Despite Roblox Corporation (RBLX.US) reporting better-than-expected results for the fourth quarter of 2025 last week, several investment banks have lowered their ratings and price targets for the company. Roblox projected first-quarter 2026 bookings between $1.69 billion and $1.74 billion, surpassing market expectations of $1.68 billion. Additionally, the company announced that, due to the "inherent volatility" of its operations, it will no longer provide annual performance guidance starting in 2027. Instead, it will focus on issuing quarterly forecasts.

Citigroup analyst Jason Bazinet reduced his price target for Roblox from $152 to $119 last week while maintaining a "Buy" rating. This adjustment reflects an update to the bank's financial model following the release of Roblox's Q4 2025 results and takes into account the recent contraction in valuation multiples observed among the company's industry peers. In the same week, Piper Sandler lowered its price target from $125 to $100, keeping an "Overweight" rating. The firm noted that the stock outperformed the broader market after earnings showed a 63% year-over-year increase in bookings, which exceeded its expectations and alleviated prior concerns. Despite this growth, the firm pointed out that the pace has slowed compared to the 70% year-over-year growth seen in the previous quarter.

Furthermore, UBS reduced its price target for Roblox from $103 to $74, with a "Neutral" rating. The bank acknowledged that the company's Q4 2025 performance was strong and its 2026 outlook exceeded expectations. Although a positive market reaction to these results was anticipated, the bank expressed concerns that competition and the emergence of new AI platforms may continue to weigh on the stock price.