Roblox Corporation
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Financial statements
data from SEC XBRL filings. Values are as-reported; restatements supersede originals.
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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.
The following discussion and analysis of our financial condition, results of operations, and cash flows should be read in conjunction with our unaudited condensed consolidated financial statements and related notes appearing elsewhere in this Quarterly Report on Form 10-Q and our audited consolidated financial statements and the related notes and the discussion under the heading “Management’s Discussion and Analysis of Financial Condition and Results of Operations” for the fiscal year ended December 31, 2025 included in our Annual Report on Form 10-K filed with the SEC (the “2025 Annual Report”). This discussion and analysis and other parts of this Quarterly Report on Form 10-Q contain forward-looking statements, such as those relating to our plans, objectives, expectations, intentions, and beliefs, that involve risks, uncertainties, and assumptions. Our actual results could differ materially from these forward-looking statements as a result of many factors, including those discussed in the section titled “Risk Factors,” “Special Note Regarding Forward-Looking Statements,” and “Special Note Regarding Operating Metrics” included elsewhere in this Quarterly Report on Form 10-Q. Our historical results are not necessarily indicative of the results that may be expected for any periods in the future. Unless the context otherwise requires, all references in this report to “Roblox,” the “Company,” “we,” “our,” “us,” or similar terms refer to Roblox Corporation and its subsidiaries.
Because certain reported amounts are rounded, the sum of the respective components reported for these amounts may not equal the total amount reported and the percentages presented may not add to their respective totals. Additionally, certain columns and rows may be presented as zero or not presented at all due to rounding to zero.
Overview
People from around the world come to Roblox every day to connect. Together they create, play, work, learn, and connect with each other in games built by our global community of creators. Roblox is powered by user-generated content and draws inspiration from gaming, entertainment, social media, and even toys.
Our immersive gaming and creation Platform consists of the Roblox Client, the Roblox Studio, and the Roblox Cloud (collectively, the “Roblox Platform” or the “Platform”). Roblox Client is the free application that allows users to explore immersive games. Roblox Studio is the free toolset that allows creators to build, publish, and operate immersive games and other content accessed with the Roblox Client. Roblox Cloud includes the services and infrastructure that power our Platform. We are continually innovating our Platform by investing in high fidelity avatars, more realistic games, artificial intelligence (“AI”) tools, and other connection features.
Our mission is to connect a billion users with optimism and civility. We are constantly improving the ways in which our Platform supports shared games, ranging from how these games are built by an engaged community of creators to how they are enjoyed and safely accessed by users across the globe. We also believe there is a strong potential to capture a greater percentage of the global gaming market within the Roblox ecosystem. Our goal is to make it as easy as possible for creators to build better and safer games, and ultimately reach more users. We continue to invest in creating tools for our creators designed to promote key game genres and deepen engagement on our Platform.
Consistent with our free to use business model, a small portion of our users have historically been payers. For example, in the three months ended March 31, 2026, of our 132 million average Daily Active Users (“DAUs”), only approximately 1.9 million represented our average daily unique paying users. Similarly, in the three months ended March 31, 2026, our average daily bookings per DAU was $0.15, whereas our average daily bookings per daily unique paying user was $10.17. We believe that maintaining and growing our overall number of users, including the number of users who may not purchase and spend Robux, is important to the success of our business. As a result, we believe that the number of users who choose to purchase and spend Robux will continue to constitute a small portion of our overall users.
We are constantly innovating our safety tools and launching new safeguards to promote a safe and enjoyable environment for our users. As our safety teams continue to innovate and use advancements in technology to help users feel safe on our Platform, we expect to continue to implement Platform policy, product, technology and other changes, including in anticipation of and in response to regulatory requirements and evolving guidance from leading global organizations focused on child and internet safety in the U.S. and abroad. We continue to develop, test, and implement new systems designed to age-check users prior to accessing chat on our Platform. In addition, we recently announced Roblox Kids and Roblox Select, which are new account types designed to provide children and younger teens with age-appropriate games and safety features that we intend to launch in June 2026. Our safety changes have impacted and may continue to impact engagement, retention, revenue, and bookings.
