Roblox (RBLX) is offering investors limited earnings visibility after withdrawing its full-year 2026 guidance, citing weaker-than-expected monetization trends and a softer outlook for Q3, Wedbush said in a Friday note.
Roblox guided Q3 bookings to between $1.58 billion to $1.65 billion, below the $1.84 billion market consensus, Wedbush said, noting that monetization appears weakest among users under age 13 in the US and Canada.
Monetization has been pressured by a shift toward evergreen games and changes to Roblox's recommendation algorithm focused on long-term user retention, while increased investment in developer tools and 18 plus content also weighed on results, the investment firm said.
Wedbush lowered its bookings and adjusted earnings before interest, taxes, depreciation and amortization forecasts for 2026 through 2028, including cutting its 2026 bookings estimate to $6.82 billion from $7.40 billion and its adjusted EBITDA forecast to $1.14 billion from $1.51 billion.
Wedbush downgraded the stock to neutral from outperform and lowered its price target to $40 from $65.
Roblox shares were down more than 28% in Friday trading.
Price: $34.45, Change: $-14.22, Percent Change: -29.22%