Unity reports first quarter results above guidance, exits ad businesses

Unity Technologies (NYSE: U) reported preliminary first quarter 2026 revenue of $505 million to $508 million, exceeding its guidance range of $480 million to $490 million. The game engine company also posted adjusted EBITDA of $130 million to $135 million, surpassing guidance of $105 million to $110 million and representing 58% year-over-year growth.

The company attributed the performance to Unity Vector, which increased 15% sequentially in the first quarter, and stronger than expected results from its Create division. Unity expects Grow revenue of approximately $352 million and Create revenue of approximately $155 million for the quarter.

Unity announced it will shut down the ironSource Ads Network effective April 30 and has engaged a financial advisor to assist with divesting its Supersonic game publishing business. The company stated these changes are expected to result in faster revenue growth, increased adjusted EBITDA, and higher adjusted EBITDA margins.

Strategic Grow revenue, which excludes contributions from ironSource Ads Network and Supersonic, is expected to increase 48% year-over-year in the first quarter. This compares to 24% year-over-year growth expected for total Grow revenue. Strategic Create revenue is projected to grow 14% year-over-year.

"Unity Vector continues to deliver robust growth each quarter, driving results meaningfully above our guidance," said Matt Bromberg, president and CEO of Unity. "Today's actions will accelerate Vector's impact on our business, enhancing both revenue growth and profitability."

Unity expects minimal revenue contribution from the ironSource Ads Network after the first quarter of 2026. The preliminary results remain subject to completion of quarter-end financial closing procedures and have not been reviewed by the company's independent auditors.

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