3 Things Roblox Must Get Right to Become a Profitable Company

Key Points

• Advertising is Roblox’s biggest profitability lever.

• Older users already make up most of Roblox’s daily active users, and retaining them as they spend more could dramatically improve monetization.

• International monetization is a massive untapped growth engine.

• 10 stocks we like better than Roblox ›

Roblox (NYSE: RBLX) has no trouble attracting users. More than 100 million people log in daily to play games, socialize, and build their own experiences. That kind of engagement is rare in digital media -- and it's why many investors see Roblox as a long-term growth story.

But engagement hasn't translated into profitability. The company continues to post steep losses while trading at a premium valuation. For Roblox to make the leap from cultural phenomenon to sustainable business, it must execute on a few critical priorities. Here are three things Roblox needs to get right to become a profitable stock.

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Image source: Getty Images.

1. Unlocking advertising at scale

So far, Roblox makes nearly all of its revenue from sales of its in-game currency, Robux. That leaves the business overly dependent on player spending. Advertising offers a way to diversify revenue -- and it could be far more profitable.

Roblox is rolling out immersive ad formats, including digital billboards inside games and video ads with rewards, for players over 13. The company even partnered with Google Ad Manager to make it easier for brands to buy campaigns and measure performance. Developers also receive a cut, giving them another income stream and strengthening the ecosystem.

The opportunity is significant. Even a modest $10 in annual ad revenue per user could bring in more than $1 billion in incremental, high-margin revenue. For perspective, Meta generated $13.65 in revenue per person in the second quarter of 2025, suggesting that the opportunity is massive for the gaming company.

But execution matters. Ads must fit naturally into the user experience, advertisers need proof of returns, and regulators will keep a close eye on how ads reach Roblox's large under-13 audience. If Roblox can get this balance right, advertising could be the key that finally unlocks operating leverage.

2. Aging up the user base

Roblox built its popularity among kids, but that strength also creates a ceiling. Younger players generate lower spending per user and bring regulatory challenges around advertising and data privacy.

The company knows this and has been working to "age up" the platform. For instance, the over-13-year-old cohort accounted for 71.4 million of its 111.8 million daily active users (DAU) in the second quarter of 2025. Comparatively, that cohort group had just 36.8 million DAU in the same period two years ago. This development is crucial since older users not only spend more but are also more appealing to advertisers.

As such, it's imperative that Roblox keeps this group of users engaged even as they grow up into their late teens or early adulthood. If Roblox can provide more sophisticated experiences -- through better graphics, social features, and content that appeals beyond children -- it could extend user lifetime value and drive higher monetization. If not, its core audience may churn just as they become the most valuable customers.

3. Driving international monetization

One of the most significant growth highlights for Roblox in recent quarters is its continuous global expansion, suggesting that its platform crosses culture and geography. But while overseas users have been growing, monetization outside North America still lags that of the U.S. For perspective, average bookings per daily active user in the U.S. were $40.7 in the second quarter of 2025, compared to just $4.95 in Asia-Pacific and $11.49 in Europe.

To close the gap, Roblox will need to localize content further, improve payment infrastructure, and partner with brands that resonate regionally. For example, offering local currency options or working with telcos to enable easier in-app payments could lift spending in emerging markets.

If Roblox can raise monetization levels overseas even modestly, it could add another meaningful layer of growth. Given the size of its international audience -- only 20.6 million of 111.8 million DAU are from the U.S. and Canada -- this may be one of the company's biggest untapped growth levers.

What it means for investors

Roblox has already proven it can capture attention on a massive scale. But attention alone doesn't make a profitable stock. The next phase is about turning engagement into earnings.

To get there, Roblox must:

1. Build a credible advertising business,
2. Retain and monetize older users, and
3. Lift international spending.

Investors who believe management can execute on these three priorities may see meaningful upside over the long run for this growth stock. But until profitability is within reach, Roblox remains a bold bet on potential rather than a proven investment.

Either way, it's worth keeping the stock on your radar.

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Lawrence Nga has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Meta Platforms and Roblox. The Motley Fool has a disclosure policy.