The online gaming platform has faced heavy hits on engagement and stock following a new age check policy.
LAS VEGAS (CN) — A Roblox shareholder claims in a suit filed Tuesday the video game company’s top executives and board misled investors on how mandatory age checks would hurt user engagement.
In January, Roblox rolled out AI-based facial age estimation globally to control who can use the platform following lawsuits and investigations over child safety. Daniel Colbert, who says he has held Roblox stock since at least 2023, claims that on earnings calls and at a conference, executives said the effects had been studied and historical engagement trends had not faltered.
“We knew that (age checks) would create some headwind in terms of engagement and bookings,” Chief Financial Officer Naveen Chopra said at the investor conference in March, according to Colbert, adding that the company had factored data from early-rollout testing into its guidance.
On April 30, Roblox cut its bookings growth forecast this year from 22-26% to 8-12%, lowering expected bookings from roughly $8.55-$8.8 billion to $7.33-$7.6 billion, Colbert says. Executives said fewer users were using the service’s communication feature because unverified users could no longer chat and adults could no longer message users under 16.
They also cited lower app store ratings that may have reduced organic sign-ups. Only 51% of daily active users had completed an age check, according to Colbert.
Roblox’s stock fell about 18%, from $55.26 to $45.13, the next day.
Colbert also accuses founder and CEO David Baszucki of selling 9.3 million shares between November 2024 and this past February for about $756 million while possessing nonpublic information. The investor calls the sales “highly suspicious in both timing and amount,” but does not detail what information Baszucki held at the time of each sale.
Colbert says the company has been harmed by legal costs, compensation paid to the defendants and reputational damage. Roblox already faces two federal securities class actions in the Northern District of California.
Represented by John P. Aldrich of Aldrich Law Firm and Michael I. Fistel, Jr. of Johnson Fistel, Colbert sued in Clark County District Court claiming breach of fiduciary duty, unjust enrichment and corporate waste. He names Baszucki, Chopra, former CFO Michael Guthrie and six company directors, along with Roblox as a nominal defendant.
Roblox and Colbert’s attorneys did not immediately respond to a request for comment.
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