Our primary areas of investment have been, and we expect will continue to be, our creator community, and the people, technology, and infrastructure, including our trust and safety systems, required to keep improving the Roblox Platform while maintaining and building a safe and civil digital community. These areas of focus are how we drive the business, and along with payment processing fees, represent our primary operating costs.
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Key Metrics
We believe our performance is dependent upon many factors, including the key metrics described below that we track and review to measure our performance, identify trends, formulate financial projections, and make strategic decisions.
Operating Metrics
We manage our business by tracking several operating metrics, including those outlined below. As a management team, we believe each of these operating metrics provides useful information to investors and others. For complete definitions and limitations of these metrics, refer to the section titled “Special Note Regarding Operating Metrics” of this Quarterly Report on Form 10-Q.
Average Daily Active Users (“DAUs”)
We define a DAU as a user who has logged in and visited Roblox through our website or application on a unique registered account on a given calendar day. If a registered, logged in user visits Roblox more than once within a 24-hour period that spans two calendar days, that user is counted as a DAU only for the first calendar day. We track DAUs as an indicator of the size of the audience engaged on our Platform. We believe that the long-term growth in DAUs reflects the increasing value of our Platform.
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Hours Engaged
We define hours engaged as the time spent by our users on the Platform. We calculate total hours engaged as the aggregate of user session lengths in a given period. We estimate this length of time using internal company systems that track user activity on our Platform as discrete events, and aggregate these discrete activities into a user session. A given user session on our Platform may include, among other things, time spent in games, in Roblox Studio, in Platform features such as chat and avatar personalization, in the Creator Store, and some amount of non-active time due to limits within the tracking systems and our estimation methodology. We believe that the long-term growth in hours engaged reflects the increasing value of our Platform.
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Bookings
Bookings is a non-GAAP financial measure and represents the sales activity in a given period without giving effect to certain non-cash adjustments. Bookings is presented for supplemental informational purposes only and should not be considered in isolation from, or as a substitute for, financial information presented in accordance with GAAP. Refer to the section “Non-GAAP Financial Measures” below for further discussion on this measure, including its limitations.
Below we also include revenue calculated in accordance with GAAP, the most directly comparable financial measure to bookings.
Generally over time, as the content and functionality of our Platform improves and DAUs increase in tenure, hours engaged tend to go up. Similarly, we expect more users to become payers. Further, we expect growth in our payers and improvements in our products and strategy to lead to growth in revenue and bookings. Within any given period, the relative behavior of the metrics has not been, and will not always be, consistent. Additionally, engagement and monetization trends may vary depending on a wide variety of factors, including, but not limited to, the popularity and virality of certain games and the mix of users from different regions.
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Average Bookings per DAU (“ABPDAU”)
We define ABPDAU as bookings in a given period divided by the DAUs for the same period. We use ABPDAU as a way to understand our monetization across our users.
Refer to the section titled “Non-GAAP Financial Measures” for the definition of and discussion on bookings, including its limitations as a non-GAAP financial measure.
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Average Monthly Unique Payers
We define monthly unique payers as user accounts that made a payment on the Platform or redeemed a prepaid card during a given month. Average monthly unique payers for a specified period is the average of the monthly unique payers for each month during that period. We use this measure to understand our monetization across our payers.
Average Bookings per Monthly Unique Payer
We define average bookings per monthly unique payer as bookings in the specified period divided by the average monthly unique payers for the same specified period. We use this measure to understand our monetization across our payers through the sale of virtual currency and subscriptions. Refer to the section titled “Non-GAAP Financial Measures” for the definition of and discussion on bookings, including its limitations as a non-GAAP financial measure.
Non-GAAP Financial Measures
In addition to our results determined in accordance with GAAP, we believe the following non-GAAP financial measures are useful in evaluating our performance: bookings, Adjusted EBITDA, and free cash flow. We use this non-GAAP financial information to evaluate our ongoing operations and for internal planning and forecasting purposes. We believe that this non-GAAP financial information may be helpful to investors because it provides consistency and comparability with past financial performance. However, non-GAAP financial measures have limitations in their usefulness to investors because they have no standardized meaning prescribed by GAAP and are not prepared under any comprehensive set of accounting rules or principles. In addition, other companies, including companies in our industry, may calculate similarly titled non-GAAP financial measures differently or may use other measures to evaluate their performance, all of which could reduce the usefulness of our non-GAAP financial information as a tool for comparison. As a result, our non-GAAP financial information is presented for supplemental informational purposes only and should not be considered in isolation from, or as a substitute for financial information presented in accordance with GAAP.
