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Unity (NYSE: U) lifts Q2 2026 revenue 24% and boosts cash flow

Filing Impact
(High)
Filing Sentiment
(Neutral)
Form Type
8-K

Rhea-AI Filing Summary

Unity Software Inc. reported Q2 2026 revenue of $546 million, up 24% year-over-year, led by strategic revenue of $486 million, up 38%. Create Solutions revenue was $158 million, while Grow Solutions revenue reached $389 million, supported by the Unity Vector advertising platform.

GAAP net loss narrowed to $23 million (margin -4%, EPS -$0.05) from $107 million, while adjusted EBITDA rose to $160 million with a 29% margin. Free cash flow was $202 million, and cash, cash equivalents and restricted cash totaled $2,357 million as of June 30, 2026. For Q3 2026, Unity guides to strategic revenue of $540–$550 million and adjusted EBITDA of $185–$190 million, and states an expectation to become GAAP profitable by the third quarter of 2026.

Positive

  • Revenue growth accelerated: Q2 2026 revenue reached $546 million, up 24% year-over-year, with strategic revenue up 38% and Grow Solutions revenue up 35%.
  • Profitability metrics improved: Adjusted EBITDA increased to $160 million (29% margin) from $90 million (21% margin), and adjusted EPS rose to $0.28 from $0.18.
  • Stronger cash generation: Free cash flow was $202 million versus $127 million a year earlier, and cash, cash equivalents and restricted cash stood at $2,357 million.

Negative

  • Unity remains GAAP unprofitable: Q2 2026 GAAP net loss was $23 million (EPS -$0.05), and accumulated deficit totaled $4,509.9 million.

Filing Explained

Supersonic is sold, but Unity’s planned November 2026 note repayment is incomplete and Q2 stock issuance reduces existing holders’ ownership percentages.

As a Form 8-K, this filing reports Unity’s second-quarter results and other specified material events; the Supersonic publishing business was sold on August 4, 2026, and Q2 cash flow reports $4,551 thousand from common-stock issuance through option exercises and ESPP purchases.

The completed sale ends Supersonic’s inclusion in Unity’s business after August 4, 2026, while the reported stock issuance increases the share count and reduces an existing holder’s percentage ownership absent offsetting changes.

The balance sheet reports 439,987 thousand issued and outstanding shares at June 30, 2026, versus 432,860 thousand at December 31, 2025.

Unity also says it plans to repay its 2021 convertible notes in November 2026; the balance sheet lists $557,173 thousand as the current portion and $1,680,229 thousand as long-term convertible notes, so that repayment is not completed in this filing.

The filing does not disclose consideration for the Supersonic sale, so its economics cannot be assessed here; a November 2026 debt disclosure would show whether the stated note-repayment plan was completed.

