Roblox FY2025 Q4 Earnings Release
Download PDFQ4 2025
Supplemental Materials
February 5, 2026
2
Forward-Looking Statements
This presentation and the live webcast and Q&A session which will be held at 130 p.m. Pacific Time/430 p.m. Eastern Time on Thursday, February 5, 2026 contain “forward-looking statementsˮ within the
meaning of the “safe harborˮ provisions of the Private Securities Litigation Reform Act of 1995, including but not limited to, statements regarding our vision to connect one billion users with optimism and
civility, our vision to reach 10% of the global gaming content market, the amount of expected earnings for the creator community, our efforts to improve the Roblox Platform, including Novel game
expansion and technological innovations such as SLIM, server authority, and texture streaming, our trust and safety efforts, including our efforts to expand and report on age-checking of users who access
voice or text-based chat on platform, our investments in AI-powered initiatives, including those related to creation, safety, discovery, and social interaction, our infrastructure and capital expenditure plans,
including our deployment of GPUs in our data centers, our efforts toward scaled advertising on the platform, including our existing partnerships and expansion of content integrations with new partners,
our
improvements to our creator economics, including our expansion of regional pricing, pricing optimization tools, and other investments in our creator community, our recent and anticipated product
launches, our business, product, strategy, and user growth, our investment strategy, including with respect to people and opportunities for and expectations of improvements in financial and operating
metrics, including operating leverage, margin, free cash flow, operating expenses, and capital expenditures and cost to serve, our expectation of successfully executing such strategies and plans,
disclosures regarding the seasonality of our business and future growth rates, including with respect to our user demographics, changes to our estimated average lifetime of a paying user and the resulting
effect on revenue, cost of revenue, deferred revenue, and deferred cost of revenue, our expectations of future net losses and net cash and cash equivalents provided by operating activities, payments to
our creators, statements by our Chief Executive Officer and Chief Financial Officer, our outlook and guidance for the first quarter and full year 2026, and our expectations regarding no longer providing
annual guidance starting in 2027. These forward-looking statements are made as of the date they were first issued and were based on current plans, expectations, estimates, forecasts, and projections as
well as the beliefs and assumptions of management. Words such as “expect,ˮ “vision,ˮ “envision,ˮ “evolving,ˮ “drive,ˮ “anticipate,ˮ “intend,ˮ “maintain,ˮ “should,ˮ “believe,ˮ “continue,ˮ “plan,ˮ “goal,ˮ
“opportunity,ˮ “estimate,ˮ “predict,ˮ “may,ˮ “will,ˮ “could,ˮ “hope,ˮ “target,ˮ “project,ˮ “potential,ˮ “might,ˮ “shall,ˮ “contemplate,ˮ and “would,ˮ and variations of these terms or the negative of these terms
and
similar expressions are intended to identify these forward-looking statements. Forward-looking statements are subject to a number of risks and uncertainties, many of which involve factors or
circumstances that are beyond our control. Our actual results could differ materially from those stated or implied in forward-looking statements due to a number of factors, including but not limited to risks
detailed in our filings with the Securities and Exchange Commission (the “SECˮ), including our annual reports on Form 10K, our quarterly reports on Form 10Q, and other filings and reports we make with
the SEC from time to time. In particular, the following factors, among others, could cause results to differ materially from those expressed or implied by such forward-looking statements: our ability to
successfully execute our business and growth strategy; the sufficiency of our cash and cash equivalents and investments to meet our liquidity needs, including the repayment of our senior notes; the
demand for our platform in general; our ability to sustain virality of experiences on our platform; the seasonality of our business and the impact of viral experiences; our ability to retain and increase our
number of users and creators, while adequately scaling our infrastructure as engagement increases; changes in the average lifetime of a paying user; the impact of inflation, tariffs, and global economic
conditions on our operations; the impact of changing legal and regulatory requirements on our business, including the use of verified parental consent; our ability to develop enhancements to our platform,
and bring them to market in a timely manner; our ability to develop and protect our brand; any misuse of user data or other undesirable activity by third parties on our platform; our ability to maintain the
security and availability of our platform; the impact of our trust and safety efforts on our ability to attract and retain users and creators; our ability to detect and minimize unauthorized use of our platform;
and the impact of AI on our platform, users, and creators. Additional information regarding these and other risks and uncertainties that could cause actual results to differ materially from our expectations is
included in the reports we have filed or will file with the SEC, including our annual reports on Form 10K and our quarterly reports on Form 10Q.