Reconciliation tables of the most comparable GAAP financial measure to each non-GAAP financial measure used in this Quarterly Report on Form 10-Q are included below. We encourage investors and others to review our business, results of operations, and financial information in their entirety, not to rely on any single financial measure, and to view these non-GAAP measures in conjunction with the most directly comparable GAAP financial measures.
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Bookings
Bookings represent the sales activity in a given period without giving effect to certain non-cash adjustments, as detailed below. Substantially all of our bookings are generated from sales of virtual currency, which can ultimately be converted to virtual items on the Roblox Platform. Sales of virtual currency reflected as bookings include one-time purchases or monthly subscriptions purchased via payment processors or through prepaid cards. Bookings are initially recorded in deferred revenue and recognized as revenues over the estimated period of time the virtual items purchased with the virtual currency are available on the Roblox Platform (estimated to be the average lifetime of a paying user) or as the virtual items purchased with the virtual currency are consumed. Bookings also include an insignificant amount from advertising and licensing arrangements.
We believe bookings provide a timelier indication of trends in our operating results that are not necessarily reflected in our revenue as a result of the fact that we recognize the majority of revenue over the estimated average lifetime of a paying user. The change in deferred revenue constitutes the vast majority of the reconciling difference from revenue to bookings. By removing these non-cash adjustments, we are able to measure and monitor our business performance based on the timing of actual transactions with our users and the cash that is generated from these transactions. Over the long term, the factors impacting our revenue and bookings trends are the same. However, in the short term, there are factors that may cause revenue and bookings trends to differ.
The following table presents a reconciliation of revenue, the most directly comparable financial measure calculated in accordance with GAAP, to bookings, for each of the periods presented (in millions):
| Three Months Ended March 31, | |||||||||||||||||||
| 2026 | 2025 | ||||||||||||||||||
| Reconciliation of revenue to bookings: | |||||||||||||||||||
| Revenue | $ | 1,442 | $ | 1,035 | |||||||||||||||
| Add (deduct): | |||||||||||||||||||
| Change in deferred revenue | 299 | 178 | |||||||||||||||||
| Other | (10) | (6) | |||||||||||||||||
| Bookings | $ | 1,731 | $ | 1,207 | |||||||||||||||
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Adjusted EBITDA
Adjusted EBITDA represents our GAAP consolidated net loss, excluding interest income, interest expense, other (income)/expense, net, provision for/(benefit from) income taxes, depreciation and amortization expense, stock-based compensation expense, and certain other non-routine adjustments and differs from Covenant Adjusted EBITDA which is used in certain covenant calculations specified in the indenture governing our senior notes due 2030 (the “Indenture”). Refer to the section titled “Liquidity and Capital Resources” for the definition of and discussion on Covenant Adjusted EBITDA.
We believe that, when considered together with reported GAAP amounts, Adjusted EBITDA is useful to investors and management in understanding our ongoing operations and operating trends. Our definition of Adjusted EBITDA may differ from the definition used by other companies and therefore comparability may be limited.
The following table presents a reconciliation of consolidated net loss, the most directly comparable financial measure calculated in accordance with GAAP, to Adjusted EBITDA, for each of the periods presented (in millions):
| Three Months Ended March 31, | |||||||||||||||||||
| 2026 | 2025 | ||||||||||||||||||
| Reconciliation of consolidated net loss to Adjusted EBITDA: | |||||||||||||||||||
| Consolidated net loss | $ | (248) | $ | (216) | |||||||||||||||
| Add (deduct): | |||||||||||||||||||
| Interest income | (55) | (46) | |||||||||||||||||
| Interest expense | 10 | 10 | |||||||||||||||||
| Other (income)/expense, net | (2) | (4) | |||||||||||||||||
| Provision for/(benefit from) income taxes | 1 | 1 | |||||||||||||||||
Depreciation and amortization expense | 61 | 54 | |||||||||||||||||
| Stock-based compensation expense | 275 | 259 | |||||||||||||||||
Legal settlement expenses(1) | 57 | — | |||||||||||||||||
| Adjusted EBITDA | $ | 99 | $ | 58 | |||||||||||||||
(1)Includes legal settlement expenses related to settlement negotiations with certain states regarding youth-related consumer protection and digital safety matters. The Company has determined that these matters arise outside of the ordinary course of business, have limited historical precedent, are unpredictable in their magnitude, scope, and timing, and as a result are distinct from routine expenses incurred in ongoing operations.
