Roblox (NYSE:RBLX) shares are up in today’s trading after the metaverse company launched video ads across its platform and made them available to all advertisers following a six-month pilot phase. These ads will appear on virtual billboards and screens within the game’s digital worlds. This move is part of Roblox’s effort to diversify its revenue sources, which have relied heavily on in-game purchases and premium subscriptions up until now.
The video ads are aimed at Roblox’s Gen Z audience, who make up more than half of its 71.5 million daily active users and are the platform’s highest spenders. Stephanie Latham, vice president of global brand partnerships at Roblox and a former Meta advertising executive, emphasized the opportunity for brands to form deeper connections with this key demographic.
Roblox also formed partnerships with media measurement firms like Integral Ad Science and Kantar and recently teamed up with ad-tech company PubMatic (NASDAQ:PUBM) to boost the sale of these immersive video ads.
Is Roblox Stock a Buy or Sell?
Turning to Wall Street, analysts have a Moderate Buy consensus rating on RBLX stock based on 12 Buys, five Holds, and two Sells assigned in the past three months, as indicated by the graphic below. After a 21% year-to-date decline, the average RBLX price target of $49.72 per share implies 37.5% upside potential.
