By Mackenzie Tatananni

Roblox stock rose Tuesday after the videogame company said it is partnering with Google to expand its burgeoning ad business.

The collaboration with Alphabet-owned Google is a "foundational element in Roblox's advertising vision," allowing the company to scale its immersive ad formats to meet brands and agencies, Roblox said. Shares were up 2.5% to $59.72.

The app said advertisers will be able to purchase so-called Rewarded Video ads directly and through Google's advertising solutions in the coming weeks.

Rewarded Video ads are full-screen advertisements within certain Roblox games that last up to 30 seconds. Users who choose to watch them can receive digital currency and other perks from the ad publishers, which can be redeemed in-game.

Roblox also on Tuesday announced additional partnerships with Cint, DoubleVerify, and media analytics giant Nielsen to offer third-party advertising tools, such as performance solutions and audience reach metrics.

Roblox reported 85.3 million daily active users at the end of 2024, but keeps most demographic information under lock and key. In Tuesday's news release, Roblox said it had identified a key advertising opportunity with "tens of millions" of Gen Z users, generally defined as 13 to 28 years old.

Last year, Piper Sandler surveyed 13,515 teens with an average age of 15.8 years and found that Roblox active usage had grown to 46% in fall 2024, up from 34% in the spring. Roblox reported in 2023 that it had more users aged 13 and older, rather than under 13, for the first time, but didn't provide exact figures.

Stephanie Latham, Roblox's vice president of global brand partnerships and advertising, said Tuesday that the company was "continuing to remove barriers for brands and agencies that are quickly realizing the massive potential of immersive gaming platforms like Roblox where Gen Z are increasingly spending their time."

Write to Mackenzie Tatananni at mackenzie.tatananni@barrons.com

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April 01, 2025 12:25 ET (16:25 GMT)

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