Unity revenue rises 57% to $2.1 billion in 2023
Engine provider's full-year net loss narrows to $826.3 million
Unity released its fourth quarter full-year financial earnings for 2023 yesterday, which saw a jump in revenue and decrease in net losses both in its Q4 and FY 2023 results.
Despite these results, shares dropped 17% as reported by CNBC.
The numbers:
Q4 2023
- Revenue: $609 million (up 35% year-on-year)
- Net loss: $254 million (compared to $288 million last year)
- Create Solutions revenue: $290 million (up 47% year-on-year)
- Grow Solutions revenue: $319 million (up 26% year-on-year)
FY 2023
- Revenue: $2.1 billion (up 57%)
- Net loss: $826.3 million (down 10%)
The highlights:
As detailed in its Q4 2023 report, Unity cited the increase in revenue due to the termination of its service agreement with VFX studio Weta, which occurred last November as part of a "company reset" which resulted in the loss of 265 jobs.
The end of this agreement resulted in $99 million of incremental revenue and increased its net loss by $27 million, although the company's net loss decreased overall to $826.3 million. Unity said that if this transaction didn't occur, its revenue would have been $510 million (down 2% year-on-year).
Unity reported that its Create Solutions vertical (the division in charge of Unity's engine) benefited from this decision, as if not for the end of its transaction with Weta revenue would have been $190 million (down 4% year-on-year).
This decline was a result of businesses impacted by Unity's company reset, including professional services, gaming services, and Weta Tools.
The Industries segment, which handles partnerships with non-games sectors such as retail and automotive, represented 23% of core subscriptions compared to 20% last quarter and 19% in Q4 the previous year.
Despite revenue being up 26% year-on-year in its Grow Solutions segment (Unity's ads and products and services), Unity said its performance was impacted by its controversial runtime fee proposal announced last September.
Looking ahead, Unity forecasted revenue for FY 2023 will generate revenue of $1.76 billion to $1.8 billion, a 2% to 4% decline year-on-year.