Free cash flow
Free cash flow represents the net cash and cash equivalents provided by operating activities, less purchases of property and equipment, and intangible assets acquired through asset acquisitions. We believe that free cash flow is a useful indicator of our unit economics and liquidity that provides information to management and investors about the amount of net cash and cash equivalents generated from our core operations that, after the purchases of property and equipment, and intangible assets acquired through asset acquisitions, can be used for strategic initiatives.
The following table presents a reconciliation of net cash and cash equivalents provided by operating activities, the most directly comparable financial measure calculated in accordance with GAAP, to free cash flow, for each of the periods presented (in millions):
| Three Months Ended March 31, | |||||||||||
| 2026 | 2025 | ||||||||||
| Reconciliation of net cash and cash equivalents provided by operating activities to free cash flow: | |||||||||||
| Net cash and cash equivalents provided by operating activities | $ | 629 | $ | 444 | |||||||
| Deduct: | |||||||||||
| Acquisition of property and equipment | (33) | (17) | |||||||||
| Free cash flow | $ | 596 | $ | 427 | |||||||
Acquisition of property and equipment primarily includes leasehold improvements related to our leased office spaces and data centers, servers, infrastructure equipment, and capitalized software licenses.
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Components of Results of Operations
Revenue
We generate substantially all of our revenue through the sale of or access to virtual items to users, enabling them to enhance their experience on the Roblox Platform. We recognize revenue over the estimated period of time the virtual items are available to the user on the Roblox Platform (estimated average lifetime of a paying user) which we refer to as durable virtual revenue, or at the time the virtual item is consumed, which we refer to as consumable revenue. We expect the mix of durable and consumable revenues to fluctuate based on user purchasing preferences, the variety of virtual content being offered by creators, and seasonal variations, amongst other factors, with higher consumable virtual item purchases resulting in higher revenue from bookings generated in the same period.
The estimated average lifetime of a paying user is calculated based on the monthly retention data for each paying user cohort. We then calculate the average retention period by determining the weighted-average period paying users have spent on the Platform and are projected to participate on the Roblox Platform.
Other revenue streams include an insignificant amount of revenue from advertising and licensing arrangements. We plan to invest in and expand our advertising business for the foreseeable future.
All of our revenue is recorded net of taxes assessed by a government authority that are both imposed on and concurrent with specific revenue transactions between us and our users, and estimated chargebacks and refunds.
Costs and expenses
We allocate shared costs, such as certain facilities (including rent and depreciation on equipment and leasehold improvements shared by all departments), certain software costs, and certain other operating expenses, to all departments based on headcount. As such, allocated shared costs are reflected in each expense category, with the exception of cost of revenue and developer exchange fees expense.
Personnel costs generally include employee expenses (salaries, benefits, and stock-based compensation expense) and contractor expenses, and are reflected in each expense category, with the exception of cost of revenue and developer exchange fees. In the three months ended March 31, 2026 and 2025, personnel costs were $565 million and $497 million, respectively.
Cost of revenue
Cost of revenue primarily consists of third-party payment processing fees charged by the various distribution channels in connection with sales of our virtual currency. We initially defer payment processing fees and recognize them as expense over the same period as the respective revenue. Cost of revenue also includes sales tax expense for jurisdictions where the Company does not collect sales tax from the purchaser at the time of the sale and costs associated with the printing of prepaid cards.
Cost of revenue as a percentage of revenue is affected by shifts in user purchasing preferences and trends, including those influenced by Robux offerings made by the Company, such as differential Robux pricing. Differential Robux pricing offers more Robux for users purchasing Robux through payment processing channels with lower transaction processing fees. Since the introduction of differential Robux pricing, we have seen some shift of our sales towards distribution channels with lower transaction processing fees, such as desktop and prepaid cards. In the future, we expect the overall distribution channel mix to shift based on user purchasing preferences, including those influenced by Robux offerings made by the Company, demographics, and seasonal variations.
