Roblox FY2025 Q3 Earnings Release
Download PDFQ3 2025
Supplemental Materials
October 30, 2025
2
Forward-Looking Statements
This presentation and the live webcast and Q&A session which will be held at 530 a.m. Pacific Time/830 a.m. Eastern Time on Thursday, October 30, 2025 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 developer and creator community, our efforts to improve the Roblox Platform, our trust and
safety efforts, including our efforts to expand age-estimation for expand age estimation to all users who access our on-platform communication features, our investments in AI-powered initiatives,
including
those related to complex safety challenges, discovery and personalization, and “4D creationˮ, 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 Google partnership and expansion of content integrations with new partners, our improvements to our creator economics, including our
expansion of regional pricing and investments in our creator community, our product efforts regarding Moments, 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 developers and creators, statements by our Chief Executive Officer and Chief Financial Officer, our
outlook and guidance for the fourth quarter and full year 2025, and future periods, and our outlook and guidance for 2026. 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 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, developers, 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; our ability to detect and minimize unauthorized use of our platform; and the
impact of AI on our platform, users, creators, and developers. 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
Q3 2025 Results Review
REVENUE
BOOKINGS
1
AVERAGE DAILY
ACTIVE USERS
(“DAUsˮ)
HOURS
ENGAGED
$1.4B
$1.9B
39.6B
151.5M
48% YoY Growth
70% YoY Growth
70% YoY Growth
91% YoY Growth
For endnote descriptions, see
final slide
.
CONSOLIDATED
NET LOSS
$(257)M
Q3 2025 Results Review
$546M
NET CASH AND CASH
EQUIVALENTS PROVIDED BY
OPERATING ACTIVITIES
$443M
FREE CASH FLOW
1
121% YoY Growth
ADJUSTED
EBITDA
A1
$46M
4
103% YoY Growth
A
Adjusted EBITDA excludes adjustments for an increase in deferred revenue of $572.9 million and an increase in deferred cost of revenue of $115.0) million, or a total change in net deferrals of $457.9 million.
For endnote descriptions, see
final slide
.
Operating and Financial
Metrics Discussion
5
DAUs
(in millions)
Year-over-year growth %
6
DAUs by Region and Age
(2)
(in millions)
By Age Group
By Region
YoY
YoY
US & Canada
Europe
APAC
ROW
Total
U13
13
Total
11%
17%
13%
21%
26%
15%
22%
21%
32%
22%
20%
13%
14%
15%
6%
10%
24%
56%
23%
27%
26%
31%
37%
30%
40%
76%
108%
22%
22%
19%
22%
30%
27%
33%
39%
80%
20%
22%
17%
21%
27%
19%
26%
41%
70%
12%
13%
12%
15%
16%
11%
13%
22%
44%
25%
28%
22%
26%
34%
26%
36%
54%
89%
20%
22%
17%
21%
27%
19%
26%
41%
70%
7
US & Canada
Europe
APAC
ROW
U13
13
Unknown
For endnote descriptions, see
final slide
.
Hours Engaged
(in billions)
Year-over-year growth %
8
Hours Engaged by Region and Age
(2)
(in billions)
By Age Group
By Region
YoY
YoY
U13
13
Total
10%
10%
8%
16%
17%
11%
17%
36%
67%
27%
28%
19%
30%
37%
28%
40%
72%
107%
20%
21%
15%
24%
29%
21%
30%
58%
91%
9
12%
16%
12%
23%
28%
17%
27%
35%
47%
24%
21%
11%
16%
17%
9%
16%
43%
82%
21%
27%
23%
39%
45%
33%
44%
95%
127%
22%
21%
15%
22%
29%
26%
36%
56%
109%
20%
21%
15%
24%
29%
21%
30%
58%
91%
US & Canada
Europe
APAC
ROW
Total
U13
13
Unknown
US & Canada
Europe
APAC
ROW
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
34%
27%
20%
29%
27%
30%
27%
18%
40%
39%
29%
23%
32%
31%
35%
33%
25%
58%
52%
39%
31%
38%
29%
31%
28%
22%
60%
49%
39%
33%
42%
38%
42%
40%
31%
73%
38%
30%
22%
31%
29%
32%
29%
21%
48%
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
14%
21%
17%
21%
33%
18%
31%
43%
50%
37%
37%
23%
24%
36%
24%
29%
60%
90%
15%
18%
16%
22%
36%
29%
32%
75%
110%
43%
49%
35%
33%
37%
24%
32%
55%
129%
20%
25%
19%
22%
34%
21%
31%
51%
70%
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
23.9%
29.6%
25.3%
23.3%
25.2%
28.4%
27.2%
29.3%
31.5%
20.3%
19.7%
21.9%
21.8%
20.5%
20.6%
23.3%
22.0%
22.3%
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
17.5%
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%
20
For endnote descriptions, see
final slide
.
