Why Unity Software Stock Is Up Tuesday

Unity Software Inc U shares are trading higher Tuesday after the company announced a CEO transition.

What Happened: Late Monday, Unity announced that John Riccitiello will retire as chairman, president and CEO, effective immediately. 

"It's been a privilege to lead Unity for nearly a decade and serve our employees, customers, developers and partners, all of whom have been instrumental to the Company's growth," Riccitiello said.

"I look forward to supporting Unity through this transition and following the Company's future success."

Riccitiello will continue to work in an advisory role to help ensure a smooth transition. James Whitehurst has been appointed as interim president and CEO and Roelof Botha has been named chairman. The board also said it will launch a search process to name a permanent CEO.

The news came after Unity faced backlash over changes to its Runtime Fee policy. The company walked back the policy changes after it received pushback from its community of creators.

"We have heard your concerns, and we are making changes in the policy we announced to address them," the company said in a blog post at the time.

Unity also reaffirmed its previously announced third-quarter guidance on Monday. The company is set to report third-quarter financial results after the market close on Nov. 9. Analysts are anticipating earnings of 9 cents per share and revenue of $554.84 million, according to estimates from Benzinga Pro.

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U Price Action: Unity shares initially traded lower on the news before bouncing back. The stock was up 4.18% at $30.94 at the time of publication, according to Benzinga Pro.

Photo: THAM YUAN YUAN from Pixabay.