Developer exchange fees
Developer exchange fees expense represent the fiat currency amount that qualified and registered creators in the Developer Exchange Program are eligible to be paid. Creators that qualify for our Developer Exchange Program are eligible to be paid fiat currency by Roblox based on the amount of earned Robux the creator has accumulated through the Platform. Creators must meet certain conditions, such as having accumulated the minimum amount of earned Robux required to qualify for the program, and having a verified creator account in good standing to be eligible to participate in our Developer Exchange Program. Creators can accumulate earned Robux by monetizing a developed game, IP licensing, creating and selling avatar items, or creating and selling Roblox Studio plugins.
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Through July 23, 2025, creators were also able to accumulate earned Robux through our Engagement-Based Payouts (“EBP”) Program which allowed creators to accumulate earned Robux based on the share of time that Roblox Premium subscribers engage in their game. Beginning July 24, 2025, our EBP Program was replaced by our Creator Rewards Program that allows creators who publish games to accumulate earned Robux based on the achievement of various metrics that we believe drive user engagement and monetization supporting the long-term health of our Platform. We expect that moving forward, the aggregate developer exchange fee expense related to the Creator Rewards Program will exceed the aggregate developer exchange fee expense related to the legacy EBP Program.
On January 31, 2022, we reduced the minimum amount of earned Robux required to qualify for the Developer Exchange Program from 100,000 Robux to 50,000 Robux and subsequently on January 31, 2023, we further reduced the minimum requirement from 50,000 Robux to 30,000 Robux. We believe these reductions in the minimum amounts required incentivize our creator community, while promoting its long-term growth and health. As of March 31, 2026, over 38,000 creators qualified for and were registered in our Developer Exchange Program.
We continue to focus on increasing creator earnings by (i) creating new earnings methods and enhancing existing ones and (ii) passing on efficiencies realized in other areas of our business. For example, beginning September 5, 2025 and applying prospectively, we increased the amount creators can receive in fiat currency based on earned Robux by 8.5%. Furthermore, we recently announced an increase in our Developer Exchange rate designed to further reward creation of novel games. Starting June 8, 2026, we will increase the effective earnings for eligible in-game spend generated by age-checked U.S. users 18 or older.
Infrastructure and trust & safety
Infrastructure and trust & safety expenses consist primarily of expenses related to the operation of our data centers and technical infrastructure. These costs include third-party service provider costs, such as cloud computing or other hosting and data storage, facilities-related expenses for our co-located data centers and edge data centers that we lease and operate, and network and bandwidth costs, as well as depreciation and associated support and maintenance costs of our servers and infrastructure equipment. Depreciation and amortization expense related to infrastructure and trust & safety in the three months ended March 31, 2026 was $54 million and in the three months ended March 31, 2025 was $44 million.
We plan to continue increasing the capacity, capability, and reliability of our infrastructure to support more sophisticated content, more users, and increased engagement. Over the long term, as our Platform continues to grow, we expect to increase our investment to support our global infrastructure, including expanding our graphics processing units infrastructure both in our owned and operated data centers and in the public cloud. We intend to achieve scalability by building and maintaining our own technical infrastructure, while generating operating leverage over the long term.
Infrastructure and trust & safety expenses also include personnel costs, moderation and customer support related costs, and allocated overhead expenses. We have been and expect to continue investing in AI and automation to increase the accuracy and efficiency of our safety moderation and customer support related efforts, which has increased the quality of our safety and civility systems.
Research and development
Research and development expenses consist primarily of personnel costs and allocated overhead expenses for our engineering, design, product management, data science, and other employees engaged in maintaining and enhancing the functionality of the Platform. We plan to increase research and development expenses for the foreseeable future primarily driven by increased headcount to develop new features, functionality, and innovation of our Platform.
General and administrative
General and administrative expenses consist primarily of personnel costs and allocated overhead for our finance and accounting, legal, human resources, talent acquisition, and other administrative teams. General and administrative expenses also include professional services fees such as outside legal, accounting, audit, outsourcing services, and other corporate expenses, as well as certain accruals and settlements associated with legal proceedings. We generally expect general and administrative expenses to increase for the foreseeable future, primarily to support the growth and increasing complexity of our business.