Year-over-year growth %
% of Revenue
% of Bookings
1
2500
2500
2500
2400
2400
2500
2600
2800
3000
27.5%
26.5%
28.2%
22.9%
22.0%
20.3%
23.0%
22.6%
18.4%
23.3%
17.6%
24.5%
21.4%
17.9%
14.7%
19.8%
17.0%
13.0%
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)
$2,111
$2,232
$2,464
$2,596
$2,876
$3,013
$3,504
$3,731
$4,214
Net cash and
investments
6
Total cash, cash
equivalents, and
investments
$3,116
$3,237
$3,469
$3,601
$3,882
$4,020
$4,511
$4,738
$5,221
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 developer 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 $413.9 million and 2Q25 operating cash flow would have been $229.3 million.
A
A
Free Cash Flow
(1)
$ in millions, unaudited)
Acquisition of property
and equipment
Purchases of intangible
assets
$53.2M
$65.2M
$46.7M
$39.7M
$29.4M
$63.9M
$17.4M
$22.6M
$102.6M
—
—
$1.2M
$0.2M
—
—
—
—
$1.0M
25
A
A
Free cash flow in 1Q25 benefited from the delay of a $30 million payout to a developer 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 $396.5 million and 2Q25 free cash flow would have been $206.7 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 $3.62, $3.04, and $2.92 as of 3Q25, 3Q24, and 3Q23, respectively.
B
Represents 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 thousands, unaudited)
As of
9/30/2025
9/30/2024
9/30/2023
2024 to
2025 YoY%
Shares of Class A and B Common stock
outstanding
701,867
656,132
623,588
7%
Number of stock options outstanding
A
10,363
32,160
43,306
68%
Number of unvested RSUs outstanding
28,179
36,467
36,880
23%
Number of ESPP shares to be
purchased
1,043
1,665
3,406
37%
Number of unvested PSU awards
based on performance target
achievement at period-end
B
669
43
–
NM
Number of other awards and warrants
outstanding or unreleased
339
314
540
8%
Total outstanding and potentially dilutive
shares
742,460
726,781
707,720
2%
26
Guidance
27
28
4Q25 Guidance
(8)
Summary
$ in millions)
3 months ended
Guidance
Actual
12/31/2025
12/31/2024
YoY %
Low
High
Low
High
Revenue
$1,350.0
$1,400.0
$988.2
37%
42%
Bookings
1
$2,000.0
$2,050.0
$1,361.6
47%
51%
Consolidated net loss
$375.0
$345.0
$221.1
70%
56%
Adjusted EBITDA
1
$20.0
$10.0
$65.6
NM
85%
Total net increase in deferred revenue and deferred cost of revenue
$555.0
$555.0
$316.5
75%
75%
Net cash and cash equivalents provided by operating activities
$425.0
$455.0
$184.5
130%
147%
Capital expenditures and purchases of intangible assets
$325.0
$325.0
$63.9
409%
409%
Free cash flow
1
$100.0
$130.0
$120.6
17%
8%
For endnote descriptions, see
final slide
.
