Unity Software Inc (NYSE:U) stock tanked Thursday after the company reported its fourth-quarter financial results. The company’s 3D development platform helps create games and apps.
What Happened: Unity’s fourth-quarter revenue decreased 25% year-over-year to $457.1 million, which beat the consensus estimate of $433.17 million.
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The company reported a quarterly loss of 30 cents per share, which beat analyst estimates for a loss of 37 cents per share.
Create Solutions revenue came in at $152 million, down 47% on a year-over-year basis. Excluding the impact of $99 million of incremental revenue in the fourth quarter of 2023 from terminating an agreement with Wētā FX, revenue would have been down 20%.
Grow Solutions revenue totaled $305 million, down 5% year-over-year. Excluding the impact of the return of customer incentives issued by ironSource before the merger, Grow Solutions’ revenue would have increased by 2%.
Cash provided by operations was $112.19 million in the quarter and free cash flow totaled $105.75 million.
Outlook: Unity expects first-quarter revenue in a range of $405 million to $415 million versus the consensus estimate of $439.54 million.
Unity Software stock plunged 33% in the last 12 months as it missed the EPS consensus estimates in at least four of the previous eight quarters.
U Price Action: U stock is trading 16% higher Thursday morning at $24.91.
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