Unity shares drop more than 30% and hit 52-week low as its financial outlook misses expectations
Unity has seen its shares hit a 52-week low after the release of its latest financial report. Investors were not satisfied with the company’s guidance, which forecast slowing growth.
Key takeaways from the report
- Unity reported revenue of $320.1 million for the first quarter (ended March 31), which is up 36% year-over-year.
- The company’s loss from operations was $171.2 million, which represents 53% of its revenue. It is up 54.3% compared to the loss for the first quarter of 2021.
- These numbers were within analysts’ expectations. However, Unity forecasted slowing growth for the second quarter, expecting revenue to reach $290-295 million, which would represent only a 6-8% growth year-over-year.
- According to Seeking Alpha, it is lower than previous estimates of $359.65 million.
- On top of that, Unity expects to reach $1.35-1.425 billion in revenue for the whole fiscal year, compared to estimates of $1.49 billion.
- The company lowered its guidance “due to challenges with monetization products that we expect to impact 2022.”
- As a result, Unity’s stock plunged over 30% in extended hours trading, to $34 per share. This means that the company has reached a new 52-week low.
- Unity shares are now trading at $35.86 in pre-market trading.
