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Unity’s revenue in 2023 grew by 57% to $2.1 billion thanks to mass layoffs

Unity released financial results for the fourth quarter and full year 2023, showing revenue growth and a reduction in net losses in both quarterly and annual reports.

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Despite these performances, the company’s shares fell 17%, as reported by CNBC .

 

Q4 2023

 

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  • Revenue: $609 million (35% year-on-year growth)

 

  • Net loss: $254 million (versus $288 million last year)

 

  • Revenue from Create Solutions: $290 million (up 47% year-on-year)

 

  • Revenue from Grow Solutions: $319 million (up 26% year-on-year)

 

FY 2023

 

  • Revenue: $2.1 billion (up 57%)

 

  • Net loss: $826.3 million (down 10%)

 

As stated in its Q4 2023 report, Unity attributes the revenue growth to the termination of its services contract with visual effects studio Weta last November as part of a “company reset” that resulted in the elimination of 265 jobs.

 

The termination of this agreement increased revenue by $99 million and net loss by $27 million, although the company’s overall net loss still decreased to $826.3 million. Unity reported that without this deal, revenue would have been $510 million (down 2% year over year). by year).

 

The company noted that the Create Solutions division (responsible for the Unity engine) benefited from the decision. If not for the Weta deal, revenue would have been $190 million (down 4% year-on-year).

 

The decline resulted from the impact of the company’s reboot on businesses such as professional services, gaming services and Weta Tools.

 

The Industries segment, which deals with non-gaming industries such as retail and auto, represented 23% of subscriptions, up from 20% in the last quarter and 19% in Q4 last year.

 

Despite year-on-year revenue growth of 26% in its Grow Solutions segment (advertising, products and services for Unity), the company noted that its performance was impacted by the controversial September launch fee proposal.

 

Unity’s revenue expectations for the full year range from $1.76 billion to $1.8 billion, representing a decline of 2% to 4% year over year.

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