12 months ended
Guidance
Actual
12/31/2025
12/31/2024
YoY %
Low
High
Low
High
Revenue
$4,825.5
$4,875.5
$3,602.0
34%
35%
Bookings
1
$6,566.2
$6,616.2
$4,369.1
50%
51%
Consolidated net loss
$1,128.5
$1,098.5
$940.6
20%
17%
Adjusted EBITDA
1
$102.0
$132.0
$180.2
43%
27%
Total net increase in deferred revenue and deferred cost of revenue
$1,461.5
$1,461.5
$627.5
133%
133%
Net cash and cash equivalents provided by operating activities
$1,614.4
$1,644.4
$822.3
96%
100%
Capital expenditures and purchases of intangible assets
$468.6
$468.6
$181.0
159%
159%
Free cash flow
1
$1,145.8
$1,175.8
$641.3
79%
83%
29
Fiscal Year Guidance
(8)
Summary
$ in millions)
For endnote descriptions, see
final slide
.
4Q25 Guidance: Non-GAAP Financial Measures Reconciliation
Revenue
8
to Bookings
1
$ in millions)
3 months ended
Guidance
Actual
12/31/2025
12/31/2024
YoY %
Low
High
Low
High
Revenue
$1,350.0
$1,400.0
$988.2
37%
42%
Add (deduct):
Change in deferred revenue
660.0
660.0
381.8
73%
73%
Other
10.0
10.0
8.3
20%
20%
Bookings
$2,000.0
$2,050.0
$1,361.6
47%
51%
30
For endnote descriptions, see
final slide
.
Fiscal Year Guidance:
Non-GAAP Financial Measures Reconciliation
Revenue
8
to Bookings
1
$ in millions)
12 months ended
Guidance
Actual
12/31/2025
12/31/2024
YoY %
Low
High
Low
High
Revenue
$4,825.5
$4,875.5
$3,602.0
34%
35%
Add (deduct):
Change in deferred revenue
1,775.8
1,775.8
792.4
124%
124%
Other
35.2
35.2
25.3
39%
39%
Bookings
$6,566.2
$6,616.2
$4,369.1
50%
51%
31
For endnote descriptions, see
final slide
.
4Q25 Guidance: Non-GAAP Financial Measures Reconciliation
Consolidated Net Loss
8
to Adjusted EBITDA
18
$ in millions)
3 months ended
Guidance
Actual
12/31/2025
12/31/2024
YoY %
Low
High
Low
High
Consolidated Net Loss
$375.0
$345.0
$221.1
70%
56%
Add (deduct):
Interest income
47.0
47.0
46.3
2%
2%
Interest expense
11.0
11.0
10.3
6%
6%
Other (income)/expense, net
—
—
10.2
NM
NM
Provision for/(benefit from) income taxes
1.0
1.0
2.6
62%
62%
Depreciation and amortization expense
70.0
70.0
51.3
36%
36%
Stock-based compensation expense
320.0
320.0
258.2
24%
24%
Other charges
—
—
0.2
NM
NM
Adjusted EBITDA
$20.0
$10.0
$65.6
NM
85%
32
For endnote descriptions, see
final slide
.
Fiscal Year Guidance:
Non-GAAP Financial Measures Reconciliation
Consolidated Net Loss
8
to Adjusted EBITDA
18
$ in millions)
12 months ended
Guidance
Actual
12/31/2025
12/31/2024
YoY %
Low
High
Low
High
Consolidated Net Loss
$1,128.5
$1,098.5
$940.6
20%
17%
Add (deduct):
Interest income
194.3
194.3
179.5
8%
8%
Interest expense
42.0
42.0
41.2
2%
2%
Other (income)/expense, net
6.6
6.6
11.5
NM
NM
Provision for/(benefit from) income
taxes
3.6
3.6
4.1
12%
12%
Depreciation and amortization expense
232.8
232.8
226.4
3%
3%
Stock-based compensation expense
1,150.6
1,150.6
1,015.8
13%
13%
Other charges
2.3
2.3
1.3
78%
78%
Adjusted EBITDA
$102.0
$132.0
$180.2
43%
27%
33
For endnote descriptions, see
final slide
.
