Roblox's Bottom Line Still in the Red: When Will Profitability Arrive?

Despite explosive top-line growth and record-breaking user engagement, Roblox Corporation RBLX continues to grapple with an unprofitable business model. In second-quarter 2025, the company reported a loss per share of 41 cents, marking yet another quarter in the red, even as revenues soared 50% year over year to $1.44 billion and bookings jumped 51% to $1.4 billion.

The company is firing on all cylinders in terms of platform activity. Daily Active Users surged 41% to 111.8 million, hours engaged climbed 58% and monthly unique payers hit an all-time high. Viral hits like “Grow a Garden” attracted users and more than 75% of its DAUs interacted with at least one other experience on the same day, signaling healthy cross-platform engagement.

But monetizing that engagement remains a challenge. Roblox continues to prioritize reinvestment in its creator ecosystem, spending a record $316 million on DevEx payouts during the quarter. The new Creator Rewards program also signals a commitment to sharing revenues, further delaying the path to profit.

While CFO Naveen Chopra highlighted strong free cash flow and a $4 billion liquidity cushion, he also acknowledged that translating viral momentum into sustained, platform-wide monetization is still a work in progress.

Roblox may be building the infrastructure for long-term growth, but for investors, the lingering question remains: when will scale finally translate to sustainable profitability? Until then, the company’s bottom line is likely to remain a weak link in an otherwise compelling growth story.

RBLX’s Price Performance, Valuation and Estimates

RBLX’s shares have gained 106.2% in the past six months compared with the industry’s increase of 18%. In the same time frame, shares of other industry players, such as Take-Two Interactive Software, Inc. TTWO and Electronic Arts Inc. EA, have gained 6.9% and 23.4%, respectively.

Price Performance

With the recent gain, RBLX is priced at a premium relative to its industry. Its forward 12-month price-to-sales ratio of 13.17 is well above the industry average. Meanwhile, Take-Two Interactive and Electronic Arts’ forward 12-month price-to-sales ratios are 5.8 and 5.12, respectively.

P/S (F12M)

The Zacks Consensus Estimate for 2025 loss per share has widened to $1.68 in the past seven days. In 2024, the company reported adjusted loss per share of $1.44. Meanwhile, Take-Two Interactive and Electronic Arts’ earnings in fiscal 2026 are likely to witness growth of 33.2% and 21.1%, respectively.
 

RBLX currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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This article originally published on Zacks Investment Research (zacks.com).

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