Unity Software program (U) This autumn 2020 outcomes

John Riccitiello, CEO of Unity, speaks on stage on day one of TechCrunch Disrupt SF 2018 at the Moscone Center on September 5, 2018 in San Francisco, California.

Steve Jennings | TechCrunch | Getty Images

Unity Software shares fell as much as 16% in extended trading Thursday after the video game engine developer released a forecast that fell short of analysts’ most optimistic estimates

This is how the company developed in the fourth quarter:

  • Merits: Refinitiv indicates a loss of 10 per share, adjusted against a loss of 14 cents per share, as analysts expected.
  • Revenue: According to Refinitiv, $ 220.3 million versus $ 204.23 as analysts expected.

Revenue rose by 39% year-on-year compared to 53% in the previous quarter.

While fourth quarter results beat estimates, the company’s forecast was disappointing for investors who chose to rally in stocks. Since going public in September at $ 52 per share, Unity’s value has nearly tripled to $ 149.81 at Thursday’s close.

Unity expects first quarter revenue of $ 210 million to $ 220 million, an annualized growth of 29%. In the middle of the range, the forecast is roughly in line with the consensus of $ 214.7 million among analysts surveyed by Refinitiv.

For the full year 2021, Unity announced revenues of $ 950 million to $ 970 million. The middle of this range, $ 960 million, would represent growth of 24% and is just above the average analyst estimate of $ 956.1 million.

The company said in the statement: “Our goal is to build a company that will generate sales growth of around 30% over the long term.”

Unity expects user engagement, including the increase in the number of people consuming content created with its software, to continue into 2021 even as the coronavirus pandemic recedes, the company’s chief financial officer Kim Jabal said during a conference call with analysts.

At the same time, Unity expects it will have a short-term impact after Apple rolls out a privacy change expected in the spring, Jabal said, which will result in a 3% drop in sales for all of 2021. Advertising is the largest portion of Unity’s Operate Solutions segment, which provides 61% of sales, Jabal said.

“We’ve been working honestly on it for years,” she said.

Unity has hired Marc Whitten, a vice president of Amazon and former Microsoft executive, to lead the Create Solutions game development business, Unity CEO John Riccitiello said on the conference call.

Last quarter, Unity acquired RestAR, a company whose artificial intelligence software helps brands create 3D product renders using mobile devices. The company also announced a deal with Snap to try to make Unity advertising inventory in apps and games available to businesses that advertise Snap.

Excluding the after-business move, Unity stocks have fallen 3% so far this year, while the S&P 500 index has risen about 3% over the same period.

Nominations are open to the 2021 CNBC Disruptor 50, a list of private startups that are leveraging breakthrough technology to become the next generation of large publicly traded companies. Post through Friday, February 12th at 3 p.m. EST.

CLOCK: Jim Cramer cancels Unity Software’s initial public offering and debut

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