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Sales and marketing
Sales and marketing expenses consist primarily of personnel costs and allocated overhead for our marketing, business development, brand partnerships, and developer relations functions, as well as user acquisition expenses. Other expenses include those associated with market research, branding, public relations, and developer relations programs, including our annual Roblox Developer Conference. We plan to increase our sales and marketing expenses for the foreseeable future, primarily to support the growth of our business.
Interest income
Interest income consists primarily of interest earned and accretion/(amortization) of our short-term investments, long-term investments, and cash equivalents.
Interest expense
Interest expense consists primarily of contractual interest and amortization of debt issuance costs on our 3.875% Senior Notes due 2030 (the “2030 Notes”).
Other income/(expense), net
Other income/(expense), net primarily includes foreign currency exchange gains/(losses) and realized gains/(losses) on our short-term and long-term investments.
Provision for/(benefit from) income taxes
Provision for/(benefit from) income taxes consists primarily of income taxes in foreign jurisdictions and U.S. federal and state income taxes. We maintain a full valuation allowance on our federal, state, and certain foreign deferred tax assets as we have concluded that it is not likely that the deferred assets will be utilized.
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Results of Operations
The following tables set forth our results of operations for the periods presented in dollars and as a percentage of our revenue for each period presented (in millions, except number of shares which are reflected in thousands, per share data, and percentages):
Three Months Ended March 31, | |||||||||||||||||||||||||||||||||||||||
| 2026 | 2025 | ||||||||||||||||||||||||||||||||||||||
| Revenue | $ | 1,442 | 100 | % | $ | 1,035 | 100 | % | |||||||||||||||||||||||||||||||
Costs and expenses: | |||||||||||||||||||||||||||||||||||||||
Cost of revenue(1) | 294 | 20 | 225 | 22 | |||||||||||||||||||||||||||||||||||
| Developer exchange fees | 423 | 29 | 282 | 27 | |||||||||||||||||||||||||||||||||||
Infrastructure and trust & safety | 324 | 22 | 242 | 23 | |||||||||||||||||||||||||||||||||||
Research and development | 422 | 29 | 374 | 36 | |||||||||||||||||||||||||||||||||||
General and administrative | 209 | 14 | 119 | 12 | |||||||||||||||||||||||||||||||||||
Sales and marketing | 64 | 4 | 48 | 5 | |||||||||||||||||||||||||||||||||||
Total costs and expenses | 1,736 | 120 | 1,290 | 125 | |||||||||||||||||||||||||||||||||||
| Loss from operations | (294) | (20) | (255) | (25) | |||||||||||||||||||||||||||||||||||
| Interest income | 55 | 4 | 46 | 4 | |||||||||||||||||||||||||||||||||||
| Interest expense | (10) | (1) | (10) | (1) | |||||||||||||||||||||||||||||||||||
| Other income/(expense), net | 2 | — | 4 | — | |||||||||||||||||||||||||||||||||||
| Loss before income taxes | (247) | (17) | (215) | (21) | |||||||||||||||||||||||||||||||||||
| Provision for/(benefit from) income taxes | 1 | — | 1 | — | |||||||||||||||||||||||||||||||||||
| Consolidated net loss | (248) | (17) | (216) | (21) | |||||||||||||||||||||||||||||||||||
Net loss attributable to noncontrolling interest(2) | (2) | — | (1) | — | |||||||||||||||||||||||||||||||||||
| Net loss attributable to common stockholders | $ | (246) | (17) | % | $ | (215) | (21) | % | |||||||||||||||||||||||||||||||
| Net loss per share attributable to common stockholders, basic and diluted | $ | (0.35) | $ | (0.32) | |||||||||||||||||||||||||||||||||||
| Weighted-average shares used in computing net loss per share attributable to common stockholders—basic and diluted | 711,697 | 671,657 | |||||||||||||||||||||||||||||||||||||
(1)Depreciation of servers and infrastructure equipment included in infrastructure and trust & safety.
