Unity's Q2 revenue falls 16%, down to $449 million

Unity has announced its Q2 2024 financial performance, revealing a drop in revenue that was still better than their earlier forecast of $420 million to $425 million for the second quarter.

Additionally, the company has disclosed that CFO Luis Visoso, who came aboard in 2021, will be stepping down. Mark Barrysmith, the current chief accounting officer, will serve as interim CFO, and two other executives are also joining the leadership team.

Financial Performance

• Total revenue: $449 million (a 16% decrease year-over-year)
• Create Solutions revenue: $129 million (a 4% increase)
• Grow Solutions revenue: $296 million (a 9% decrease)
• Net loss: $126 million (improved from $193 million for the same period last year)

Key Insights

Create Solutions emerged as the primary revenue stream for Unity this quarter, mainly driven by a 14% rise in game subscriptions and an 18% contribution from various industries.

The industrial sector showed remarkable growth, increasing 59% over the previous year, making it Unity's most rapidly expanding segment.

Although Growth Solutions saw a slight fall, it returned to sequential growth after two declining quarters, attributed to product enhancements and seasonal factors, according to Visoso.

CEO Matthew Bromberg highlighted the acquisition of two new non-gaming clients, Audi and beverage mogul Diaego, under this segment.

In the future, Unity aims to earn $415 million to $420 million in revenue for Q3, indicating a potential yearly decline of up to 6%.

The company's guidance for the entire year has been adjusted to a range between $1.68 billion and $1.69 billion, down from the previous forecast of $1.76 billion to $1.8 billion, representing a decrease of up to 3%.

"Despite the positive effects of our ad network and level-play product enhancements, we anticipate it will take more time to realize their full impact on revenue," stated Visoso.

In other updates, Unity has recruited Jim Payne as Chief Product Officer for advertising. Payne is the co-founder of MoPub, a mobile ad server acquired by AppLovin from Twitter for $1 billion in 2021.

Additionally, Alex Blum has joined as Senior Vice President of corporate development, bringing his experience as an investor and advisor, most recently with the phone call captioning app Nagish.