Investing.com — Citi analysts see further upside for Roblox shares despite the stock’s sharp rally since first-quarter results, citing strong second-quarter user data and a favorable U.S. court ruling on App Store fees.
“Roblox’s equity has performed well since 1Q25 results. However, we still see upside,” Citi wrote, pointing to “remarkably robust” third-party data from RoMonitor and the potential benefit of lower platform fees after the April 30 ruling that Apple (NASDAQ:AAPL) must allow third-party payments.
The analysts highlighted that Roblox stock has surged about 55% since its May 1 earnings report, suggesting the market is now pricing in roughly $880 million in annual EBITDA. But they argue there’s room for further gains.
“RoMonitor suggests CCUs averaged 12.4 million” during the second quarter, Citi said.
Based on a regression model, that data implies Roblox may report 26.7 million payers and $1.56 billion in bookings for 2Q25.
If accurate, that would be “32% ahead of the high-end of Roblox’s 2Q25 Bookings guidance,” wrote the bank.
The court ruling on App Store fees could also be a major tailwind. Apple accounts for about 30% of Roblox’s revenue, and Google (NASDAQ:GOOGL) Play about 16%, according to the company’s latest 10-K.
Citi estimates that lower platform fees could boost EBITDA by between $220 million and $600 million, depending on the geographic scope and implementation across platforms.
Given these developments, Citi raised its price target on Roblox from $100 to $123 per share, maintaining a Buy rating.
“We are raising our estimates to reflect our incremental upside from the RoMonitor data,” the analysts wrote, noting the new target still reflects around 50 times 2026 free cash flow per share.
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