Roblox Revenue Climbs 16% While Bookings Fall 12%, And Free Cash Flow Turns Negative In Guidance
Roblox guides to a 10% to 15% bookings decline and negative free cash flow for the fourth quarter.
Roblox, which runs an online platform where people play and build 3D games, reported third-quarter revenue up 16% to $1.57 billion even as bookings, the measure of what players actually spent, fell 12% to $1.70 billion. In a shareholder letter furnished with an 8-K on Thursday, it guided to a fourth-quarter bookings decline of 10% to 15%.
Revenue up, bookings down
Revenue compares with $1.36 billion a year earlier, while bookings compare with $1.92 billion. Bookings still topped the high end of the company's guidance range, and Roblox said the decline reflects a comparison with the extraordinary growth of 2025. It said third-quarter bookings were up over 50% on a two-year basis.
Revenue and bookings diverge because Roblox recognizes most bookings as revenue over 27 months, the estimated average lifetime of a paying user. That is also why it expects fourth-quarter revenue growth of 4% to 12% despite lower bookings.
The net loss was $230 million, or $0.32 per share, against $258 million a year earlier. Adjusted EBITDA rose to $138 million from $46 million; the adjusted figure leaves out stock-based compensation of $298 million and, this quarter, $49 million of legal settlement expenses tied to talks with certain states and territories over youth consumer protection and digital safety.
Users shrink year over year
Daily active users were 138 million, down 9% from a year earlier but up 12% from the second quarter. Hours engaged reached nearly 34 billion, down 15% year over year, as Roblox lapped tough 2025 comparisons. Average monthly unique payers were 30 million, down 16%, though bookings per payer rose 5%.
Roblox is pushing to widen its adult audience. Users 18 and over made up 29% of global age-checked daily users, up from 27% in the second quarter.
Negative free cash flow ahead
For the fourth quarter, Roblox guided to free cash flow of negative $190 million to negative $105 million. The range includes a shift of capital spending from the third quarter into the fourth, with spending guided to $380 million. Third-quarter free cash flow was $364 million, versus $443 million a year earlier.
The company also guided to adjusted EBITDA of negative $70 million to negative $10 million. It repurchased 4.4 million shares for about $200 million in the quarter and has roughly $2.4 billion of authorization left. Cash and investments stood at $6.2 billion.
The AI bet
Roblox says more than 80% of its top 100 games used AI tools over the past month. In the first half of next year it expects to start publishing select top games to outside app stores through Roblox Everywhere, and it plans to bring Roblox Reality to early access in the first half of 2027.
Roblox will hold its webcast and Q&A at 4:30 p.m. Eastern on Thursday.