Item 2.02 Results of Operations and Financial Condition Financial
Disclosure of earnings results, typically an earnings press release or preliminary financials.
Item 9.01 Financial Statements and Exhibits Exhibits
Financial statements, pro forma financial information, and exhibit attachments filed with this report.
Total Revenue $546 million Revenue in the second quarter of 2026; compared to $441 million in Q2 2025.
Strategic Revenue $486 million Strategic revenue in Q2 2026; up 38% year-over-year.
GAAP Net Loss $23 million GAAP net loss in Q2 2026; margin (4)% and basic and diluted EPS of $(0.05).
Adjusted EBITDA $160 million Adjusted EBITDA in Q2 2026 with a 29% margin, versus $90 million and 21% in Q2 2025.
Free Cash Flow $202 million Free cash flow in Q2 2026; compared to $127 million in the second quarter of 2025.
Cash and Equivalents $2,357 million Cash, cash equivalents and restricted cash as of June 30, 2026.
Q3 2026 Adjusted EBITDA Guidance $185–$190 million Guidance range for adjusted EBITDA in the third quarter of 2026; expected 69%–74% year-over-year growth.
non-GAAP financial measures financial
"we use certain non-GAAP financial measures, as described below, to evaluate our ongoing operations"
Non-GAAP financial measures are numbers companies use to show their financial performance that exclude certain expenses or income. They help investors see how the company might perform without one-time costs or other unusual items, giving a different perspective from official reports. However, since they can be adjusted, they don’t always tell the full story and should be looked at alongside standard financial figures.
Adjusted EBITDA financial
"We define adjusted EBITDA as GAAP net income or loss excluding benefits or expenses"
Adjusted EBITDA is a way companies measure how much money they make from their core operations, like running a business, by removing certain costs or income that aren’t part of regular business activities. It helps investors see how well a company is doing without distractions from unusual expenses or gains, making it easier to compare companies or track performance over time.
free cash flow financial
"We define free cash flow as net cash provided by operating activities less cash used for purchases"
Free cash flow is the amount of money a company has left over after paying all its expenses and investing in its business, like buying equipment or updating facilities. It shows how much cash is available to reward shareholders, pay down debt, or save for future growth. This helps investors understand if a company is financially healthy and able to grow.
convertible notes financial
"Current portion of convertible notes | 557,173 | ... Convertible notes | 1,680,229"
Convertible notes are a type of short-term loan that a company receives from investors, which can later be turned into company shares instead of being paid back in cash. They matter to investors because they offer a way to support a company early on while giving the potential to own a stake in its success if the company grows and later raises more funding.
redeemable noncontrolling interests financial
"Redeemable noncontrolling interests | 266,727 | | 252,637"
A redeemable noncontrolling interest is a minority ownership stake in a company that the holder can force the company to buy back at a set price or under certain conditions. For investors this matters because it creates a future cash obligation and can be treated more like a liability than permanent equity, affecting a company’s reported debt, net income and valuation — think of it as a part-owner who can cash out, forcing the business to pay them.
Revenue $546 million up 24% year-over-year from $441 million in Q2 2025.
GAAP Net Loss $23 million narrowed from $107 million in the second quarter of 2025.
Adjusted EBITDA $160 million up from $90 million, with margin rising to 29% from 21% year-over-year.
Free Cash Flow $202 million increased from $127 million in the second quarter of 2025.
Adjusted EPS $0.28 rose from $0.18 in the second quarter of 2025.
Guidance

For Q3 2026, Unity guides to strategic revenue of $540–$550 million, non-strategic revenue of $20 million, and adjusted EBITDA of $185–$190 million.

AI-generated analysis. How Rhea-AI works. Not financial advice.

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FAQ

What were Unity (U) total and segment revenues in Q2 2026?
Unity reported $546 million in Q2 2026 revenue. Create Solutions revenue was $158 million, Grow Solutions revenue was $389 million, strategic revenue totaled $486 million, and non-strategic revenue contributed $60 million for the quarter.

Did Unity (U) improve profitability in Q2 2026?
Unity’s GAAP net loss narrowed to $23 million (EPS -$0.05) from $107 million. Adjusted EBITDA rose to $160 million with a 29% margin, and free cash flow increased to $202 million, reflecting higher revenue and cost control.

What financial guidance did Unity (U) provide for Q3 2026?
For Q3 2026, Unity guides to strategic revenue of $540–$550 million and non-strategic revenue of $20 million. It expects adjusted EBITDA of $185–$190 million, implying 69%–74% year-over-year growth in this profitability metric.

How strong was Unity’s (U) cash position as of June 30, 2026?
As of June 30, 2026, Unity held $2,357 million in cash, cash equivalents and restricted cash. Net cash provided by operating activities was $206 million in Q2, and free cash flow was $202 million, indicating substantial liquidity supported by operations.

What drove Unity’s (U) revenue growth in Q2 2026?
Q2 2026 revenue growth was led by Grow Solutions at $389 million, helped by the Unity Vector advertising platform, and by higher Create subscription revenue. Strategic revenue rose 38%, while non-strategic revenue declined as Unity exited certain ad network and publishing businesses.

Which non-GAAP metrics did Unity (U) highlight for Q2 2026?
Unity emphasized adjusted EBITDA of $160 million with a 29% margin, adjusted gross margin of 83%, free cash flow of $202 million, and adjusted EPS of $0.28. These non-GAAP measures exclude stock-based compensation, amortization, restructuring and certain other items.
FALSE000181080600018108062026-08-062026-08-06

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): August 6, 2026
UNITY SOFTWARE INC.
(Exact name of registrant as specified in its charter)
Delaware001-3949727-0334803
(State or other jurisdiction
of incorporation)		(Commission File Number)(I.R.S. Employer
Identification No.)
116 New Montgomery Street
San Francisco, California 94105-3607
(Address, including zip code, of principal executive offices)
(415) 638-9950
(Registrant's telephone number, including area code)
Not applicable
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
☐
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
☐
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
☐
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Securities registered pursuant to Section 12(b) of the Act:
Title of each classTrading Symbol(s)Name of each exchange on which registered
Common stock, $0.000005 par valueUThe New York Stock Exchange
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐


