Unity Software's stock skids 12% on revenue miss, uncertain outlook
By Jon Swartz
Unity Software Inc.'s stock fell about 12% in extended trading Thursday after the company reported a revenue miss and withheld from offering guidance.
"Our results in the third quarter were mixed," Unity (U) said in a letter to shareholders. "While revenue came in within guidance, we believe we can do better."
The beleaguered game-engine software company has been whipsawed by a series of missteps and departures. In September, it announced new fees based on the number of people who install games built with Unity's editor software -- only to backtrack and revamp its plan following a chorus of complaints that dented the stock. Last month, John Riccitiello announced he was retiring as chief executive, effective immediately.
Also read: Opinion: Unity Software has a fleeting moment to win back developers -- and investors
"While we did not expect the introduction of the fees to be easy, the execution created friction with our customers and near-term headwinds," Unity said in the letter. "We expect the impact of this business-model change to have minimal benefit in 2024 and ramp from there as customers adopt our new releases."
Unity executives are mulling several new strategies that include layoffs, a reduction in office space and product discontinuations, but it did not offer timing or guidance, according to the shareholder letter.
Unity reported a fiscal third-quarter net loss of $125.3 million, or 32 cents a share, compared with a net loss of $250 million, or 84 cents a share, in the year-ago quarter.
Revenue was $544.2 million, up from $322.9 million a year ago.
Analysts surveyed by FactSet had expected revenue of $554 million.
Shares of Unity have dipped 12% this year. The broader S&P 500 index is up 13% in 2023.
-Jon Swartz
This content was created by MarketWatch, which is operated by Dow Jones & Co. MarketWatch is published independently from Dow Jones Newswires and The Wall Street Journal.
(END) Dow Jones Newswires
11-09-23 2113ET
Copyright (c) 2023 Dow Jones & Company, Inc.-
What’s Happening in the Markets This Week
-
Worst-Performing Stock ETFs of the Quarter
-
Q3 in Review and Q4 2024 Market Outlook
-
Top-Performing Stock ETFs of the Quarter
-
September Jobs Report Forecasts Show Moderate Hiring Gains
-
Port Strike a Headache for Shippers but a Potential Tailwind for Certain US Transport Stocks
-
13 Charts on Q3′s Roller-Coaster Rally for Stocks and Bonds
-
5 Stocks to Buy Instead of Overpriced US Equities
-
Consumer Defensives: Despite Angst, Thirsty Investors Have Names to Pursue
-
Industrials: Many Stocks Overvalued After Q3 Outperformance
-
Basic Materials: Despite Index Rise, We See Multiple Long-Term Opportunities
-
What the Election Could Mean for Big Tech Stocks
-
3 Lessons From Recent Stock Market Drama
-
Consumer Cyclicals: Even Amid Moderating Consumer Spending, We See Discounts
-
Healthcare: Valuations Look Fair Overall, With Select Industries Still Undervalued
-
Utilities: Falling Interest Rates, Growth Outlook Boosting Stocks