Unity Software Inc. (U) came out with quarterly earnings of $0.15 per share, beating the Zacks Consensus Estimate of $0.05 per share. This compares to earnings of $0.06 per share a year ago. These figures are adjusted for non-recurring items.This quarterly report represents an earnings surprise of 200%. A quarter ago, it was expected that this company would post earnings of $0.19 per share when it actually produced earnings of $0.23, delivering a surprise of 21.05%.Over the last four quarters, the company h ...

PART I—FINANCIAL INFORMATION [Item 1. Financial Statements (Unaudited)](index=5&type=section&id=Item%201.%20Financial%20Statements%20%28Unaudited%29) This section presents Unity Software Inc.'s unaudited condensed consolidated financial statements for Q1 2024, including core financial statements and comprehensive notes [Condensed Consolidated Balance Sheets](index=5&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) The balance sheets show a decrease in total assets and liabilities from December 31, 2023, to March 31, 2024, with stable stockholders' equity Condensed Consolidated Balance Sheet Highlights (in thousands) | Metric | March 31, 2024 | December 31, 2023 | | :-------------------------- | :------------- | :---------------- | | Total Assets | $6,753,263 | $7,243,441 | | Total Liabilities | $3,338,539 | $3,829,063 | | Total Stockholders' Equity | $3,189,988 | $3,188,581 | | Cash and cash equivalents | $1,179,962 | $1,590,325 | | Convertible notes (liability) | $2,236,415 | $2,711,750 | [Condensed Consolidated Statements of Operations](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) Statements of operations indicate an increased net loss for Q1 2024, driven by higher operating expenses despite decreased revenue Condensed Consolidated Statements of Operations Highlights (in thousands, except per share data) | Metric | Three Months Ended March 31, 2024 | Three Months Ended March 31, 2023 | | :------------------------------------------------ | :-------------------------------- | :-------------------------------- | | Revenue | $460,380 | $500,361 | | Gross profit | $315,993 | $338,397 | | Total operating expenses | $690,922 | $593,381 | | Loss from operations | $(374,929) | $(254,984) | | Net loss | $(291,478) | $(253,703) | | Basic and diluted net loss per share attributable to Unity Software Inc. | $(0.75) | $(0.67) | [Condensed Consolidated Statements of Comprehensive Loss](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Comprehensive%20Loss) Comprehensive loss increased in Q1 2024 due to net loss and a negative foreign currency translation adjustment Condensed Consolidated Statements of Comprehensive Loss Highlights (in thousands) | Metric | Three Months Ended March 31, 2024 | Three Months Ended March 31, 2023 | | :------------------------------------------------ | :-------------------------------- | :-------------------------------- | | Net loss | $(291,478) | $(253,703) | | Change in foreign currency translation adjustment | $(3,461) | $3,157 | | Other comprehensive income (loss) | $(3,461) | $2,830 | | Comprehensive loss | $(294,939) | $(250,873) | [Condensed Consolidated Statements of Stockholders' Equity](index=8&type=section&id=Condensed%20Consolidated%20Statements%20of%20Stockholders%27%20Equity) Stockholders' equity increased from employee equity plans and stock-based compensation, partially offset by accumulated deficit Condensed Consolidated Statements of Stockholders' Equity Highlights (in thousands) | Metric | Balance at Dec 31, 2023 | Issuance from employee equity plans | Stock-based compensation expense | Net loss | Other comprehensive loss | Balance at Mar 31, 2024 | | :----------------------- | :---------------------- | :---------------------------------- | :------------------------------- | :------- | :----------------------- | :---------------------- | | Additional Paid-In Capital | $6,259,479 | $25,997 | $269,288 | — | — | $6,554,787 | | Accumulated Deficit | $(3,071,830) | — | — | $(291,074) | — | $(3,362,904) | | Accumulated Other Comprehensive Loss | $(5,009) | — | — | — | $(2,751) | $(7,760) | [Condensed Consolidated Statements of Cash Flows](index=9&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Cash flows shifted from net cash provided by investing and financing in Q1 2023 to cash used in financing in Q1 2024, due to convertible note repayments Condensed Consolidated Statements of Cash Flows Highlights (in thousands) | Metric | Three Months Ended March 