Unity's valuation reached $18.1 billion after the IPO — twice as much as expected

Three days ago, Unity entered the stock exchange, where it raised $1.3 billion in a day. Against this background, the developer’s market capitalization has grown to $18.1 billion. Moreover, a week before the start of trading, Unity announced plans to raise the company’s valuation to just $9-11.1 billion.

A month ago, the American developer of the Unity engine applied for an IPO. At that time, the company did not disclose all the details of the upcoming placement, but shared them later — in mid-September. It was reported that Unity will sell 25 million shares at a price of $34-42 apiece.

Five days before the auction, Unity revised the stock price and raised it to $44-48. On the morning of Friday, September 18, 220 — the day of the IPO launch — the company’s securities were already worth $52. And by the evening, the price tag had risen to $68.88.

Due to high demand, Unity raised $1.3 billion on the first day of trading, and the company’s value reached $18.1 billion. For comparison, in 2019, the developer of the engine was estimated at $ 6 billion.

Today Unity is worth $1 billion more than its main competitor — Epic Games, the author of the Unreal Engine.

In early August, Epic also engaged in attracting investments and conducted the seventh round of financing, during which the company’s valuation increased to a record $17.3 billion. Then Epic managed to raise $1.78 billion in investments — this was the largest fundraising for the developer since 2018 ($1.25 billion).

At the same time, Epic earns significantly more than Unity.

In December 2019, the creators of Unreal Engine reported revenues of $730 million with revenue of $4.2 billion. At the same time, Unity’s revenue in 2019 amounted to $541.8 million. In addition, the latter reported a $163.2 million loss last year.

It is worth noting that despite the fact that Unity has suffered net losses for each period since its creation, the company’s revenue continued to grow. In the same 2019, the developer earned 42% more than in 2018 ($380.7 million). In the first half of 2020, Unity’s revenue increased by 39% compared to the same period last year ($351.3 million).

The money raised during the placement, Unity is going to spend on partial repayment of $125 million in debt, increasing financial flexibility for general corporate purposes and increasing the company’s liquidity.

Unity is the developer of the game engine of the same name, whose MAU is 1.5 million people. Such titles as Fall Guys: Ultimate Knockout, Ori and The Will of the Wisps, Oddworld: Soulstorm and Township were created on the Unity engine.

Also on the topic:

• Epic Games has attracted $1.78 billion in investmentsUnity will appear on the stock exchange on September 18 and will attract $ 1.2 billion
• Unity has introduced the cloud content distribution service Cloud Content Delivery
• Is there any news?