(2)Our condensed consolidated financial statements include our majority-owned subsidiary Roblox China Holding Corp. The ownership interest of a minority investor, Songhua River Investment Limited, is recorded as a noncontrolling interest.
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Comparison of the Three Months Ended March 31, 2026 and 2025
Revenue
Three Months Ended March 31, | Year-Over-Year | |||||||||||||||||||||||||||
| 2026 | 2025 | % Change | ||||||||||||||||||||||||||
(dollars in millions) | ||||||||||||||||||||||||||||
| Revenue | $ | 1,442 | $ | 1,035 | 39 | % | ||||||||||||||||||||||
Revenue increased $407 million, or 39%, for the three months ended March 31, 2026 compared to the three months ended March 31, 2025. The increase is primarily due to a higher amortization of prior period deferred revenue and an increase in revenue recognized from current period bookings. The increase in revenue recognized from current period bookings was driven by an increase in bookings, coupled with an increase in consumable virtual item-related revenue, which accounted for 12% of virtual-item related revenue during the three months ended March 31, 2026 as compared to 9% in the three months ended March 31, 2025.
The increase in bookings during the three months ended March 31, 2026 compared to the three months ended March 31, 2025 was primarily driven by a higher average number of daily unique paying users during the current period, which increased to approximately 1.9 million during the three months ended March 31, 2026 from approximately 1.2 million during the three months ended March 31, 2025. The average number of daily unique paying users represents the number of user accounts that made a payment on the Platform, including redemption of prepaid cards for Robux, on an average daily basis during the respective period.
Cost of revenue
Three Months Ended March 31, | Year-Over-Year | |||||||||||||||||||||||||||
| 2026 | 2025 | % Change | ||||||||||||||||||||||||||
(dollars in millions) | ||||||||||||||||||||||||||||
| Cost of revenue | $ | 294 | $ | 225 | 31 | % | ||||||||||||||||||||||
Cost of revenue increased $69 million, or 31%, for the three months ended March 31, 2026 compared to the three months ended March 31, 2025. The increase is primarily due to an increase of $71 million in expense associated with payment processing fees, largely from higher amortization of prior period deferred payment processing fees and an increase in expense associated with current period payment processing fees driven by the related growth in bookings. The increase in cost of revenue recognized from current period payment processing fees was also driven by the aforementioned increase in consumable virtual item-related revenue, as the payment processing fees are expensed over the same period as the respective revenue.
Developer exchange fees
Three Months Ended March 31, | Year-Over-Year | |||||||||||||||||||||||||||
| 2026 | 2025 | % Change | ||||||||||||||||||||||||||
(dollars in millions) | ||||||||||||||||||||||||||||
| Developer exchange fees | $ | 423 | $ | 282 | 50 | % | ||||||||||||||||||||||
Developer exchange fees increased $141 million, or 50%, for the three months ended March 31, 2026 compared to the three months ended March 31, 2025. The increase is primarily driven by an increase in amounts earned by creators due to the growth in bookings over the same period. The growth in developer exchange fees exceeded the growth in bookings, primarily driven by (i) an 8.5% increase in the amount creators in our Developer Exchange Program can receive in fiat currency based on earned Robux accumulated, prospectively from September 5, 2025 onwards, (ii) the launch of Creator Rewards in July 2025, which generated higher expense than our legacy EBP program in the prior period, and (iii) differential Robux pricing which offers more Robux for users purchasing Robux through payment processing channels with lower transaction processing fees, which in turn increases the supply of Robux available for creators to accumulate.
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Infrastructure and trust & safety
Three Months Ended March 31, | Year-Over-Year | |||||||||||||||||||||||||||
| 2026 | 2025 | % Change | ||||||||||||||||||||||||||
(dollars in millions) | ||||||||||||||||||||||||||||
| Infrastructure and trust & safety | $ | 324 | $ | 242 | 34 | % | ||||||||||||||||||||||
Infrastructure and trust & safety expenses increased $82 million, or 34%, for the three months ended March 31, 2026 compared to the three months ended March 31, 2025. The increase is primarily driven by an increase of $66 million related to data center and technical infrastructure expenses (including depreciation and amortization) and hosting costs associated with providing the Platform to our users. The increase was supplemented by an increase of $9 million in personnel costs, primarily due to an increase in headcount to support our infrastructure growth.
