Artisan Partners, an investment management company, released its fourth-quarter 2025 investor letter for “Artisan Mid Cap Fund”.  A copy of the letter can be downloaded here. The Fund seeks to invest in companies that possess franchise characteristics, with strong earnings trajectories, and are trading at a discount to the estimated private market value. US equities ended a record year with robust fourth-quarter gains. The Fund’s Investor Class, ARTMX, delivered -0.44%, the Advisor Class, APDMX, delivered - ...

Financial Data and Key Metrics Changes - In 2025, the company exceeded its guidance with a revenue growth of 36% and bookings growth of 55% year-on-year [4] - Q4 revenue was $1.4 billion, up 43% year-on-year, while Q4 bookings reached $2.2 billion, which is up 63% year-on-year [5][6] - The company reported a significant increase in daily active users (DAUs) by 69% year-on-year, reaching 35 billion engagement hours, an increase of over 88% year-on-year [6] Business Line Data and Key Metrics Changes - The top 1,000 creators earned an average of $1.3 million, up over 50% compared to the previous year [7] - Developer Exchange (DevEx) in Q4 was $477 million, reflecting a 70% year-on-year increase [6] Market Data and Key Metrics Changes - The US and Canada market grew by 41% year-on-year, while APAC saw a remarkable growth of 96% year-on-year, with Japan at 160%, India at 110%, and Indonesia over 700% [6] Company Strategy and Development Direction - The company aims to capture 10% of the $200 billion global gaming content market, currently at about 3.4% [5] - The focus is on expanding genres and targeting older audiences, with the 18+ demographic growing at over 50% and monetizing 40% higher than younger cohorts [9] - The strategy includes vertical integration from cloud to engine to tooling, enhancing user experience across devices [10] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving over 20% growth in 2026, driven by a healthier platform and the potential of AI to expand beyond gaming [19][20] - The company plans to provide detailed guidance for 2026 and shift to quarterly guidance by 2027 [21] Other Important Information - The company is investing in safety marketing to educate users about online safety measures [23] - The age verification rollout has seen strong adoption, with approximately 60% of DAUs age-checked in initial markets [16] Q&A Session Summary Question: Insights on bookings outlook and content schedules - Management highlighted internal indicators such as content diversity and engagement trends, which support their bookings outlook [28][29] Question: Targeting the 18+ demographic and AI gaming developments - The company is optimistic about the potential of AI to enhance user experiences and expand the definition of gaming [33] Question: Key lessons learned about discovery on the platform - Management emphasized the importance of long-term engagement and health of the platform over short-term gains in discovery optimization [40] Question: Update on gross margins and direct payments - The improvement in gross margins was attributed to better-than-expected bookings growth and a shift towards lower-cost payment platforms [46] Question: Concerns about AI disruption from competitors - Management views AI as an opportunity to expand Roblox's vision beyond gaming, focusing on multiplayer technology and cloud synchronization [48] Question: Age verification rollout and its impact - The rollout has been successful, with age-checking enhancing matchmaking and user engagement [65] Question: Q1 bookings guidance and sequential decline - Management noted that the absence of a new viral hit is expected to result in a sequential decline, but the overall health of the platform remains strong [68]

Core Viewpoint - JPMorgan maintains a Neutral rating and a $100 price target on Roblox, citing a decline in recent engagement metrics [1] Engagement Metrics - Roblox's peak concurrent users decreased to 23 million over the past weekend, down from 26 million the previous week, marking the lowest Saturday peak since early June [2] - The game Escape Tsunami reached approximately 5 million concurrent users, but its growth was overshadowed by a decline of about 3 million concurrent users for Steal a Brainrot, despite the recent success of Plants vs. Brainrots [2] External Factors - JPMorgan indicated that Winter Storm Fern likely did not significantly impact the engagement data, as increased engagement from children staying home was countered by power outages affecting over 200,000 households on Saturday and up to 750,000 by Sunday morning [3] Weekday Trends - Weekday engagement trends appeared more stable, with non-peak usage remaining largely unchanged week over week, even after accounting for the Martin Luther King Jr. holiday [4] - A slower weekend event calendar may have contributed more to the engagement decline than changes in age verification, with overall engagement results being disappointing and year-over-year trends moderating again after showing signs of stabilization the previous week [4]

