Unity Software Inc fell 14% in after-hours trading on Wednesday after reporting a $253.7 million Q3 loss, compared to only $155.1 million the prior year.
Although the software company posted higher revenue for Q3 at $322.88 million compared to $286.33 million a year ago, it still fell short by 0.14% against the consensus estimate.
This year alone, Unity’s stocks fell 85% compared to the 34% and 21% decline of the tech-heavy Nasdaq Composite Index and the S&P 500 index.
Despite this, the San Francisco-based software developer forecasts higher Q4 earnings of around $425 to $445 million and expects an average full-year revenue of about $1.365 to $1.385 billion, against the consensus estimate of $384.82 million Q4 earnings and $1.35 billion full-year revenue.
According to Unity’s CFO, Luis Visoso, “The third quarter came in line with guidance for revenue and non-GAAP operating income, and we are taking a prudent approach in the fourth quarter, given the current macroeconomic environment.”
“We have carefully managed costs this year, and will drive more efficiencies next year, as we continue to capture the large opportunity in front of us,” Visoso added.
Unity Software Merges with ironSource
On Monday, before the release of Unity’s Q3 earning report, the company completed a $4.4 billion merger deal with the Israeli adtech company ironSource.
The deal was first announced in July, and ironSource shareholders were due to receive 0.1089 Unity shares per one ironSource share they own. In addition, ironSource CEO Tomer Bar-Zeev will be a part of the merged company’s board.
In Unity’s Q3 financial report, Unity CEO John Riccitiello greets ironSource by saying, “We welcome everyone at ironSource to Unity as we build a transformational end-to-end platform that will create value for Creators and our shareholders. We believe that the combination positions us for success in today’s challenging ad market and for when markets begin their rebound.”
This deal gives Unity access to ironSources leading technologies, which is expected to boost the growth of Unity’s monetization division.