Item 2.02    Results of Operations and Financial Condition.
On August 6, 2026, Unity Software Inc. (“Unity” or the “Company”) issued a press release announcing its financial results for the quarter ended June 30, 2026. A copy of the press release is attached as Exhibit 99.1 to this Current Report on Form 8-K and is incorporated herein by reference. The Company also posted supplemental material dated August 6, 2026, on the Investor Relations page of its website at investors.unity.com.
The information in this Item 2.02 of this Current Report on Form 8-K and the exhibit attached hereto as 99.1 shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Exchange Act, regardless of any general incorporation language in such filing, except as shall be expressly set forth by specific reference in such filing.
Item 9.01    Financial Statements and Exhibits.
(d) Exhibits.
Exhibit Number
Description of Exhibit
99.1
Press Release dated August 6, 2026 of Unity Software Inc.
104Cover Page Interactive Data File (embedded within the Inline XBRL document)


SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
UNITY SOFTWARE INC.
Date: August 6, 2026
By:/s/ Jarrod Yahes
Jarrod Yahes
Senior Vice President, Chief Financial Officer
(Principal Financial Officer)


Exhibit 99.1
unitylogoa.jpg
Unity Reports Second Quarter 2026 Financial Results
SAN FRANCISCO, August 6, 2026 -- Unity (NYSE: U), the world’s leading game engine, today announced financial results for the second quarter ended June 30, 2026.
“This was arguably the best quarter in Unity’s history as a public company,” said Matt Bromberg, President & CEO of Unity. “The ongoing success of Unity Vector AI, combined with the most exciting product roadmap in Unity’s history, is helping drive substantial value for creators, players, and shareholders.”
Select revenue highlights for Q2 2026 are as follows (in thousands):
Three Months Ended June 30,
20262025
YoY Change
Strategic Grow Revenue$328,955$201,33463%
Strategic Create Revenue$157,456$150,6055%1
Total Strategic Revenue$486,411$351,93938%
Non-Strategic Revenue2$60,057$89,005(33)%
Total Revenue$546,468$440,94424%
Q3 2026 Guidance3
•Strategic Revenue of $540 million to $550 million, up 44% - 47% year-over-year
◦Strategic Grow Revenue of $380 million to $385 million, up 68% - 70% year-over-year
◦Strategic Create Revenue of $159 million to $163 million up 7% - 10% year-over-year
•Non-Strategic Revenue of $20 million
◦Incorporates approximately one month of revenue from the Supersonic business, which was sold on August 4, 2026
•Adjusted EBITDA of $185 million to $190 million, up 69% - 74% year-over-year
1 YoY Change was 14% when excluding the impact of a $12 million one-time revenue item in the second quarter of 2025.
2 Consists primarily of revenue from (i) our ironSource Ads network, which was sunset effective April 30, 2026, and (ii) our Supersonic publishing business which was sold on August 4, 2026.
3 These statements are forward-looking and actual results may differ materially. Refer to the “Forward-Looking Statements” safe harbor section below for information on the factors that could cause our actual results to differ materially from these forward-looking statements. We have not reconciled our estimates for non-GAAP financial measures in this press release and in the earnings call referencing this press release to GAAP due to the uncertainty and potential variability of expenses that may be incurred in the future. As a result, a reconciliation is not available without unreasonable effort and we are unable to address the probable significance of the unavailable information. We have provided a reconciliation of other GAAP to non-GAAP financial measures in the financial statement tables for our second quarter non-GAAP results included in this press release.
© 2026 Unity Technologies
U N I T Y . C O M|
1

