Unity Software announced second quarter 2022 financial results, which show 9% growth year-over-year and revenue of $297 million for the three-month period that ended June 30. Unity CEO John Riccitiello said the results are consistent with the company’s last update, but well below the standard Unity set for itself in regards to growth and value.
Unity CEO shortly addressed the elephant in the room, Applovin’s proposal to merge with Unity, saying:
“As everyone is aware, we received the proposal and I want you to know that we aren’t going to make any comments at this time.”
Back in July 2022, Unity entered into an agreement to merge with ironSource and Applovin’s proposal to merge would have the tech giant terminate the existing deal with ironSource. However, Unity CFO Luis Felipe Visoso shone a bit of light on where Unity stands with this proposal. Visoso said the following:
“We’re confident that the ironSource merger will make us stronger as we offer our customers an end-to-end platform that will benefit creators and shareholders.”
While this isn’t an official rejection of Applovin’s proposal, it somewhat shows that Unity is likely to stay with ironSource. Things can change drastically in heartbeat though, and the business world is no stranger to big deals not going through.
Unity Q2 2022 in numbers
Unity didn’t have the best month but delivered revenue at the high end of its guidance range. Unity Create was the heavy lifter of the quarter, generating revenue of $121 million, up by 66% from a year ago.
Unity’s operate solution earned the company a little over $159 million, but declined 13% compared to a year ago.
- Revenue: $297 million (9% up)
- Operating Expenses: $397.8 million
- Net loss: $204.1 million
- Net loss per share: $0.69
However, the company’s non-GAAP loss from operations was reported as $44.1 million, or 15% of revenue. Having said that, most of the operating expenses are for the research and development division, which is responsible for coming up with new and innovative products and services for Unity.
Earlier this summer, Unity had to let go 4% of its workforce —mainly from the AI and engineering divisions— in order to realign its sources.
Unity’s full-year forecast
For the full financial year, Unity Software gives guidance of $1.3 billion to $1.35 billion, a reduction from $1.35 billion to $1.45 billion shared during the software giant’s last earnings call.
The company expects revenue between $315million to $335 million for Q3 2022 and projects Q4 revenue of $368 million to $398 million.
Unity management also expects a strong performance increase for the upcoming two quarters. Visoso said, they expect to see a growth of 14% year-over-year in Q3 2022 and 21% year-over-year growth for Q4 2022.
