Could Roblox Help You Become a Millionaire?

Roblox (NYSE: RBLX) was once a hot stock. The gaming platform developer went public via a direct listing on March 10, 2021. Its stock started trading at $64.50 and eventually more than doubled to a record high of $134.72 on Nov. 19, 2021. At the time, investors were dazzled by its rapid growth, its sticky ecosystem, and its popularity with tween players.

But at the time of this writing, Roblox's stock trades at around $70. It lost its luster as it lapped its pandemic-driven growth spurt, racked up more losses, and grappled with safety and regulatory issues. Could it eventually bounce back and generate millionaire-making gains over the next decade?

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Image source: Roblox.

Roblox is still expanding in its niche market

Roblox allows its users to create games and other experiences with a simple drag-and-drop system that doesn't require any prior coding knowledge. Its marketplace also offers premade assets and templates that further simplify that process. Its higher-level users can use Lua, a popular scripting language for video games, to add more sophisticated features.

Roblox's creators can monetize their games with an in-game currency called Robux. That creator-driven cycle fuels the platform's growth by pulling in more players and driving them to buy more Robux.

Roblox's simplicity drew in a lot of tween users during the pandemic's height, when most students stayed at home and spent a lot of time in front of their computers. It's also building an advertising ecosystem as more brands set up virtual "metaverse" worlds on its platform.

If we look back at Roblox's growth in bookings, daily active users (DAUs), average bookings per daily active user (ABPDAU), and total hours engaged, we'll see that its growth decelerated in 2022 after it lapped its pandemic-driven growth spurt in 2021. The bears argued that Roblox was just a fad, and that its long-term growth would stall out as its tween users outgrew its platform.

Data source: Roblox.

But in 2023 and 2024, Roblox's bookings growth accelerated again as it expanded overseas and attracted older creators and players. Those newer DAUs generated lower bookings than its core audience of tween users in the U.S. and Canada, but its engagement hours are still rising. That stickiness might pave the way for higher Robux sales and stronger bookings growth in the future.

In the first quarter of 2025, Roblox's bookings grew 31% year over year. Its DAUs rose 26% to 97.8 million, its ABPDAU increased 4%, and its total hours engaged jumped 30% to 21.7 billion. That acceleration counters the bearish notion that it's a fad stock that will simply fade away, and supports the bullish idea that its creator-driven cycle will drive its long-term expansion.

For the full year, Roblox expects its bookings to grow 21% to 23% as its adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) increases 14% to 47%. But it's still deeply unprofitable on a generally accepted accounting principles (GAAP) basis -- and it's still spending a lot of money on strengthening its digital safeguards for children, exchanging cash for its creators' accumulated Robux (its "developer exchange fees"), and expanding its cloud infrastructure.

Could Roblox churn out millionaire-making gains?

With a market cap of $47.78 billion, Roblox trades at 9 times this year's bookings. It's not a bargain, but it also doesn't seem that expensive if it can consistently grow its bookings by the double digits.

For now, analysts expect its bookings to grow at a compound annual growth rate (CAGR) of 20% from 2024 to 2027. Assuming it can maintain that growth rate for another eight years, its annual bookings could reach $32.25 billion in 2035. If it still trades at 9 times its forward bookings by the final year, its market cap would rise sixfold to $290.25 billion over the next 10 years.

That gain could turn a $10,000 investment into more than $60,000, but it probably won't generate millionaire-maker gains unless you buy a lot more shares. Roblox could also face more growing pains over the next few years if it can't balance the costs of protecting its younger users and expanding its cloud infrastructure with its top-line growth.

Roblox might still be a good investment for patient investors, but it probably won't become a millionaire-maker within the next decade. It's carved out a high-growth niche, but it needs to keep its platform safe and prove its business model is sustainable if it wants to evolve into a much larger company.

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Leo Sun has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Roblox. The Motley Fool has a disclosure policy.