Unity's revenue for the second quarter declines by 2%, reaching $441 million
Image credit: Unity
Unity has revealed its financial outcomes for the second quarter, noting minor declines in both its total earnings and the Grow Solutions segment.
The company reported a 4% enhancement in revenue within its Create Solutions division, largely credited to the ongoing success of Unity 6, its emerging AI platform, Unity Vector, and a 15% increase in its Unity Ad Network.
Key financial details include:
Financial Overview
- Total Revenue: $441 million, reflecting a 2% dip from the previous year
- Create Solutions Revenue: $154 million, a 2% increase from last year
- Grow Solutions Revenue: $287 million, a decrease of 4% year-on-year
- Net Loss: $107 million, with a 24% margin
Despite the overall 2% drop in revenue to $441 million, Unity's CEO and president Matt Bromberg stated that the results exceeded expectations and surpassed the higher end of their projected revenue and adjusted EBITDA.
During a conference call reported by Seeking Alpha, Bromberg pointed out Unity's focus on enhancing quality, stability, and the developer experience as factors driving favorable financial outcomes in Create Solutions. The 2% revenue growth here was mainly due to a significant $12 million term license sale.
This segment also experienced an uptick in subscription revenue, with Unity 6 downloads surpassing 6.6 million, a 50% rise compared to the same timeframe last year.
Bromberg emphasized "major multiyear partnerships" formed this quarter with companies like Tencent and Scopely, as well as a comprehensive partnership with Nintendo to ensure Unity 6's optimization for the Switch 2 release.
"Our goal with these partnerships is to develop new business avenues for our partners using our platform and product portfolio," Bromberg stated, rather than merely increasing seat sales.
Although the Grow Solutions segment's Unity Ad Network grew 15% from the previous quarter, this was balanced by a dip in other advertising products. Unity Vector, the new AI platform, plays a notable role in this division's revenue.
Looking towards the next quarter, Unity anticipates revenue between $440 million and $450 million. For Grow Solutions, it projects "mid-single digit sequential revenue growth" from Q2 to Q3. However, Create Solutions may see a slight sequential decline because of a substantial client acquisition in Q2.