Unity Software Inc U shares are trading higher Thursday after the company reported a top-line beat and issued strong guidance. Multiple analysts are out with updates following the print.
What Happened: Unity said first-quarter revenue increased 56% year-over-year to $500 million, which beat average analyst estimates of $480.9 million, according to Benzinga Pro.
The company reported a GAAP net loss of $254 million. Adjusted EBITDA came in at $32 million, which was ahead of provided guidance of $7 million to $12 million.
"For the balance of 2023, we expect revenue to grow faster than the markets in which we compete, with steady and meaningful continued progress on profitability," the company said in a letter to shareholders.
Unity sees second-quarter revenue in a range of $510 million to $520 million, versus estimates of $508.46 million. The company expects full-year revenue to be between $2.08 billion and $2.2 billion, versus estimates of $2.13 billion.
Unity also highlighted the decision to cut 8% of its workforce, reduce managerial layers to become more effective and trim the total number of Unity offices over time to concentrate people and teams together.
Analyst Assessment:
- Piper Sandler analyst Brent Bracelin reiterated Unity with an Overweight and maintained a $43 price target.
- Barclays analyst Mario Lu maintained Unity with an Equal-Weight and lowered the price target from $32 to $31.
- Needham analyst Bernie McTernan reiterated Unity with a Buy and maintained a $44 price target.
- Credit Suisse analyst Stephen Ju maintained Unity with an Outperform and lowered the price target from $67 to $66.
- Morgan Stanley analyst Matthew Cost maintained Unity with an Equal-Weight and raised the price target from $27.50 to $28.
U Price Action: Unity shares were up 8.91% at $31.30 at the time of publication, per Benzinga Pro.
Photo: Joshua Woroniecki from Pixabay.
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