The forward-looking statements included in this presentation represent our views as of the date of this presentation. We anticipate that subsequent events and developments will cause our views to
change. However, we undertake no intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise. These forward-looking
statements should not be relied upon as representing our views as of any date subsequent to the date of this presentation.
3
Q4 2025 Results Review
REVENUE
BOOKINGS
1
AVERAGE DAILY
ACTIVE USERS
(“DAUsˮ)
HOURS
ENGAGED
$1.4B
$2.2B
35B
144M
43% YoY Growth
63% YoY Growth
69% YoY Growth
88% YoY Growth
For endnote descriptions, see
final slide
.
CONSOLIDATED
NET LOSS
$318M
Q4 2025 Results Review
$607M
NET CASH AND CASH
EQUIVALENTS PROVIDED BY
OPERATING ACTIVITIES
$307M
FREE CASH FLOW
1
229% YoY Growth
ADJUSTED
EBITDA
A1
$3M
4
155% YoY
Growth
A
Adjusted EBITDA excludes adjustments for an increase in deferred revenue of $818 million and an increase in deferred cost of revenue of $122) million, or a total change in net deferrals of $696 million.
For endnote descriptions, see
final slide
.
Operating and Financial
Metrics
5
DAUs
(in millions)
Year-over-year growth %
6
DAUs by Region
(2)(A)
(in millions)
YoY
7
17%
13%
21%
26%
15%
22%
21%
32%
32%
20%
13%
14%
15%
6%
10%
24%
56%
62%
27%
26%
31%
37%
30%
40%
76%
108%
95%
22%
19%
22%
30%
27%
33%
39%
80%
80%
22%
17%
21%
27%
19%
26%
41%
70%
69%
US & Canada
Europe
APAC
ROW
US & Canada
Europe
APAC
ROW
Total
A
We are currently transitioning from self-reported age data to age-checked metrics. Therefore, we will not be reporting age demographic data for the fourth quarter of 2025.
For endnote descriptions, see
final slide
.
Hours Engaged
(in billions)
Year-over-year growth %
8
Hours Engaged by Region
(2)(A)
(in billions)
YoY
9
16%
12%
23%
28%
17%
27%
35%
47%
41%
21%
11%
16%
17%
9%
16%
43%
82%
76%
27%
23%
39%
45%
33%
44%
95%
127%
128%
21%
15%
22%
29%
26%
36%
56%
109%
100%
21%
15%
24%
29%
21%
30%
58%
91%
88%
US & Canada
Europe
APAC
ROW
US & Canada
Europe
APAC
ROW
Total
A
We are currently transitioning from self-reported age data to age-checked metrics. Therefore, we will not be reporting age demographic data for the fourth quarter of 2025.
For endnote descriptions, see
final slide
.
Revenue
(3)
$ in millions, unaudited)
10
For endnote descriptions, see
final slide
.
Year-over-year growth %
Revenue by Region
(3)(4)
$ in millions, unaudited)
YoY
11
27%
20%
29%
27%
30%
27%
18%
40%
34%
29%
23%
32%
31%
35%
33%
25%
58%
54%
39%
31%
38%
29%
31%
28%
22%
60%
59%
39%
33%
42%
38%
42%
40%
31%
73%
69%
30%
22%
31%
29%
32%
29%
21%
48%
43%
US & Canada
Europe
APAC
ROW
For endnote descriptions, see
final slide
.
US & Canada
Europe
APAC
ROW
Total
Bookings
(1)
$ in millions, unaudited)
12
For endnote descriptions, see
final slide
.
