Bank of America drops bold call on Roblox, sees massive upside | Official Website of Louis Velazquez, entrepreneur, finance guy and tech innovator

Roblox’s future depends on one question: Can it keep making hits?

The platform is getting ready for earnings season with a mixed configuration. Recent breakout titles helped growth, but third-party data reveals that user hours may have declined. That stress has caused Wall Street to splinter.

But Bank of America won’t back down. In fact, it doubled down on its bullish “hit factory” theory, saying that the market is ignoring Roblox’s deeper evolution. And with new experiences coming out quickly, the story could change completely in the next several quarters.

Earnings are near, and the debate around Roblox is getting sharper.

Photo by PATRICK T&period; FALLON on Getty Images

What if Roblox doesn’t slow down?

Bank of America believes Roblox is more than simply a game company; it’s a viral content engine.

BofA analysts say that since the end of 2024, enhancements to the ecosystem have made it more likely that breakthrough experiences will happen more often.

Bears are focusing on the possibility that the engine slows down. Bulls, in contrast, are focusing on the chances that the slowdown does not occur.

Roblox Q4 setup: new experiences and broader engagement

Bank of America shares that third-party tracking revealed less involvement in the “Top 2025 Hits” during the quarter (hours down 39% from the previous quarter, according to RoMonitor).

Bank of America’s main point, though, is that Roblox’s ecology seems to be growing beyond just the most popular games.

Based on its examination of RoMonitor data, Bank of America said engagement growth, excluding the top 10 games, sped up in Q4 to +63% year over year, up from +56% in Q3.

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It also said new entrants were ascending the charts by hours, with experiences like The Forge moving up to the top 10 and Scary Shawarma Kiosk rising to the top 20, as older releases such as Fish It! and RIVALS were still rising.

If that pattern holds, it supports a simple story. Roblox’s growth doesn’t depend on one big hit as much as it does on the platform’s capacity to keep generating them.

The numbers BofA raised, and what investors may be expecting

Bank of America raised its forecast for the fourth quarter, increasing bookings from $2.05 billion to $2.09 billion in its model.

The changes are thanks to an assumption that hours will expand by 84% per year, and that average bookings per hour will rise by 25% from one quarter to the next.

Bank of America also noted that talks with investors showed that the market is already leaning toward a minor beat versus guidance. This is important because when expectations increase quietly, “good” outcomes sometimes need to be outstanding to move a stock.

Why conservative language could be the real catalyst for 2026

Bank of America believes management’s 2026 guidance will be conservative because it’s hard to predict “hits” in general.

It also said that buy-side expectations will be rather low, with most investors only expecting one or two new viral hits and the most optimistic models expecting two to three.

Another thing that worries investors is whether the new adjustments to age verification could make people less likely to interact.

Bank of America added that its third-party checks did not show a significant headwind from the rollout, and it maintained its projection for bookings growth in the first quarter (+43% year over year).

Why BofA considers Roblox a “dip buying” setup

Bank of America’s $171 price projection is based on a 47x EV/CY27 EBITDA multiple, which is higher than the average for rapidly growing software companies.

The company also said Roblox’s value at the time of the note, which was about 26 times its EV/EBITDA over the next two years, was close to its lowest position since its IPO.

In short, if Roblox keeps cranking out hits, the upside isn’t only in the fundamentals; the market might also change how it rates the company based on how long it lasts.