Research and development
Three Months Ended March 31, | Year-Over-Year | |||||||||||||||||||||||||||
| 2026 | 2025 | % Change | ||||||||||||||||||||||||||
(dollars in millions) | ||||||||||||||||||||||||||||
| Research and development | $ | 422 | $ | 374 | 13 | % | ||||||||||||||||||||||
Research and development expenses increased $48 million, or 13%, for the three months ended March 31, 2026 compared to the three months ended March 31, 2025. The increase is primarily due to an increase of $48 million in personnel costs, which includes an increase of $15 million in stock-based compensation expense, primarily due to growth in headcount supporting our engineering, design, and product teams.
General and administrative
Three Months Ended March 31, | Year-Over-Year | |||||||||||||||||||||||||||
| 2026 | 2025 | % Change | ||||||||||||||||||||||||||
(dollars in millions) | ||||||||||||||||||||||||||||
| General and administrative | $ | 209 | $ | 119 | 76 | % | ||||||||||||||||||||||
General and administrative expenses increased $90 million, or 76%, for the three months ended March 31, 2026 compared to the three months ended March 31, 2025. The increase is primarily due to $57 million in legal settlement accruals related to settlements and settlement negotiations with various states regarding youth-related consumer protection and digital safety matters. The increase also includes an increase of $16 million in professional services, primarily from legal fees associated with ongoing litigation and investigations, and an increase of $10 million in personnel costs, primarily due to growth in headcount.
Sales and marketing
Three Months Ended March 31, | Year-Over-Year | |||||||||||||||||||||||||||
| 2026 | 2025 | % Change | ||||||||||||||||||||||||||
(dollars in millions) | ||||||||||||||||||||||||||||
| Sales and marketing | $ | 64 | $ | 48 | 33 | % | ||||||||||||||||||||||
Sales and marketing expenses increased $16 million, or 33%, for the three months ended March 31, 2026 compared to the three months ended March 31, 2025. The increase is primarily due to an increase of $13 million in advertising and promotional expenses and an increase of $1 million in personnel costs, primarily due to growth in headcount.
38
Interest income, interest expense, other income/(expense), net, and provision for/(benefit from) income taxes
Three Months Ended March 31, | Year-Over-Year | |||||||||||||||||||||||||||
| 2026 | 2025 | % Change | ||||||||||||||||||||||||||
(dollars in millions) | ||||||||||||||||||||||||||||
| Interest income | $ | 55 | $ | 46 | 20 | % | ||||||||||||||||||||||
| Interest expense | ||||||||||||||||||||||||||||
Next expected filings
- ~2026-07-30 10-Q expected by 2026-08-03 (in 90 days)
- ~2026-10-29 10-Q expected by 2026-11-02 (in 181 days)
- ~2027-02-06 10-K expected by 2027-02-14 (in 281 days)
- ~2027-04-29 10-Q expected by 2027-05-03 (in 363 days)
Predicted from historical filing cadence; not an SEC commitment.
Recent SEC filings
- 2026-04-30 10-Q Quarterly Report
- 2026-04-30 8-K Earnings Release; Regulation FD Disclosure; Financial Statements and Exhibits
- 2026-04-16 DEF 14A Proxy Statement
- 2026-03-20 8-K Officer/Director Change; Financial Statements and Exhibits
- 2026-03-02 8-K Officer/Director Change
- 2026-02-11 10-K Annual Report
- 2026-02-05 8-K Earnings Release; Regulation FD Disclosure; Financial Statements and Exhibits
- 2025-10-30 10-Q Quarterly Report
- 2025-10-30 8-K Earnings Release; Regulation FD Disclosure; Financial Statements and Exhibits
- 2025-09-17 8-K Officer/Director Change
- 2025-07-31 10-Q Quarterly Report
- 2025-07-31 8-K Earnings Release; Officer/Director Change; Regulation FD Disclosure; Other Events; Financial Statements and Exhibits
- 2025-07-01 8-K Officer/Director Change
- 2025-06-10 8-K Officer/Director Change; Financial Statements and Exhibits
- 2025-06-02 8-K Material Modification to Rights; Shareholder Vote Results; Other Events; Financial Statements and Exhibits