Year-over-year growth %
Bookings by Region
(1)(4)
$ in millions, unaudited)
13
YoY
US & Canada
Europe
APAC
ROW
For endnote descriptions, see
final slide
.
US & Canada
Europe
APAC
ROW
Total
21%
17%
21%
33%
18%
31%
43%
50%
41%
37%
23%
24%
36%
24%
29%
60%
90%
95%
18%
16%
22%
36%
29%
32%
75%
110%
96%
49%
35%
33%
37%
24%
32%
55%
129%
123%
25%
19%
22%
34%
21%
31%
51%
70%
63%
14
Average Bookings per DAU (“ABPDAU”)
(1)
For endnote descriptions, see
final slide
.
Year-over-year growth %
ABPDAUs by Region
(1)(2)(4)
APAC
Europe
US & Canada
ROW
15
For endnote descriptions, see
final slide
.
Year-over-year growth %
Payer Community
Average Monthly Unique Payers (in millions)
Average Bookings Per Monthly Unique Payer
1
16
For endnote descriptions, see
final slide
.
17
Four Main
Expenses
Cost of Revenue
(3)
$ in millions, unaudited)
18
For endnote descriptions, see
final slide
.
Year-over-year growth %
Developer Exchange Fees
$ in millions, unaudited)
% of Revenue
% of Bookings
1
29.6%
25.3%
23.3%
25.2%
28.4%
27.2%
29.3%
31.5%
33.7%
19.7%
21.9%
21.8%
20.5%
20.6%
23.3%
22.0%
22.3%
21.5%
19
For endnote descriptions, see
final slide
.
Year-over-year growth %
Certain Infrastructure and Trust & Safety Expense
(5)
$ in millions, unaudited)
% of Revenue
% of Bookings
1
16.6%
15.5%
13.6%
14.1%
12.8%
13.0%
14.1%
15.3%
14.8%
11.0%
13.5%
12.8%
11.5%
9.3%
11.1%
10.6%
10.8%
9.4%
20
For endnote descriptions, see
final slide
.
Year-over-year growth %
% of Revenue
% of Bookings
1
2500
2500
2400
2400
2500
2600
2800
3000
3100
26.5%
28.2%
22.9%
22.0%
20.3%
23.0%
22.6%
18.4%
17.7%
17.6%
24.5%
21.4%
17.9%
14.7%
19.8%
17.0%
13.0%
11.2%
Headcount
21
Personnel Costs excl. Stock-Based Compensation Expense
$ in millions, unaudited)
For endnote descriptions, see
final slide
.
Year-over-year growth %
Balance Sheet,
Cash Flow, &
Shares Outstanding
22
Balance Sheet Update
$ in millions, unaudited)
$2,232
$2,464
$2,596
$2,876
$3,013
$3,504
$3,731
$4,214
$4,540
Net cash and
investments
6
Total cash, cash
equivalents, and
investments
$3,237
$3,469
$3,601
$3,882
$4,020
$4,511
$4,738
$5,221
$5,548
23
7
For endnote descriptions, see
final slide
.
Net Cash and Cash Equivalents Provided by Operating Activities
$ in millions, unaudited)
24
A
Operating cash flow in 1Q25 benefited from the delay of a $30 million payout to a creator that was subsequently paid and negatively impacted operating cash flow in 2Q25. Had we made this payment in
1Q25 as originally intended, 1Q25 operating cash flow would have been $414 million and 2Q25 operating cash flow would have been $229 million.
A
A
Free Cash Flow
(1)
$ in millions, unaudited)
Acquisition of property
and equipment
Purchases of intangible
assets
$65
$47
$40
$29
$64
$17
$23
$103
$298
—
$1
—
—
—
—
—
$1
$2
25
A
A
Free cash flow in 1Q25 benefited from the delay of a $30 million payout to a creator that was subsequently paid and negatively impacted free cash flow in 2Q25. Had we made this payment in 1Q25 as
originally
intended, 1Q25 free cash flow would have been $397 million and 2Q25 free cash flow would have been $207 million.
