Written by Zaheer Kachwala

Feb 5 (Reuters) – Roblox on Thursday said it expects fiscal 2026 bookings to exceed Wall Street expectations, suggesting player spending and engagement will continue to grow strongly this year as the video game platform aggressively seeks 10% of the global gaming market.

The company’s stock price rose about 23% in after-hours trading.

Amid fierce competition for user attention and revenue, Roblox has pursued several avenues to maintain and expand its large user base, including advertising and e-commerce. Average daily active users increased 69% year-over-year to 144 million in the fourth quarter.

The company said its profit margins will be flat to slightly down this year due to investments in security measures, server infrastructure upgrades to accommodate platform growth, and increased dividends to stimulate the developer community.

Roblox said 2026 will be the last year it will provide full-year forecasts, and starting next year it will only provide quarterly forecasts.

Roblox Chief Financial Officer Naveen Chopra told Reuters: “The difficulty in predicting and predicting the business is primarily driven by the virality of the content.”

“There was no way to predict what ‘Grow a Garden’ or ‘Steal a Brain Rot’ would do in 2025…At the end of the day, it’s going to be a function of a ton of viral hits that we have no control over,” he added.

Roblox last year introduced facial recognition and rules requiring users to verify their age to chat with other players, as it faces increased scrutiny from U.S. states and international governments for not doing enough to protect children on its platform.

Chopra said this feature had a mid-single-digit impact on engagement growth and a low-single-digit impact on booking growth.

According to data compiled by LSEG, Roblox expects bookings for 2026 to be between $8.28 billion and $8.55 billion, higher than the expected $7.87 billion.

Bookings for the quarter were $2.22 billion, beating expectations of $2.05 billion.

(Reporting by Zaheer ‌Kachwala in Bengaluru; Editing by Alan Barona)