3 months ended
Guidance
Actual
12/31/2025
12/31/2024
YoY %
Low
High
Low
High
Net cash and cash equivalents provided by
operating activities
$425.0
$455.0
$184.5
130%
147%
Deduct:
Acquisition of property and equipment
325.0
325.0
63.9
409%
409%
Free cash flow
$100.0
$130.0
$120.6
17%
8%
34
4Q25 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
12/31/2025
12/31/2024
YoY %
Low
High
Low
High
Net cash and cash equivalents provided by
operating activities
$1,614.4
$1,644.4
$822.3
96%
100%
Deduct:
Acquisition of property and equipment
467.6
467.6
179.6
160%
160%
Purchases of intangible assets
1.0
1.0
1.4
27%
27%
Free cash flow
$1,145.8
$1,175.8
$641.3
79%
83%
35
Fiscal Year 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 September 30, 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 September 30, 2025, durable virtual items accounted for 78% of virtual item-related revenue while consumable virtual items accounted for 22%. For the purpose of the example, we
did
not apply these exact percentages.
C
For the three months ended September 30, 2025, the estimated average lifetime for a paying user was 27 months.
Non-GAAP Financial Measures Reconciliation
Revenue to Bookings
1
$ in thousands, unaudited)
3 months ended
9/30/2025
9/30/2024
9/30/2023
2024 to
2025 YoY%
Revenue
$ 1,359,646
$ 918,953
$ 713,225
48%
Add (deduct):
Change in deferred revenue
572,853
216,325
130,957
165%
Other
10,682
6,758
4,729
58%
Bookings
$ 1,921,817
$ 1,128,520
$ 839,453
70%
38
For endnote descriptions, see
final slide
.
Non-GAAP Financial Measures Reconciliation
Consolidated Net Loss to Adjusted EBITDA
1
$ in thousands, unaudited)
39
3 months ended
9/30/2025
9/30/2024
9/30/2023
2024 to
2025 YoY%
Consolidated Net Loss
$ 257,371
$ 240,447
$ 278,808
7%
Add (deduct):
Interest income
52,089
46,718
36,442
11%
Interest expense
10,352
10,286
10,268
1%
Other (income)/expense, net
1,770
2,352
4,262
NM
Provision for/(benefit from) income taxes
803
303
682
165%
Depreciation and amortization expense
A
55,313
68,613
53,600
19%
Stock-based compensation expense
286,930
265,165
220,022
8%
Other charges
–
108
–
NM
Adjusted EBITDA
$ 45,708
$ 54,958
$ 26,416
17%
A
In the third quarter of 2024, the Company re-assessed the estimated useful life of certain software licenses, resulting in the acceleration of their remaining depreciation expense of $17.9 million within
infrastructure and trust & safety expenses.
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 thousands, unaudited)
3 months ended
9/30/2025
9/30/2024
9/30/2023
2024 to
2025 YoY%
Net cash and cash equivalents provided by
operating activities
$ 546,184
$ 247,430
$ 112,704
121%
Deduct:
Acquisition of property and equipment
102,582
29,405
53,196
249%
Purchases of intangible assets
1,000
–
–
NM
Free cash flow
$ 442,602
$ 218,025
$ 59,508
103%
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, which was 27 months as of September 30, 2025. 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. If our users provide us with incorrect or incomplete information, 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 have been based on age information self-reported by our users. However, we have implemented and
continue to develop, implement, and test systems to obtain additional user demographic data, including age verification and/or assurance technology, parental consents, and identification verification
and we expect to expand age estimation or verification through such systems for users who access voice or text-based chat on the platform in the near future. Starting in the third quarter of 2025,
our reported age demographics are based on a hierarchy of data sources, which may include some of the additional data sources noted above, and in which self-reported data will be used only if we
do not obtain additional data regarding the age of the user, such as, for example, through age verification. The data sources and the hierarchy we utilize may change from time to time. As a result of
these changes, prior period demographics may not be comparable to future ones. Similarly, our metrics may differ from estimates published by third parties or from similarly-titled metrics from other
companies due to differences in methodology.
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 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 Quarterly Report on Form 10-Q 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 developerʼs content on our platform, thus making the developerʼs
experience (which refer to the titles that have been created by developers) 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
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 developers, 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 10K or quarterly report on Form 10Q
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 actively 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.