Earnings Webcast
Unity will hold a public webcast at 8:30 a.m. ET today to discuss the results for its second quarter 2026. The live public webcast can be accessed on Unity’s Investor Relations website at https://investors.unity.com. The webcast replay will also be available on the site.
Second Quarter 2026 Results:
Total Revenue Highlights:
•Revenue was $546 million, compared to $441 million in the second quarter 2025.
•Create Solutions revenue was $158 million, compared to $154 million in the second quarter 2025.
•Grow Solutions revenue was $389 million, compared to $287 million in the second quarter 2025.
Profitability Highlights:
•GAAP net loss was $23 million, with a margin of (4)%; GAAP basic and diluted net loss per share was $0.05.
•Adjusted EBITDA was $160 million, with a margin of 29%; adjusted EPS was $0.28.
•Net cash provided by operating activities was $206 million; free cash flow was $202 million.
Revenue
Revenue was $546 million, up 24% year-over-year. Strategic revenue was $486 million, up 38% year-over-year.
Create Solutions revenue was $158 million, up 2% year-over-year. The increase was driven by increases in subscription revenue, partially offset by decreases in cloud and hosting services revenue, driven by our portfolio reset in 2025.
Grow Solutions revenue was $389 million, up 35% year-over-year. The change was due to growth in the Unity Ads Network, driven by “Unity Vector”, partially offset by decreases in the ironSource Ads Network.
Basic and Diluted Net Loss per share
Basic and diluted net loss per share was $0.05, as compared to $0.26 for the same period in 2025.
Net Loss and Net Cash Provided by Operating Activities
Net Loss for the quarter was $23 million, compared to a net loss of $107 million in the second quarter of 2025.
Net Loss margin was (4)%, compared to (24)% in the second quarter of 2025.
Net cash provided by operating activities for the quarter was $206 million, compared to $133 million in the second quarter of 2025.
Adjusted EBITDA, Free Cash Flow, and Adjusted EPS
Adjusted EBITDA for the quarter was $160 million, with a margin of 29%, compared to $90 million in the second quarter of 2025, with a margin of 21%. The year-over-year improvement was driven by higher revenue and continued cost control.
Free cash flow for the quarter was $202 million, compared to $127 million in the second quarter of 2025.
Adjusted EPS for the quarter was $0.28, compared to $0.18 in the second quarter of 2025.
© 2026 Unity Technologies
U N I T Y . C O M|
2

Liquidity
As of June 30, 2026, our cash and cash equivalents, and restricted cash was $2,357 million, and increased by $293 million, as compared with $2,064 million as of December 31, 2025. This increase was primarily driven by our operations.
About Unity
Unity [NYSE: U] offers a suite of tools to develop, deploy, and grow games and interactive experiences across all major platforms from mobile, PC, and console, to extended reality. For more information, visit Unity.com.
© 2026 Unity Technologies
U N I T Y . C O M|
3

UNITY SOFTWARE INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands, except per share data)
(Unaudited)
As of
June 30, 2026December 31, 2025
Assets
Current assets:
Cash and cash equivalents$2,351,987 $2,055,840 
Accounts receivable, net688,739 643,611 
Prepaid expenses and other83,590 113,012 
Assets held-for-sale
56,030 — 
Total current assets3,180,346 2,812,463 
Property and equipment, net49,814 68,289 
Goodwill3,155,607 3,166,304 
Intangible assets, net163,141 650,544 
Other assets112,354 140,006 
Total assets$6,661,262 $6,837,606 
Liabilities and stockholders' equity
Current liabilities:
Accounts payable$10,429 $13,981 
Accrued expenses and other304,134 299,541 
Publisher payables440,665 431,494 
Deferred revenue237,348 224,405 
Current portion of convertible notes557,173 556,451 
Liabilities held-for-sale
19,946 — 
Total current liabilities1,569,695 1,525,872 
Convertible notes1,680,229 1,678,899 
Long-term deferred revenue20,278 14,038 
Other long-term liabilities84,167 122,660 
Total liabilities3,354,369 3,341,469 
Commitments and contingencies
Redeemable noncontrolling interests266,727 252,637 
Stockholders' equity:
Common stock, $0.000005 par value:
Authorized shares - 1,000,000 and 1,000,000
Issued and outstanding shares - 439,987 and 432,860
2 2 
Additional paid-in capital7,540,533 7,378,295 
Accumulated other comprehensive income (loss)3,280 (2,156)
Accumulated deficit(4,509,925)(4,138,709)
Total Unity Software Inc. stockholders' equity3,033,890 3,237,432 
Noncontrolling interest6,276 6,068 
Total stockholders' equity3,040,166 3,243,500 
Total liabilities and stockholders' equity$6,661,262 $6,837,606 
© 2026 Unity Technologies
U N I T Y . C O M|
4

