Roblox faces Q2 earnings test as DAU declines mount

Roblox Corp. reports second-quarter earnings July 30, with analysts projecting a 43% revenue gain to $1.6 billion but another drop in daily active users.

"The age-verification rollout has hindered on-platform communication, reducing user interaction and organic sign-ups," the company said in its Q1 filing, attributing the DAU decline to the safety feature.

Analysts expect Roblox to post a loss of $0.34 per share on revenue of $1.6 billion, according to consensus estimates compiled by MarketBeat. In Q1, the company reported a $0.35 loss on $1.44 billion in revenue — a 43% year-over-year increase but a miss versus the $1.74 billion consensus. DAUs fell sequentially in the period, and engagement hours have declined from their 2025 peak.

The results come as Roblox faces a securities class action lawsuit over disclosures about its age-verification rollout, which erased $6.7 billion from its market capitalization after the Q1 report. The stock closed at $49.76 on July 23, down 67% from its 52-week high of $150.59 and 15% below its 200-day moving average of $58.28.

The company's $3 billion share buyback authorization, announced May 19, signals management believes the stock is undervalued. Insiders sold 161,983 shares worth $7.6 million in the past 90 days, primarily to cover tax withholding obligations on vested equity awards, according to SEC filings. Institutional investors hold 94.5% of the float.

Roblox unveiled Build, a mobile-first creation tab with AI tools that convert text prompts into playable game prototypes, in a bid to deepen engagement and broaden its creator base. Analysts at HSBC downgraded the stock to hold from buy with a $46 price target, while Canaccord Genuity cut its target to $80 from $140 but maintained a buy rating. The stock carries a consensus rating of moderate buy with a price target of $85.85, according to MarketBeat.

The Q2 report will test whether the DAU decline is stabilizing or accelerating. Investors will watch the July 30 earnings call for updated guidance on user metrics and the financial impact of the ongoing litigation, which has drawn claims from shareholders who purchased stock between Oct. 30, 2025 and April 30, 2026.

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