Roblox shares plunged nearly 30% on Friday, set for their worst one-day decline on record, after the gaming platform forecast a sharp drop in bookings. The changes to the recommendation algorithm, which prioritize games with stronger long-term retention over “cash-grabby” titles, hurt bookings as users shifted toward less-monetized experiences.
Impact on Bookings
The changes led second-quarter bookings to the low end of Roblox’s forecast range at $1.56 billion, with executives cautioning that monetization weakness could persist in the current quarter. Analysts at Wedbush downgraded the stock to neutral, citing concerns that parents are less willing to spend discretionary dollars on the platform, particularly for users under 13.
Roblox forecast its first quarterly bookings decline in four years, expecting a 14% to 18% year-over-year drop in the third quarter. The company also unveiled age-based accounts and age-verification features earlier this year, which may further pressure near-term growth.
Original reporting: Appleton, WI News Feed (HLL/CB) — read the source article.
