NYSE$U
Unity Software Inc. · Q2 2023 earnings
Q2 2023 earnings · · Investor relations
Briefing
Unity had a strong second quarter, with revenue and adjusted EBITDA exceeding guidance, also increasing the low-end of the revenue guide by $40 million.
Unity's Q2 2023 results showed strong performance with revenue of $533 million, representing 80% year-over-year growth. The company's GAAP net loss was $193 million, while adjusted EBITDA reached $99 million. Free cash flow for the quarter was $33 million, and adjusted EBITDA margins reached 18.5%.
- Revenue of $533 million, an increase of 80% year-over-year.
- GAAP net loss was $193 million and adjusted EBITDA was $99 million, an improvement of $136 million year-over-year.
- Free cash flow for the quarter was $33 million, which is reduced by one-time payments related to restructuring.
- Adjusted EBITDA margins of 18.5%, which compares to 6.5% in the first quarter of this year and negative 12.7% in the second quarter of the prior year.
Headline financials
Revenue & EPS history
Unity · Revenue · Quarterly
$533M
Revenue by segment
Unity · $533M total across 2 segments · Q2 2023
- Grow Solutions$340M+114.5%63.8%
- Create Solutions$193M+59.6%36.2%
Forward guidance
For the third quarter, Unity is guiding revenue of $540 to $550 million and adjusted EBITDA to $90 to $100 million. For the year, Unity is increasing the low-end of the revenue guide by $40 million to $2,120 - $2,200 million and guiding adjusted EBITDA to $320 to $340 million.
Tailwinds
- Assuming that the game ads market will be relatively flat throughout the balance of the year, other than normal seasonality.
- Assuming a continuation of a soft market in China.
- Assuming additional planned deceleration in Professional Services.
- Expect 477 million of fully diluted shares at the end of the third quarter and 488 million at the end of the fiscal year.
- Continue to be committed to reach $1 billion adjusted EBITDA run-rate by the end of 2024.
Headwinds
- Ongoing uncertain economic environment.
- Game ads market will be relatively flat throughout the balance of the year, other than normal seasonality.
- Continuation of a soft market in China.
- Additional planned deceleration in Professional Services.
- These estimates do not include the impact of any future repurchases that we may choose to make under our previously announced stock repurchase program.
Historical earnings impact
How earnings announcements have historically affected this stock's price.
Avg. return before/after earnings
Based on 20 quarterly earnings reports · overlaid with Q2 2023
+2.1%
Avg return
Earnings day
+3.9%
Avg return
5 days after
+5.8%
Avg return
30 days after
58%
14 / 24 earnings
Positive
+30.4%
Q4 2024
Best reaction
-39.9%
Q1 2022
Worst reaction
| Quarter | Report date | Reaction (Day 0) | +5 days | +30 days |
|---|---|---|---|---|
| Q1 2026 | -1.8% | -1.7% | +6.9% | |
| Q4 2025 | -26.3% | -35.7% | -33.1% | |
| Q3 2025 | +18.1% | +20.2% | +27.6% | |
| Q1 2025 | -3.1% | +2.4% | +17.9% | |
| Q4 2024 | +30.4% | +19.5% | +0.4% | |
| Q3 2024 | -5.4% | -11.3% | +27.9% | |
| Q2 2024 | +11.6% | +16.7% | +13.9% | |
| Q1 2024 | -10.0% | -4.4% | -28.3% | |
| Q4 2023 | -0.8% | -7.5% | -13.7% | |
| Q3 2023 | +3.6% | +12.0% | +25.5% | |
| Q2 2023 | -9.2% | -11.8% | -18.1% | |
| Q1 2023 | +14.8% | +6.1% | +28.4% | |
| Q4 2022 | -12.7% | -18.8% | -21.3% | |
| Q3 2022 | +17.1% | +37.6% | +42.8% | |
| Q2 2022 | +11.7% | +17.5% | -22.1% | |
| Q1 2022 | -39.9% | -22.4% | -18.0% | |
| Q4 2021 | +6.5% | +5.5% | -12.7% | |
| Q3 2021 | +8.2% | +20.6% | -14.2% | |
| Q2 2020 | +18.2% | +14.0% | +26.1% | |
| Q2 2021 | +10.1% | +16.9% | +21.7% | |
| Q1 2021 | +3.3% | +7.2% | +23.6% | |
| Q4 2020 | -13.3% | -13.7% | -36.7% | |
| Q4 2019 | +9.6% | +13.0% | +49.9% | |
| Q3 2020 | +8.7% | +11.8% | +44.4% | |
| Q1 2020 | — | — | — | |
| Q3 2019 | — | — | — | |
| Q2 2019 | — | — | — | |
| Q1 2019 | — | — | — |
Discussion
Share your read of this quarter. Sign-in carries your eToro identity.
Join the conversation
Sign in with eToro to post your read of this quarter and vote on others'.
Sign in with eToro