Unity Technologies reported strong financial performance in Q2 2024, with revenue just shy of $450 million, surpassing both guidance and analyst expectations. However, this figure marked a slight 2% decrease from the previous quarter’s revenue of $460 million.
Despite the drop in revenue, Unity managed to significantly reduce its net losses to $126 million, down from $291 million in Q1. The company attributed most of its expenses to restructuring and reorganization costs, which have been part of its broader strategy to streamline operations.
One of the most notable outcomes of Unity’s cost-cutting measures was a substantial improvement in its EBITDA, which jumped by 45% to $113 million in Q2, compared to $79 million in Q1. This reflects the company’s efforts to enhance its operational efficiency despite the ongoing challenges in the market.
However, Unity’s revenue for Q2 2024 was down 16% compared to Q2 2023, when the company reported $533 million. Nonetheless, the company managed to reduce its net losses by 35% year-over-year and achieved a 15% growth in EBITDA.
Despite these improvements, Unity has adjusted its full-year guidance for 2024, reducing its revenue expectations to a range of $1,680 to $1,690 million, representing a 2-3% year-on-year decrease.
The company also lowered its revenue forecast for Q3 2024 by 4-6%, signaling caution in the face of ongoing market uncertainties. These adjustments indicate that while Unity is making strides in cost management, it remains cautious about its growth prospects for the remainder of the year.
Unity’s strong market position was also highlighted in the report, with the company revealing that 60% of the $130 billion annual consumer app spending comes from games, and 70% of the top mobile games worldwide are built using Unity. In 2023, applications made with Unity were downloaded 3.7 billion times per month.
Unity’s advertising business continues to perform robustly, delivering over 65 billion impressions monthly and reaching 1.5 billion gamers globally. Unity CEO Matthew Bromberg emphasized a renewed focus on execution, innovation, and customer engagement in his letter to shareholders.
The earnings report also marked significant changes in Unity’s leadership. This was the first report under the leadership of new CEO Matthew Bromberg, who took over in May following the departure of John Riccitiello after a controversial pricing change.
The company announced additional leadership changes, including the appointment of Jim Payne as Chief Product Officer for advertising and Alex Blum as SVP of corporate development. However, Unity also saw the departure of its CFO, Luis Visoso, who had been with the company for three years.
The company is preparing to launch Unity 6, the latest version of its platform, in the fall, while continuing to explore non-gaming applications through partnerships with companies like Diageo, Audi, Rady Children’s Hospital, and Bosch Rexroth.
