NYSE$U

Unity Software Inc. · Q3 2023 earnings

Q3 2023 earnings · · Investor relations

Briefing

Third quarter results were mixed, with revenue within guidance, costs managed well, and adjusted EBITDA exceeding guidance.

Unity's Q3 2023 results showed mixed performance with revenue of $544 million, a 69% year-over-year increase or 8% on a pro-forma basis. GAAP net loss was reduced to $125 million, and adjusted EBITDA was strong at $131 million. Free cash flow for the quarter was $104 million.

  • Revenue came in within guidance at $544 million, representing a 69% year-over-year increase.
  • GAAP net loss was reduced by half to $125 million, a net loss margin of (23%).
  • Adjusted EBITDA was strong at $131 million, resulting in a 24% adjusted EBITDA margin.
  • Free cash flow for the quarter was $104 million.

Headline financials

Total Revenue

$544M

Previous: $323M+68.5%
EPS (adj)

-$0.32

Previous: -$0.14-128.6%
Capital Expenditures

-$44.6M

Previous: -$42.3M-5.2%
Free Cash Flow

-$169M

Previous: -$292M+42.3%
Net Income

-$124M

Previous: -$250M+50.4%
Operating Income

-$127M

Previous: -$240M+46.8%
Gross Profit

$393M

Previous: $211M+86.2%
Cash & Equivalents

$1.51B

Previous: $1.24B+21.6%
Total Assets

$7.43B

Previous: $4.73B+57.1%
R&D Expense

$240M

No prior period
Stock-Based Comp

$147M

Previous: $154M-4.7%

Revenue & EPS history

Unity · Revenue · Quarterly

$544M

Q3 2023+68.5%vs Q3 2022
Beat estimate in 13 of 15 quarters(87%)
ActualEstimate

Revenue by segment

Unity · $544M total across 2 segments · Q3 2023

  • Grow Solutions
    $355M+106.8%
  • Create Solutions
    $189M+47.0%

Forward guidance

Given the ongoing assessment of product portfolio and cost structure, Unity is not providing guidance for the fourth quarter or the full year 2023, and will provide guidance for 2024 with our fourth quarter and full year 2023 results.

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 Q3 2023

Historical avgQ3 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

Earnings price reactions
QuarterReport dateReaction (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

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