UNITY SOFTWARE INC.
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS
(In thousands, except per share amounts)
(Unaudited)
Three Months EndedSix Months Ended
June 30,June 30,
2026202520262025
Revenue$546,468 $440,944 $1,054,706 $875,944 
Cost of revenue111,709 114,211 463,346 228,168 
Gross profit434,759 326,733 591,360 647,776 
Operating expenses
Research and development278,275 214,807 532,700 435,432 
Sales and marketing132,368 161,513 327,745 323,526 
General and administrative56,335 69,165 114,547 135,505 
Total operating expenses466,978 445,485 974,992 894,463 
Loss from operations(32,219)(118,752)(383,632)(246,687)
Interest expense(6,032)(6,030)(12,052)(11,921)
Interest income and other income (expense), net17,941 19,837 21,405 77,948 
Loss before income taxes(20,310)(104,945)(374,279)(180,660)
Provision for (benefit from) Income taxes2,362 2,420 (4,680)4,612 
Net loss(22,672)(107,365)(369,599)(185,272)
Net income attributable to noncontrolling interest and redeemable noncontrolling interests934 1,433 1,617 1,168 
Net loss attributable to Unity Software Inc.(23,606)(108,798)(371,216)(186,440)
Basic and diluted net loss per share attributable to Unity Software Inc.$(0.05)$(0.26)$(0.85)$(0.45)
Weighted-average shares used in computation of basic and diluted net loss per share437,898 417,566 436,069 414,696 
Net loss(22,672)(107,365)(369,599)(185,272)
Change in foreign currency translation adjustment3,823 2,716 6,871 3,894 
Comprehensive loss$(18,849)$(104,649)$(362,728)$(181,378)
Net income attributable to noncontrolling interest and redeemable noncontrolling interests934 1,433 1,617 1,168 
Foreign currency translation attributable to noncontrolling interest and redeemable noncontrolling interests800 564 1,435 818 
Comprehensive income attributable to noncontrolling interest and redeemable noncontrolling interests1,734 1,997 3,052 1,986 
Comprehensive loss attributable to Unity Software Inc.$(20,583)$(106,646)$(365,780)$(183,364)
© 2026 Unity Technologies
U N I T Y . C O M|
5

UNITY SOFTWARE INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
(Unaudited)
Three Months EndedSix Months Ended
June 30,June 30,
2026202520262025
Operating activities
Net loss$(22,672)$(107,365)$(369,599)$(185,272)
Adjustments to reconcile net loss to net cash provided by operating activities:
Depreciation and amortization85,475 96,928 212,730 193,145 
Stock-based compensation expense79,948 101,604 157,113 200,394 
Gain on repayment of convertible note— — — (42,744)
Impairment of intangible assets— — 270,506 — 
Impairment of property and equipment25 579 8,447 4,049 
Impairment of investments— — 15,000 — 
Other1,097 (7,754)2,566 (7,972)
Changes in assets and liabilities, net of effects of acquisitions:
Accounts receivable, net(57,170)(43,083)(67,366)(22,061)
Prepaid expenses and other44,553 24,373 26,155 13,771 
Other assets2,933 1,866 12,267 11,889 
Accounts payable2,027 (4,297)(3,211)(2,099)
Accrued expenses and other(6,428)7,417 7,532 (13,612)
Publisher payables63,112 33,590 24,634 (21,565)
Other long-term liabilities2,184 (1,942)(37,763)(12,861)
Deferred revenue10,538 31,180 17,897 31,060 
Net cash provided by operating activities205,622 133,096 276,908 146,122 
Investing activities
Purchases of non-marketable investments— (2,000)— (2,000)
Purchases of property and equipment(3,663)(6,446)(8,492)(12,164)
Net cash used in investing activities(3,663)(8,446)(8,492)(14,164)
Financing activities
Proceeds from issuance of convertible notes— — — 690,000 
Purchase of capped calls— — — (44,436)
Payment of debt issuance costs— — — (13,236)
Repayments of convertible note— — — (641,691)
Proceeds from issuance of common stock upon exercise of stock options and purchase of ESPP shares4,551 9,783 16,194 31,394 
Net cash provided by financing activities4,551 9,783 16,194 22,031 
Effect of foreign exchange rate changes on cash, cash equivalents, and restricted cash4,522 15,440 8,210 19,637 
Increase in cash, cash equivalents, and restricted cash211,032 149,873 292,820 173,626 
Cash, cash equivalents, and restricted cash, beginning of period2,146,089 1,551,634 2,064,301 1,527,881 
Cash, cash equivalents, and restricted cash, end of period$2,357,121 $1,701,507 $2,357,121 $1,701,507 
© 2026 Unity Technologies
U N I T Y . C O M|
6