Group 1 - Roblox Corporation (NYSE:RBLX) is recognized as one of the top 10 new stocks to buy in Ray Dalio's portfolio [1] - BMO Capital has reaffirmed an Outperform rating and a price target of $155 for Roblox, driven by the release of a new game titled "Escape Tsunami For Brainrots!" which aims to leverage the success of another game, "Steal a Brainrot" [1] - Wells Fargo has reduced its price target for Roblox from $141 to $107 while maintaining an Overweight rating, citing a decrease in growth estimates for 2026 bookings from 31% to 21% year-over-year [2] Group 2 - Roblox operates an interactive entertainment platform that allows users to create, share, and experience 3D virtual worlds and games [3] - The company is expected to provide guidance for bookings between $7,850 million and $8,000 million for the fiscal year, indicating a growth of 19%-21% [2]

Core Viewpoint - Roblox Corporation (NYSE:RBLX) is identified as an under-the-radar stock with significant upside potential heading into 2026, despite a recent share price decline of over 19% following its fiscal Q3 2025 earnings release [1] Financial Performance - For fiscal Q3 2025, Roblox reported a revenue increase of 70.30% year-over-year, reaching $1.92 billion, which exceeded consensus estimates by $221.89 million [3] - The company reported an EPS of negative $0.37, which was better than expected by $0.14 [3] - Management anticipates a full-year net loss between $1.10 billion and $1.13 billion, higher than the Bloomberg consensus estimate of $1.09 billion [3] - For fiscal Q4, the expected net loss is projected to be between $1.35 billion and $1.40 billion, also above the $1.34 billion estimate [3] Analyst Ratings - Brian Pitz from BMO Capital reiterated a Buy rating on Roblox with a price target of $155 on November 19 [2] - Cory Carpenter from J.P. Morgan also maintained a Buy rating on November 17, although no price target was disclosed [2] Market Engagement - Analyst Carpenter noted that Roblox's platform is gaining traction, with a year-over-year increase in user engagement [4] - Popular games on the platform, such as Steal a Brainrot and 99 Nights in the Forest, are expected to continue gaining momentum, supporting overall platform performance [4] Company Overview - Roblox operates an interactive platform that allows users to create, play, and socialize in immersive 3D experiences developed by a global community of creators [4]

Core Insights - Roblox has raised its annual bookings forecast for the third time this year, driven by strong in-game spending on popular titles [1] - The company has surpassed 150 million daily active users, indicating robust engagement and growth in its user base [1] Financial Performance - The increase in bookings forecast reflects a positive trend in revenue generation from in-game purchases [1] - Viral titles such as "Steal a Brainrot" have significantly contributed to the company's financial success [1]

Group 1 - Roblox Corporation (NYSE:RBLX) is included in the Renaissance Technologies Portfolio as one of the 10 biggest stocks [1] - JPMorgan raised the price target for Roblox Corporation to $160 from $150, maintaining an Overweight rating [2] - The increase in engagement on Roblox's platform during Q2 was driven by the game "Grow a Garden," with expectations for continued momentum in Q3 due to upcoming games [2][3] Group 2 - Concurrent users on Roblox reached 43 million in late August, surpassing the previous record of 32 million [3] - JPMorgan anticipates that the strong platform engagement will lead to a 'healthy upside' to management's guidance for Q3 [3] - The stock has gained 130% year-to-date as of September 23, 2025 [4]

Group 1: Roblox Performance - Roblox is experiencing significant growth with player counts showing triple-digit year-over-year growth rates, despite August typically being a slow month for the gaming industry [1][2] - The platform is benefiting from several "megascale experiences" that consistently attract millions of players, including titles like "Grow a Garden," "Steal a Brainrot," and "99 Nights in the Forest" [2] - Roblox stock is rated as outperform with a price target of 130, and it rose nearly 2% to 135.18 in midday trades [2] Group 2: Electronic Arts Performance - Electronic Arts (EA) is receiving positive feedback for its upcoming game "Battlefield 6," which is set to release on October 10, and is anticipated to be a major title for the industry [3] - EA's "Madden NFL 26" has also garnered positive feedback since its release on August 14 [4] - EA stock ranks third out of 25 stocks in the Computer Software-Gaming industry group, with an IBD Composite Rating of 77 out of 99, while Roblox ranks fourth with a Composite Rating of 75 [5]