Roblox (RBLX) Q1 FY26 earnings call: guidance and Q&A

What is the rationale behind increasing the DevEx rate for the 18+ community, and why that specific number?

The DevEx increase for 18+ users is a continuation of Roblox's strategy to incentivize creators, similar to the initial introduction of DevEx. The 18+ market is 80% of the global gaming market, monetizes 1.5x higher, and age-checking allows accurate identification. This aims to make it profitable for creators to build 'novel games' for this growing segment, driving a virtuous cycle of quality content.

“The 18 and up market, now that we have age check we can know quite accurately who's a real 18 and up player. And in addition, that market globally is roughly 80% of the global gaming market... Those users also, as we shared, monetize at 1.5x where we are today.”

asked by Eric Sheridan · answered by David Baszucki

Is the entire guidance cut due to age-check behavior, and will Roblox Reality increase cloud/CapEx?

The guidance reduction is largely safety-related, stemming from the 'second order impacts' of reduced communication engagement on word-of-mouth and organic growth, and monetization-biased recommendations impacting app store ratings. Roblox Reality will not be free; it will use cloud compute, and future usage will be funded by subscriptions/payments. Current CapEx expectations for the year are unchanged, with existing GPU investments covering needs, though some cloud training costs are factored into the updated margin guidance.

“it is largely safety related. There are a number of aspects to that, as we spoke about, it's age checking. It has a follow-on impact to comms, and that affects both users that have age checked as well as those that have not.”

asked by Matthew Cost · answered by Naveen Chopra

Why such a significant guidance cut after Q1, and how does content safety balance with democratizing creation?

The guidance cut reflects a better understanding of the 'second order impacts' of age-check on comms engagement, word-of-mouth, and app store sign-ups, which primarily affects the 'top of the funnel' (new users). Retention and monetization of existing users remain strong, and the company expects DAU growth to return in Q3. On content, age-checking allows Roblox to align appropriate content with users' ages, offering a very large corpus of content for kids while allowing creators to innovate for 16+ users, thus maintaining democratization.

“What we have seen is challenges at the top of the funnel, i.e., new users coming in... But we do know that the fact that we had more sign-up headwind over the last few months is going to put pressure on bookings over the remainder of the year.”

asked by Kenneth Gawrelski · answered by Naveen Chopra

What gives confidence in Q3 DAU growth despite age-based accounts rollout, and what are the comms changes?

Confidence in Q3 DAU growth stems from seasonal strength, product changes rolling out, and the expectation that age-based accounts will not have as drastic an impact as the initial comms age-gating. Kids accounts will still access 20,000 games (97% of engagement). Comms changes include global chat (experimental), preset messages for gameplay coordination, and integrating party chat natively into experiences.

“What we're doing with kids and select accounts will have some impact... However, it's not as big a change because kids are going to come in or people who have not age checked, they will still have access to 20,000 games that represents more than 97% of the engagement on the platform from those cohorts.”

asked by Cory Carpenter · answered by Naveen Chopra

How long does it take for DevEx incentives to translate into developer response and user engagement?

Historically, the introduction of DevEx immediately led to higher quality experiences as creators could make a living on Roblox. Incremental DevEx updates have consistently shown that when creators trust they can earn revenue, they invest more effort into quality. This has been a consistent pattern throughout Roblox's history, driving higher quality content that creators can build upon.

“the second we introduced DevEx and Roblox, the quality of the experiences on Roblox got much greater, much more quickly because creators were able to make that a full-time job, dedicate their life to that.”

asked by Jason Bazinet · answered by David Baszucki

Given the DAU decline in Europe/U.S., is the viral surge of Q3 '25 still a high watermark to return to, or is retention not materializing?

The DAU trend in Europe/U.S. includes a ~4 million DAU impact from the Russia block. The company expects to return to DAU growth after addressing safety friction. Retention characteristics of users acquired through viral games last year remain strong. The current DAU weakness is primarily due to 'top of funnel' sign-ups, linked to comms friction and app store organic growth, rather than retention issues.

“The reason that DAUs have come in weaker than we expected is largely top of funnel. sign-ups, which we believe is related to what we've seen in terms of comms friction and how that's been reflected in organic growth through the app stores.”

asked by Omar Dessouky · answered by Naveen Chopra