For endnote descriptions, see
final slide
.
A
For further information on these award types, please refer to our annual and quarterly SEC filings.
A
The weighted average exercise price per outstanding option was $3.64, $3.08, and $2.98 as of 4Q25, 4Q24, and 4Q23, respectively.
B
Other awards include the actual or hypothetical number of unvested shares earned under the Companyʼs PSU awards, based on actual performance as of the respective balance sheet date.
Shares Outstanding
(shares in millions, unaudited)
As of
12/31/2025
12/31/2024
12/31/2023
2024 to
2025 YoY%
Shares of Class A and B Common stock
outstanding
708
666
631
6%
Number of stock options outstanding
A
9
27
40
67%
Number of unvested RSUs outstanding
25
35
40
30%
Number of ESPP shares to be
purchased
1
2
3
15%
Number of other awards
B
and
warrants outstanding or unreleased
2
1
–
201%
Total outstanding and potentially dilutive
shares
746
731
715
2%
26
Guidance
27
28
1Q26 Guidance
(8)
Summary
$ in millions)
3 months ended
Guidance
Actual
Q1 2026
Q1 2025
YoY %
Low
High
Low
High
Revenue
$1,370
$1,420
$1,035
32%
37%
Bookings
1
$1,690
$1,740
$1,207
40%
44%
Consolidated net loss
$329
$311
$216
52%
44%
Adjusted EBITDA
1
$4
$22
$58
93%
62%
Total net increase in deferred revenue and deferred cost of revenue
$298
$298
$147
103%
103%
Net cash and cash equivalents provided by operating activities
$590
$614
$444
33%
38%
Capital expenditures and purchases of intangible assets
$30
$30
$17
73%
73%
Free cash flow
1
$560
$584
$427
31%
37%
For endnote descriptions, see
final slide
.
12 months ended
Guidance
Actual
Full Year 2026
Full Year 2025
YoY %
Low
High
Low
High
Revenue
$6,019
$6,290
$4,891
23%
29%
Bookings
1
$8,282
$8,553
$6,788
22%
26%
Consolidated net loss
$1,303
$1,135
$1,072
22%
6%
Adjusted EBITDA
1
$30
$198
$125
76%
59%
Total net increase in deferred revenue and deferred cost of revenue
$1,970
$1,970
$1,603
23%
23%
Net cash and cash equivalents provided by operating activities
$2,118
$2,286
$1,796
18%
27%
Capital expenditures and purchases of intangible assets
$520
$470
$443
17%
6%
Free cash flow
1
$1,598
$1,816
$1,353
18%
34%
29
Fiscal Year 2026 Guidance
(8)
Summary
$ in millions)
For endnote descriptions, see
final slide
.
1Q26 Guidance: Non-GAAP Financial Measures Reconciliation
Revenue
8
to Bookings
1
$ in millions)
3 months ended
Guidance
Actual
Q1 2026
Q1 2025
YoY %
Low
High
Low
High
Revenue
$1,370
$1,420
$1,035
32%
37%
Add (deduct):
Change in deferred revenue
328
328
178
84%
84%
Other
8
8
6
25%
25%
Bookings
$1,690
$1,740
$1,207
40%
44%
30
For endnote descriptions, see
final slide
.
Fiscal Year 2026 Guidance:
Non-GAAP Financial Measures Reconciliation
Revenue
8
to Bookings
1
$ in millions)
12 months ended
Guidance
Actual
Full Year 2026
Full Year 2025
YoY %
Low
High
Low
High
Revenue
$6,019
$6,290
$4,891
23%
29%
Add (deduct):
Change in deferred revenue
2,295
2,295
1,934
19%
19%
Other
32
32
36
11%
11%
Bookings
$8,282
$8,553
$6,788
22%
26%
31
For endnote descriptions, see
final slide
.
