The stock of Roblox (RBLX) is down 15% on May 1 after the online video game maker reported a sharp decrease in user engagement.
As part of its first-quarter financial results, Roblox reported that its new child safety measures weighed on bookings for its online platform.
In January of this year, the company restricted its online chat feature to users who completed its age-check verification.
According to the company, 73% of age-checked daily active users on Roblox were under 18, with 35% under the age of 13.
The changes to the age verification feature come after Roblox was accused of being a place for child predators to congregate anonymously online.
Roblox is currently facing over 140 lawsuits in the U.S., accusing the company of failing to protect children from sexual exploitation.
Consequently, Roblox has announced new account types for younger age groups, as well as expanded parental controls.
To account for the slowing user growth on its platform, Roblox lowered its full-year 2026 guidance, sending its share price sharply lower as a result.
The company says it now expects full-year 2026 bookings, the closest approximation to sales, of $7.33 billion U.S. to $7.6 billion U.S.
It previously forecast 2026 bookings to be almost $1 billion higher at $8.28 billion U.S. to $8.55 billion U.S.
Despite the reduced guidance, Roblox’s first-quarter financial results beat Wall Street’s forecasts.
The company reported a loss of $0.35 U.S. per share, beating the estimated loss of $0.41 U.S. It reported $1.73 billion U.S. in revenue, narrowly beating analysts’ estimates of $1.72 billion U.S.
RBLX stock is now down 42% this year and trading at $46.69 U.S. per share.
Tech Insider
