Core Viewpoint - Roblox reported strong Q2 performance, leading to an upward revision of its 2025 guidance, prompting Morgan Stanley to maintain an "overweight" rating and raise the target price from $125 to $150, indicating nearly 20% upside potential from the last closing price of $125.03 [1] Financial Performance - Q2 revenue increased by 21% year-over-year to $1.08 billion, with bookings rising 51% to $1.44 billion, significantly exceeding management's guidance of 22%-25% and the median investor expectation of 40% [1] - Adjusted EBITDA reached $320 million, up 180% year-over-year, surpassing management's guidance of $160-$180 million; free cash flow was $177 million, a 58% increase, also exceeding the expected range of $105-$120 million [2][1] User Engagement - Average daily active users grew by 41% year-over-year to 1.12 million, with user engagement hours increasing by 58% to 27.4 billion hours; daily active user bookings rose by 7%, marking the highest year-over-year growth since Q1 2021 [1] - The success of the game "Grow a Garden" contributed approximately $140 million in Q2 bookings, with over 75% of its daily active users also engaging with at least one other experience on the platform [2] Growth Outlook - The company raised its 2025 bookings growth guidance from 21%-23% to 34%-37%, with adjusted EBITDA guidance increased to $1.28-$1.34 billion (66% year-over-year growth) and free cash flow guidance raised to $1.025-$1.085 billion (69% year-over-year growth) [4] - The Q3 bookings guidance suggests a 41%-45% year-over-year increase, significantly above market consensus of 18% and Morgan Stanley's expectation of 25% [3] Market Position and Future Potential - Roblox is gradually capturing more time and spending from video game users, with significant potential for monetization through advertising and e-commerce, supporting sustained bookings growth of over 20% [4] - If the growth trend continues, there is further upside potential for the company's valuation [4]