1Q26 Guidance: Non-GAAP Financial Measures Reconciliation
Consolidated Net Loss
8
to Adjusted EBITDA
18
$ in millions)
3 months ended
Guidance
Actual
Q1 2026
Q1 2025
YoY %
Low
High
Low
High
Consolidated Net Loss
$329
$311
$216
52%
44%
Add (deduct):
Interest income
50
50
46
8%
8%
Interest expense
11
11
10
6%
6%
Other (income)/expense, net
—
—
3
NM
NM
Provision for/(benefit from) income taxes
2
2
1
132%
132%
Depreciation and amortization expense
80
80
54
49%
49%
Stock-based compensation expense
290
290
259
12%
12%
Adjusted EBITDA
$4
$22
$58
93%
62%
32
For endnote descriptions, see
final slide
.
Fiscal Year 2026 Guidance:
Non-GAAP Financial Measures Reconciliation
Consolidated Net Loss
8
to Adjusted EBITDA
18
$ in millions)
12 months ended
Guidance
Actual
Full Year 2026
Full Year 2025
YoY %
Low
High
Low
High
Consolidated Net Loss
$1,303
$1,135
$1,072
22%
6%
Add (deduct):
Interest income
205
205
202
2%
2%
Interest expense
42
42
41
1%
1%
Other (income)/expense, net
—
—
4
NM
NM
Provision for/(benefit from) income
taxes
6
6
4
67%
67%
Depreciation and amortization expense
320
320
226
42%
42%
Stock-based compensation expense
1,170
1,170
1,129
4%
4%
Other charges
—
—
2
NM
NM
Adjusted EBITDA
$30
$198
$125
76%
59%
33
For endnote descriptions, see
final slide
.
3 months ended
Guidance
Actual
Q1 2026
Q1 2025
YoY %
Low
High
Low
High
Net cash and cash equivalents provided by
operating activities
$590
$614
$444
33%
38%
Deduct:
Acquisition of property and equipment
30
30
17
73%
73%
Free cash flow
$560
$584
$427
31%
37%
34
1Q26 Guidance: Non-GAAP Financial Measures Reconciliation
Net Cash and Cash Equivalents Provided by Operating Activities to Free Cash Flow
1
$ in millions)
For endnote descriptions, see
final slide
.
12 months ended
Guidance
Actual
Full Year 2026
Full Year
2025
YoY %
Low
High
Low
High
Net cash and cash equivalents provided by
operating activities
$2,118
$2,286
$1,796
18%
27%
Deduct:
Acquisition of property and equipment
520
470
441
18%
7%
Purchases of intangible assets
—
—
3
NM
NM
Free cash flow
$1,598
$1,816
$1,353
18%
34%
35
Fiscal Year 2026 Guidance:
Non-GAAP Financial Measures Reconciliation
Net Cash and Cash Equivalents Provided by Operating Activities to Free Cash Flow
1
$ in millions)
For endnote descriptions, see
final slide
.
Appendices
36
●
Paying user spends Robux (on average, within 3 days
A
) on the platform to
purchase:
●
Paying user spends
$30
on the Roblox platform to purchase 3,000 Robux
or
purchases a
$30
prepaid card to exchange for 3,000 Robux
Bookings recognized = $30
Recognized in Month 1
Durable Virtual Items
B
=
2,700 Robux, or
$27
GAAP Revenue Recognition
Revenue is recognized over estimated average lifetime of paying user
C
$27 bookings / 27 months
C
= $1 per month
Month 1
Months 227
$1
$1 / month $26 deferred)
Revenue recognized by month
Revenue recognized = $1
(associated with durable items)
Deferred Revenue
at end of Month 1 $26
(to be recognized as revenue
in months 227
Consumable Virtual Items
B
=
300 Robux, or
$3
GAAP Revenue Recognition
Revenue is recognized immediately upon consumption
Revenue recognized = $3
(associated with consumable items)
$3 bookings in month of purchase
Recognized in Month 1
Total Revenue recognized $4 + Deferred Revenue $26 = Bookings $30
37
Revenue, Deferred Revenue, and Bookings Illustration
The following example illustrates GAAP revenue recognition for bookings on the Roblox platform.
