Roblox shares plunge 30% as it complains fans aren’t making enough viral hits

The Roblox Corporation is expecting a tough year ahead, due to changes in its algorithm and a lack of successful new games.

Roblox might be one of the most played video games (well, it’s more of an online platform and creation tool than a singular game) in the world, but it’s facing some trouble as it adjusts to heavier scrutiny. 

Over the past year, the platform – often accused of exploiting younger players – has rolled out age verification checks to prevent children from speaking with adults online. More recently, it has changed its discovery algorithm to prioritise games with higher player retention, over those with high monetisation and short-lived popularity. 

These changes have impacted Roblox’s financials, with the company now expecting revenue growth to slow down in the third quarter of the 2026 fiscal year. 

At first glance, the Roblox Corporation’s earnings report for Q2 2026 looks pretty peachy. Revenue grew 36% year-on-year to $1.5 billion (£1.1 billion), operating cash flow went up 60% to $318 million compared to the previous year, while daily active users were ‘largely in line with expectations’ at 123 million – an increase of 10% year-on-year. 

However, things are murkier when it comes to bookings (used to measure deferred revenue), which increased by 8% year-on-year and ‘landed at the low end’ of the company’s ‘guidance range’. 

In a letter to shareholders, Roblox blamed this disapponting growth on a decline in per hour monetisation among ‘younger cohorts in the US and Canada’.

It reads: ‘We believe the decline reflects a greater than expected shift of engagement from high monetising, 2025-vintage viral games, to both new and evergreen games with lower hourly monetisation.

‘This underlying mix shift was compounded by changes in our ‘Recommended For You’ algorithm, which intentionally provides more impressions for highly retentive games at the expense of near term monetisation, and in Q2 the near-term impact on younger cohorts has been larger than we anticipated.

‘Our internal testing tell us that, over time, longer retention should overcome a reduction in hourly monetisation.’

Roblox expects these issues to continue for the near future. For the current quarter, it is projecting bookings to decline by 14% to 18% year-on-year. It’s also expecting revenue to grow by 4% to 10%, which is less than its recent double-digit growth. 

Despite these adjustments, Roblox’s chief financial officer, Naveen Chopra, believes it will be worthwhile in the long term. ‘While our expectations for the remainder of the year have changed significantly, we have conviction that we’re making the right trade-offs to continue our role as an industry disruptor,’ Chopra said. 

However, these downward projections have impacted Roblox’s stocks. Following the Q2 2026 results, Roblox shares dropped nearly 30% last week (via Reuters), which is described as their worst one-day decline on record. 

This pressure on Roblox to adjust its strategy comes after various lawsuits, which have accused it of exploiting children and allowing the distribution of illegal content. Roblox has denied all the claims. 

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