Unity Software Inc (U)
NYSEInformation TechnologySoftware - ApplicationSnapshot 2026-09-09
$42.54-0.49%
Close 2026-09-09 · 1-day change
NYSEInformation TechnologySoftware - ApplicationSnapshot 2026-09-09
Intact: The reason to own it still holds.
Unity grows revenue to about $510 million in Q2 2026. Profit beats with adjusted EBITDA near $132 million. Cash flow from operations improves to support growth. Partnerships and AI tools help expand their business.
Unity still loses money and missed earnings recently. Key leaders are leaving. Cash flow dropped from $121 million to $71 million. These risks could slow growth and hurt profits.
The price is about 7% above our fair value near $27. Analysts expect 17% revenue growth. Our fair value is 21% below the Street median, so weigh the Street range.
Breaks if: Adjusted EBITDA falls below $130M or above $135M in Q2 2026
Unity targets Adjusted EBITDA between $130 million and $135 million for Q2 2026.
This is not a price target or investment advice.
A long-form read on the 1–3 year hold thesis. It updates when the weekly evidence changes.
This investment represents a speculative growth opportunity. The current thesis is cautious, as the company is loss-making but shows signs of strategic revenue growth, particularly in Unity Vector AI.
The market seems to price in a premium compared to peers, indicating expectations of future growth. However, the valuation appears unjustified given the company's recent weak performance and elevated risks.
Management is on track with priorities such as growing strategic revenue and improving cash flow. However, the recent financial performance has been weak, and there is a notable risk of missing future earnings expectations.
The thesis hinges on management's ability to maintain revenue growth and margin expansion while navigating potential negative guidance cuts. Additionally, external factors like Fed rate cuts and performance from sector leaders could influence U's trajectory.
The most important moves since the prior daily snapshot.
Mixed, the news cuts both ways. The latest earnings beat supports a positive outlook. However, concerns arose as the CEO sold shares, which may indicate a lack of confidence.
as of 2026-09-09
Review the evidence to watch, what would become a concern, and what would make it less concerning.
Not investment advice. Scores describe historical and current data; they are not forecasts of future returns. Consult a licensed advisor before making investment decisions.
Breaks if: Cash from operations falls below $70M in Q1 2026
Breaks if: Revenue falls below $505M or above $515M in Q2 2026
Unity aims to achieve revenue between $505 million and $515 million for Q2 2026.
The outlook for U over the next 1 to 3 years is mixed, with growth potential tempered by recent weaknesses and market risks. Not investment advice.