A
For the three months ended December 31, 2025, average number of days it takes our users to spend Robux following purchase of Robux through our platform or following redemption of Robux from prepaid cards.
B
For the three months ended December 31, 2025, durable virtual items accounted for 82% of virtual item-related revenue while consumable virtual items accounted for 18%. For the purpose of the example, we did
not apply these exact percentages.
C
For the three months ended December 31, 2025, the estimated average lifetime for a paying user was 27 months.
Non-GAAP Financial Measures Reconciliation
Revenue to Bookings
1
$ in millions, unaudited)
3 months ended
12/31/2025
12/31/2024
12/31/2023
2024 to
2025 YoY%
Revenue
$ 1,415
$ 988
$ 750
43%
Add (deduct):
Change in deferred revenue
818
382
382
114%
Other
11
8
5
31%
Bookings
$ 2,222
$ 1,362
$ 1,127
63%
38
For endnote descriptions, see
final slide
.
Non-GAAP Financial Measures Reconciliation
Consolidated Net Loss to Adjusted EBITDA
1
$ in millions, unaudited)
39
3 months ended
12/31/2025
12/31/2024
12/31/2023
2024 to
2025 YoY%
Consolidated Net Loss
$ 318
$ 221
$ 325
44%
Add (deduct):
Interest income
54
46
40
17%
Interest expense
10
10
10
1%
Other (income)/expense, net
2
10
1
76%
Provision for/(benefit from) income taxes
1
3
–
64%
Depreciation and amortization expense
63
51
55
23%
Stock-based compensation expense
298
258
251
16%
Other charges
–
–
5
NM
Adjusted EBITDA
$ 3
$ 66
$ 45
96%
For endnote descriptions, see
final slide
.
Non-GAAP Financial Measures Reconciliation
Net Cash and Cash Equivalents Provided by Operating Activities to Free Cash Flow
1
$ in millions, unaudited)
3 months ended
12/31/2025
12/31/2024
12/31/2023
2024 to
2025 YoY%
Net cash and cash equivalents provided by
operating activities
$ 607
$ 184
$ 143
229%
Deduct:
Acquisition of property and equipment
298
64
65
367%
Purchases of intangible assets
2
–
–
NM
Free cash flow
$ 307
$ 121
$ 78
155%
40
For endnote descriptions, see
final slide
.
41
Non-GAAP Financial Measures Definitions
This presentation contains the following non-GAAP financial measures: 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 presentation are included in this presentation. 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.
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.
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 nonrecurring 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 ongoing
operating trends. Our definition of Adjusted EBITDA may differ from the definition used by other companies and therefore comparability may be limited.
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 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.
42
Note Regarding Operating Metrics
We manage our business by tracking several operating metrics, including average daily active users (“DAUs”), hours engaged, bookings, average bookings per DAU (“ABPDAU”), average monthly
unique payers, and average bookings per monthly unique payer. As a management team, we believe each of these operating metrics provides useful information to investors and others. For
information concerning these metrics as measured by us, see “Managementʼs Discussion and Analysis of Financial Condition and Results of Operations” in our most recently filed annual report on
Form 10-K or quarterly report on Form 10-Q.
While these metrics are based on what we believe to be reasonable estimates of our user base for the applicable period of measurement, there are inherent challenges in measuring how our platform
is used. These metrics are determined by using internal data gathered on an analytics platform that we developed and operate and have not been validated by an independent third party. This
platform tracks user account and session activity, and its accuracy and precision may be and, at times, has been impacted by implementation challenges, methodological limitations, and operational
constraints. If we fail to maintain an effective analytics platform, our metrics calculations may be inaccurate. These metrics are also determined by certain demographic data historically provided to us
by the user, such as age or gender and increasingly using age-check data, as further described below. If our users provide us with incorrect or incomplete information or if our age-check systems
misrepresent user ages, then our estimates may be inaccurate. Our estimates also may change as our methodologies and platform evolve, including through the application of new data sets or
technologies or as our platform changes with new features and enhancements.
