- RBLX
-4.89%
Roblox (NYSE:RBLX) shares fell 4.0% in pre-market trading after Jefferies downgraded the stock to Underperform from Hold and lowered its price target to $38.
The new price target represents approximately 18% downside from Friday’s closing price. Jefferies said its downgrade reflected its assessment that the roughly 30% increase in Roblox shares following the company’s second-quarter results had incorporated expectations for bookings growth over the next 12 months that the firm considers too high.
The brokerage highlighted the U.S. and Canada market, known as UCAN, where it expects user and monetization growth to recover more slowly and require greater spending than currently reflected in market expectations.
Jefferies Points to UCAN User Trends
Jefferies cited daily active user trends in the U.S. and Canada as part of its assessment. According to the firm, UCAN daily active users reached a peak of around 26 million in late 2025, with some of the increase associated with viral content that experienced high churn rates.
The brokerage cited these trends as a factor in its expectations for the company’s engagement and bookings growth.
The Jefferies downgrade follows previous rating reductions by other analysts related to monetization trends.
Legal Proceedings Remain in Focus
The downgrade also comes as Roblox faces legal proceedings, including a lawsuit brought by Los Angeles County concerning alleged child exploitation on the platform.
A court recently allowed the lawsuit to proceed. The ruling permits the case to continue and does not constitute a finding that the allegations against Roblox have been proven.
Roblox Falls Alongside Broader US Market
Roblox’s pre-market decline came as major U.S. equity indexes also moved lower. The Nasdaq declined 1.0%, the S&P 500 fell 0.5% and the Dow Jones was down 0.4%.
The gaming and online creator market is also seeing new product developments from competitors, including Meta’s AI-powered Horizon Create tools.
Roblox shares remained lower in pre-market trading following the Jefferies rating change and against the broader decline in U.S. equities.
Roblox Corporation stock price