31, 2024 | Three Months Ended March 31, 2023 | | :------------------------------------------------ | :-------------------------------- | :-------------------------------- | | Net cash used in operating activities | $(7,373) | $(5,099) | | Net cash provided by (used in) investing activities | $(7,190) | $88,111 | | Net cash provided by (used in) financing activities | $(389,001) | $21,971 | | Repayments of convertible note | $(414,999) | — | | Increase (decrease) in cash, cash equivalents, and restricted cash | $(409,766) | $108,134 | [Notes to Condensed Consolidated Financial Statements](index=10&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) These notes provide detailed explanations and disclosures for the condensed consolidated financial statements, covering accounting policies, revenue, financial instruments, and borrowings [1. Accounting Policies](index=10&type=section&id=1.%20Accounting%20Policies) This section outlines the basis of presentation for the financial statements, the use of estimates, and the accounting for employee separation and restructuring costs incurred in Q1 2024 - The company prepared its unaudited condensed consolidated financial statements in accordance with U.S. GAAP and SEC rules for interim financial reporting[29](index=29&type=chunk) - In Q1 2024, the company incurred approximately **$193 million** in employee separation costs, including **$126 million** of incremental stock-based compensation, and **$19 million** in restructuring costs, primarily due to a 25% workforce reduction and the departure of ironSource Ltd. founders[31](index=31&type=chunk) [2. Revenue](index=10&type=section&id=2.%20Revenue) Revenue is disaggregated by source (Create and Grow Solutions) and geography, showing a decline in total revenue Revenue Disaggregated by Source (in thousands) | Revenue Source | Three Months Ended March 31, 2024 | Three Months Ended March 31, 2023 | | :------------- | :-------------------------------- | :-------------------------------- | | Create Solutions | $163,670 | $187,369 | | Grow Solutions | $296,710 | $312,992 | | Total revenue | $460,380 | $500,361 | Revenue Disaggregated by Geography (in thousands) | Geography | Three Months Ended March 31, 2024 | Three Months Ended March 31, 2023 | | :------------- | :-------------------------------- | :-------------------------------- | | United States | $139,119 | $132,994 | | Greater China | $59,690 | $59,548 | | EMEA | $166,770 | $186,724 | | APAC | $84,036 | $107,528 | | Other Americas | $10,765 | $13,567 | | Total revenue | $460,380 | $500,361 | - Revenue recognized during Q1 2024 that was included in deferred revenue balances at January 1, 2024, was **$76.3 million**[37](index=37&type=chunk) - As of March 31, 2024, remaining performance obligations for contracts exceeding one year totaled **$357 million**, with approximately **$205 million (57%)** expected to be recognized in the next 12 months[38](index=38&type=chunk) [3. Financial Instruments](index=12&type=section&id=3.%20Financial%20Instruments) This section details the fair value measurement of cash, cash equivalents, and restricted cash, and notes that no adjustments were made to the carrying value of equity investments in unconsolidated entities during the reporting periods Cash, Cash Equivalents, and Restricted Cash (in thousands) | Category | March 31, 2024 | December 31, 2023 | | :------------------------------------ | :------------- | :---------------- | | Cash | $888,092 | $834,877 | | Restricted cash and cash equivalents | $306,409 | $769,390 | | Total cash, cash equivalents, and restricted cash | $1,194,501 | $1,604,267 | - Equity investments in certain unconsolidated entities without a readily determinable fair value totaled **$33.6 million** as of March 31, 2024, and December 31, 2023, with no adjustments to carrying value in Q1 2024 or Q1 2023[40](index=40&type=chunk) [4. Investment in Unity China](index=12&type=section&id=4.%20Investment%20in%20Unity%20China) This section provides information on the redeemable noncontrolling interests in Unity China, where third-party investors hold a 20.5% ownership, and the changes in these interests during the period Changes in Redeemable Noncontrolling Interests (in thousands) | Metric | Three Months Ended March 31, 2024 | Three Months Ended March 31, 2023 | | :------------------------------------------------ | :-------------------------------- | :-------------------------------- | | Balance at beginning of period

