion also missed estimates of $1.37 billion.
Guthrie blamed the weaker growth on tough comparisons with the year-ago quarter, when Roblox launched on Sony’s PlayStation consoles, driving a wave of new sign-ups and higher spending.
He also cited the platform’s suspension in Turkey, where it was banned over safety and child abuse concerns — an issue that has long dogged Roblox, drawing lawsuits and public scrutiny.