We believe that these metrics are reasonable estimates of our user base for the applicable period of measurement, and that the methodologies we employ and update from time to time to create
these metrics are reasonable bases to identify trends in user behavior. Because we update the methodologies we employ to create metrics, our current and future period metrics may not be
comparable to those in prior periods. For example, historically our reported age demographics were based on age information self-reported by our users. We are currently developing, testing, and
implementing new systems designed to check the ages of our users, which we refer to as “age-checking,” and currently we incorporate facial age estimation technology, identity verification, and
parent or caregiver provided age data. As a result of this transition, we are not reporting age demographic data for the fourth quarter of 2025. Age-checked metrics will not be comparable to
historical
periods that relied on self-reported data.
Finally, the accuracy of our metrics may be affected by certain factors relating to user activity and our platformʼs systems and our ability to identify and detect attempts to replicate legitimate user
activity, often referred to as botting. See the section in our most recently filed annual report on Form 10-K or quarterly report on Form 10-Q titled “Risk Factors—Our user metrics and other estimates
are subject to inherent challenges in measurement, and real or perceived inaccuracies in those metrics may significantly harm and negatively affect our reputation and our business.”
43
Note Regarding Operating Metrics (continued)
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 believe this method better reflects global engagement on the platform compared to a method based purely on a calendar-day cutoff. DAUs for a
specified
period is the average of the DAUs for each day during that period. As an example, DAUs for the month of September would be an average of DAUs during that 30 day period.
Other companies, including companies in our industry, may calculate DAUs differently. We track DAUs as an indicator of the size of the audience engaged on our platform. DAUs are also broken out by geographic region to help us understand
the
global engagement on our platform. The geographic location data collected is based on the IP address associated with the account when an account is initially registered on Roblox. The IP address may not always accurately reflect a userʼs
actual location at the time they engaged with our platform. Prior to the fourth quarter of 2023, we grouped Xbox users into Rest of World for the purposes of our reporting and beginning in the fourth quarter of 2023, Xbox users have been
reported in their respective geographies (we note that prior to the fourth quarter of 2023, Xbox users represented less than 2% of our total quarterly DAUs and quarterly hours engaged).
Because DAUs measure account activity and an individual user may actively use our platform within a particular day on multiple accounts for which that individual registered, our DAUs are not a measure of unique individuals accessing Roblox.
References to “user” or our “user base” in this presentation refer to users as described in our definition of DAUs. Additionally, if undetected, fraud and unauthorized access to our platform may contribute, from time to time, to an overstatement of
DAUs. In many cases, fraudulent accounts are created by bots to inflate user activity for a particular creatorʼs content on our platform, thus making the creatorʼs experience (which refer to the titles that have been created by creators) or other
content appear more popular than it really is. We strive to detect and minimize fraud and unauthorized access to our platform. See the sections in our most recently filed annual report on Form 10-K or quarterly report on Form 10-Q titled “Risk
Factors—Our user metrics and other estimates are subject to inherent challenges in measurement, and real or perceived inaccuracies in those metrics may significantly harm and negatively affect our reputation and our business,” and “Risk
Factors—Some creators and users on our Platform may make unauthorized, fraudulent, or illegal use of Robux and other digital goods or experiences on our Platform, including by use of unauthorized third-party websites or “cheating”
programs.”
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 experiences, 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. User sessions on our platform may be tracked differently across
devices and platforms, including mobile, tablet, web, desktop, and game console due to inherent differences in functionality and user behaviors. As we continue to develop new features and products, we expect that our user session calculation
will continue to evolve. We continue to review our user session calculation methodologies and may develop alternative calculation methods to increase consistency and accuracy in future periods.
We track hours engaged as an indicator of the user engagement on our platform. Hours engaged are also broken out by geographic region, based on the IP address associated with the account when an account was initially registered on
Roblox,
to help us understand the global engagement on our platform. The IP address may not always accurately reflect a userʼs actual location at the time they engaged with our platform.
