Roblox

Roblox lost 71% of its market cap from its November 2024 peak. Daily Active Users still grew to 97.8 million in Q1/2026 — up 21% year-over-year — but the market stopped paying for users and started demanding GAAP profits. The bookings number was 1.27 billion dollars for the quarter (+22% YoY), free cash flow turned positive at 312 million dollars on a trailing-twelve-month basis, and net loss narrowed from 270 million to 41 million versus the same quarter last year.

The story underneath the chart is a platform that has finally stopped subsidizing growth. Average bookings per DAU rose to 12.97 dollars, up from 11.05 a year ago. International revenue is now 76% of bookings. The 17-and-older cohort grew DAUs by 36% — the fastest-growing segment, and the one with the highest payment rates. The question for 2026 is not whether Roblox is a real business — it clearly is — but whether the market is willing to pay 9x sales for a developer platform that is still 18 months away from sustained GAAP profitability.

Ark Invest reduced its Roblox position from 8.2 to 4.1 million shares between Q3/2025 and Q1/2026 — Cathie Wood took half her profits at higher prices, then reversed and added 1.8 million shares back in March at 43 dollars. Tiger Global remains a top-10 holder. Notable recent buys: Coatue Management, +12.4 million shares in Q1/2026 — their first Roblox position. Pat Dorsey Capital Management (the moat investor) initiated a new 2.1% portfolio position at 41 dollars. Bears: Citron Research published a short report in February 2026 questioning user engagement metrics — the stock dropped 14% in two sessions but recovered within four weeks.

At 42.84 dollars the market cap is 30.7 billion dollars. On 2026 estimated revenue of 5.3 billion that is 5.8x sales — not 9x as some screens suggest, because consensus has caught up. Versus historical 2021–2024 range of 11–18x sales, this is a 70% discount. Free cash flow yield is 1.0% trailing — still thin but expanding fast. The implied 2027 multiple at consensus estimates is 4.4x sales and 31x FCF.

The 65.83 dollar median analyst target reflects a re-rating to 7.0x 2026 sales — still well below historical norms. Bear case: 28 dollars (3.7x sales, recession + engagement decline). Bull case: 95 dollars (10x 2026 sales, profitability acceleration + AI creator moat). Asymmetric upside, but volatility will remain extreme.

1. August 7, 2026: Q2/2026 earnings — first quarter under new bookings-disclosure cadence, watch for the 17-plus cohort growth rate
2. September 2026: Roblox Developers Conference 2026 — likely Cube AI feature unveils that materially change content creation economics
3. Q4/2026: First holiday season with ad-supported tier — direct revenue contribution gauge

Roblox is the highest-conviction asymmetric trade I see in US large-cap tech right now. The chart is broken, the narrative is hostile, but the underlying metrics — DAU growth, bookings per user, FCF turn — all point the right way. The 71% drawdown from peak has wrung out the speculation; what is left is a platform with 98 million DAUs, a working creator economy and a clear path to a 15% adjusted EBITDA margin by 2027. I would not bet the farm — this is a 2–3% position sized to volatility — but if I owned five names from the broken-2021-IPO bucket, Roblox would be one of them. The risk is real. The asymmetry is more real.