Roblox shares dropped 19% on Friday, hitting an 18-month low after the company slashed its full-year bookings forecast, warning that new child safety measures are creating "short-term friction" and suppressing user growth.
The company now expects 2025 bookings between $7.33 billion and $7.6 billion, down sharply from the earlier forecast of $8.28 billion to $8.55 billion. Net bookings come from in-game purchases of Roblox's virtual currency, Robux.
Executives cited age-based accounts, age verification, and expanded content monitoring as factors that have restricted communication and slowed new user acquisition. The changes follow multiple regulatory probes into child safety and harmful content on the platform.
Roblox's reliance on user-generated content makes implementing safeguards costly and complex. Management believes its age-check technology will eventually be adopted across gaming, social media, and AI chatbot sectors.
Jefferies analysts said the magnitude of the forecast cut suggests limited visibility, making it hard to trust the guidance as conservative. D.A. Davidson analyst Wyatt Swanson warned that any gains before Take-Two Interactive's Grand Theft Auto VI release in November could be erased, creating headwinds for 2027 bookings.
Competition is also heating up. Fortnite made a global return to Google's app store in March, ending a long dispute between Epic Games and Google.