We continuously strive to increase the sophistication of our company systems to detect different user activities, including botting, non-active time, and other activities across all devices. As we continue to improve our ability to detect and deter
certain user behaviors on the platform and different devices, including unauthorized use of our platform, we may see an impact to our overall hours engaged as our measurement systems evolve and our efforts to reduce botting become more
successful. See the section of our most recently filed annual report on Form 10-K or quarterly report on Form 10-Q titled “Risk Factors—Our user metrics and other estimates are subject to inherent challenges in measurement, and real or
perceived inaccuracies in those metrics may significantly harm and negatively affect our reputation and our business.”
44
Note Regarding Operating Metrics (continued)
ABPDAU
We define ABPDAU as bookings in a given period divided by the DAUs for such period. We primarily use ABPDAU as a way to understand how we are monetizing across all of our users. ABPDAU is
also broken out by geographic region to help us understand the global monetization on our platform.
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. A user account that makes multiple purchases during a
given month is counted as a single monthly unique payer. Average monthly unique payers for a specified period is the average of the monthly unique payers for each month during that period.
Because an individual user may pay on our platform within a particular month on multiple user accounts for which that individual registered, our monthly unique payers are not a measure of unique
individual payers on Roblox.
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.
45
Endnotes
Note: Amounts reported in millions are rounded based on the amounts in thousands. As a result,
the sum of the components reported in millions may not equal the total amount reported in millions
due to rounding. In addition, percentages presented are calculated from the underlying numbers in
thousands and may not add to their respective totals due to rounding.
1
Bookings, Adjusted EBITDA, and free cash flow are non-GAAP financial measures that
we believe are useful in evaluating our performance and are presented for
supplemental
information purposes only and should not be considered in isolation from, or as a
substitute for, financial information presented in accordance with GAAP. For further
information, please refer to definition and reconciliation slides within the presentation
and our annual and quarterly SEC filings.
2
Prior to the fourth quarter of 2023, we grouped Xbox users into RoW for the purposes
of
our reporting and beginning in the fourth quarter of 2023, Xbox users have been
reported in their respective geographies (we note that prior to the fourth quarter of
2023, Xbox users represented less than 2% of our total quarterly DAUs and quarterly
hours engaged). Under the previous reporting methodology, DAUs, Hours Engaged, and
ABPDAUs YoY growth would have been as follows:
4Q23
1Q24
2Q24
3Q24
DAUs
US & Canada
14%
10%
17%
22%
Europe
19%
12%
12%
13%
APAC
26%
26%
30%
37%
ROW
26%
22%
26%
34%
Hours Engaged
US & Canada
13%
9%
19%
24%
Europe
19%
10%
14%
15%
APAC
26%
23%
39%
45%
ROW
27%
20%
27%
35%
4Q23
1Q24
2Q24
3Q24
ABPDAUs
US & Canada
6%
6%
3%
9%
Europe
15%
10%
10%
20%
APAC
7%
8%
6%
0%
ROW
17%
10%
6%
3%
3
Beginning 2Q24, the estimated average lifetime of a payer changed from 28 months to
27 months.
4
Revenue and bookings are broken out by geographic region based on the billing
country
of our payers at the time of purchase, to help us understand the global engagement on
our platform. The billing address may not always accurately reflect a payerʼs actual
location at the time of purchase.
5
Infrastructure and Trust & Safety expenses, excluding personnel, stock-based
compensation, and depreciation and amortization expenses.
6
Net cash and investments represents cash, cash equivalents, and short-term and
long-term investments, less short and long-term debt, net.
7
Amounts shown for short and long-term debt, net represent the net carrying amount of
the senior notes due 2030 and beginning with 2Q23, also include the non-eliminated
carrying amount of notes issued by the Companyʼs fully consolidated joint venture; the
principal amount of the senior notes due 2030 is $1.0 billion and the principal amount of
the non-eliminated portion of the notes associated with the fully consolidated joint
venture is $14.7 million.
8
Our revenue guidance assumes that there are no material changes in estimates used in
our revenue recognition, such as the estimated consumable/durable allocation of virtual
goods purchased on the Platform and the estimated average lifetime of a paying user.