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 8-K CURRENT REPORT Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 Date of Report (Date of earliest event reported): May 9, 2024 (Exact name of registrant as specified in its charter) (State or other jurisdiction of incorporation) Delaware 001-39497 27-0334803 (Commission File Number) (I.R.S. Employer Identification No.) 30 3rd Street San Francisco, California 94103‑3104 (Address, including zip code, of princ ...

About this content About William Farrington William kickstarted his career as a researcher and reporter for a global legal publication, covering everything from public law to M&A. Before moving to Proactive Investors, he worked as a reporter for a major fintech company with a focus on cryptocurrency and blockchain technology. Harking from Queensland, Australia, William obtained first-class honours in journalism and media from Birkbeck University before going on to complete an MA in creative and critical ...

The most recent trading session ended with Unity Software Inc. (U) standing at $24.55, reflecting a +1.15% shift from the previouse trading day's closing. This move outpaced the S&P 500's daily loss of 0.34%. Elsewhere, the Dow gained 0.23%, while the tech-heavy Nasdaq lost 0.33%.Prior to today's trading, shares of the company had lost 7.54% over the past month. This has lagged the Computer and Technology sector's loss of 4.23% and the S&P 500's loss of 4.05% in that time.The investment community will be cl ...

Unity Software Inc. (U) closed at $22.89 in the latest trading session, marking no change from the prior day. This move lagged the S&P 500's daily gain of 0.87%. Elsewhere, the Dow gained 0.67%, while the tech-heavy Nasdaq added 1.11%.Shares of the company have depreciated by 15.19% over the course of the past month, underperforming the Computer and Technology sector's loss of 5.98% and the S&P 500's loss of 3.97%.Analysts and investors alike will be keeping a close eye on the performance of Unity Software ...

Investment Rating - The report initiates coverage on Unity (U.US) with a "Buy" rating and a target price of $31, indicating a potential upside of 19% from the current price of $26.05 [14][44]. Core Insights - Unity is a leading player in the game engine market, holding approximately 70% market share in mobile games and expanding into industries beyond gaming, such as architecture, automotive, and aerospace, which currently contributes 23% to its Create Solutions revenue [3][33]. - The integration of AI technologies, particularly through the Unity editor, is expected to enhance product competitiveness and drive long-term growth [4][16]. - The company's growth solutions, which include advertising networks and game publishing services, accounted for 61% of revenue in 2023, showcasing a strong network effect and data advantage [15][16]. Summary by Sections Game Engine Market Leadership - Unity dominates the game engine market with a significant presence in mobile gaming, where 70% of the top 1000 mobile games are developed using Unity [10][11]. - The company has a market share of approximately 50% on PC and 40% on consoles, with a 90% share in the AR headset market [10]. AIGC Impact on Content Development - The report suggests that AIGC (AI-Generated Content) will complement traditional content creation tools rather than compete with them, enhancing efficiency in the development process [4][41]. - Unity has integrated AI capabilities into its editor, allowing for proprietary model training and support for third-party AI models, which is expected to benefit the company in the long run [4][41]. Financial Projections - Revenue is projected to grow from $1.39 billion in FY22 to $2.29 billion by FY26, with a notable increase in adjusted EBITDA from -$71 million in FY23 to $758 million by FY26 [9][17]. - The report anticipates a shift towards profitability, with operating losses decreasing from -$882 million in FY22 to -$103 million by FY26 [9][17]. Valuation Analysis - The target price of $31 corresponds to a 6.5x P/S ratio for FY24E, reflecting confidence in Unity's market position and growth potential [16][17]. - The report highlights that Unity's upcoming Unity 6 product is expected to enhance performance and support for new technologies, contributing to revenue growth through the newly introduced Runtime Fee model [30][61]. Business Focus and Strategy - Unity is focusing on core business areas: engine, cloud, and monetization, aiming to achieve the "Rule of 40" by the end of the year, which combines revenue growth and profitability [76]. - The company plans to exit non-strategic businesses that contributed $283 million in revenue, allowing for a more concentrated effort on high-margin SaaS subscriptions and other growth areas [76].

Unity Software Inc. (U) ended the recent trading session at $25.36, demonstrating a +0.16% swing from the preceding day's closing price. The stock lagged the S&P 500's daily gain of 1.11%. On the other hand, the Dow registered a gain of 0.8%, and the technology-centric Nasdaq increased by 1.24%.Shares of the company have depreciated by 7.39% over the course of the past month, underperforming the Computer and Technology sector's gain of 0.85% and the S&P 500's gain of 0.48%.The upcoming earnings release of U ...

The most recent trading session ended with Unity Software Inc. (U) standing at $27.57, reflecting a +1.55% shift from the previouse trading day's closing. This change outpaced the S&P 500's 0.32% gain on the day. Elsewhere, the Dow gained 0.68%, while the tech-heavy Nasdaq added 0.2%.The company's stock has dropped by 11.94% in the past month, falling short of the Computer and Technology sector's gain of 6.04% and the S&P 500's gain of 5.11%.The investment community will be paying close attention to the ear ...

SAN FRANCISCO--(BUSINESS WIRE)--Unity (NYSE: U), the world’s leading platform of tools for creators to build and grow real-time games, apps, and experiences across multiple platforms, released the 2024 Unity Gaming Report today at the Game Developers Conference 2024 (GDC), revealing that while 2023 was a year marked with persisting economic headwinds, game developers are strategically navigating the challenges and successfully adapting to changes in technology, the economy, and player habits by doing more w ...