About Non-GAAP Financial Measures
To supplement our consolidated financial statements prepared and presented in accordance with generally accepted accounting principles in the United States (GAAP) we use certain non-GAAP financial measures, as described below, to evaluate our ongoing operations and for internal planning and forecasting purposes. We believe the following non-GAAP measures are useful in evaluating our operating performance. We are presenting these non-GAAP financial measures because we believe, when taken collectively, they may be helpful to investors because they provide consistency and comparability with past financial performance.
However, non-GAAP financial measures have limitations in their usefulness to investors because they have no standardized meaning prescribed by GAAP and are not prepared under any comprehensive set of accounting rules or principles. In addition, other companies, including companies in our industry, may calculate similarly-titled non-GAAP financial measures differently or may use other measures to evaluate their performance, all of which could reduce the usefulness of our non-GAAP financial measures as tools for comparison. As a result, our non-GAAP financial measures are presented for supplemental informational purposes only and should not be considered in isolation or as a substitute for our consolidated financial statements presented in accordance with GAAP.
We define adjusted EBITDA as GAAP net income or loss excluding benefits or expenses associated with stock-based compensation, amortization and impairment of acquired intangible assets, depreciation, restructurings and reorganizations, interest, income tax, and other non-operating activities, which primarily consist of foreign exchange rate gains or losses. We define adjusted EBITDA margin as adjusted EBITDA as a percentage of revenue. We define adjusted gross profit as GAAP gross profit excluding expenses associated with stock-based compensation, amortization and impairment of acquired intangible assets, depreciation, and restructurings and reorganizations. We define adjusted gross margin as adjusted gross profit as a percentage of revenue.
We define adjusted cost of revenue as GAAP cost of revenue, excluding expenses associated with stock-based compensation, amortization and impairment of acquired intangible assets, depreciation, and restructurings and reorganizations. We define adjusted research and development expense as GAAP research and development expense, excluding expenses associated with stock-based compensation, amortization and impairment of acquired intangible assets, depreciation, and restructurings and reorganizations. We define adjusted sales and marketing expense as GAAP sales and marketing expense, excluding expenses associated with stock-based compensation, amortization and impairment of acquired intangible assets, depreciation, and restructurings and reorganizations. We define adjusted general and administrative expense as GAAP general and administrative expense excluding expenses associated with stock-based compensation, depreciation, impairment of acquired intangible assets, and restructurings and reorganizations. We define free cash flow as net cash provided by operating activities less cash used for purchases of property and equipment.
We define adjusted EPS as GAAP net income or loss excluding benefits or expenses associated with stock-based compensation, amortization and impairment of acquired intangible assets, depreciation, restructurings and reorganizations, and the income tax impact of the preceding adjustments (cumulatively "adjusted net income"), increased by the tax effected impacts from any relevant dilutive securities, divided by the diluted weighted-average outstanding shares. The effective tax rate used in calculating adjusted EPS is estimated for each period, based on the net income or loss adjusted for the items noted above, and may differ from the effective rate used in our financial statements. Shares of common stock that are excluded in our calculation of GAAP diluted net loss per share due to their antidilutive impact on such calculations, are included in the diluted weighted average outstanding shares used in our calculation of adjusted EPS, to the extent they have a dilutive impact on adjusted EPS given the adjusted net income in each period.
© 2026 Unity Technologies
U N I T Y . C O M|
7

UNITY SOFTWARE, INC.
Non-GAAP Reconciliation
(In thousands)
Three Months EndedSix Months Ended
June 30,June 30,
2026202520262025
Adjusted EBITDA reconciliation
Revenue$546,468 $440,944 $1,054,706 $875,944 
GAAP net loss$(22,672)$(107,365)$(369,599)$(185,272)
Add:
Stock-based compensation expense$75,576 $101,435 $152,445 $196,751 
Amortization of intangible assets expense$77,490 $86,218 $194,904 $171,868 
Depreciation expense$7,985 $10,710 $17,826 $21,277 
Impairment of intangible assets$— $— $278,666 $— 
Restructuring and reorganization costs$31,359 $10,886 $38,262 $31,231 
Interest expense$6,032 $6,030 $12,052 $11,921 
Interest income and other income (expense), net$(17,941)$(19,837)$(21,405)$(77,948)
Provision for (benefit from) income taxes$2,362 $2,420 $(4,680)$4,612 
Adjusted EBITDA$160,191 $90,497 $298,471 $174,440 
GAAP net loss margin(4)%(24)%(35)%(21)%
Adjusted EBITDA margin29 %21 %28 %20 %
Adjusted gross profit reconciliation
GAAP gross profit$434,759 $326,733 $591,360 $647,776 
Add:
Stock-based compensation expense6,712 9,861 14,094 18,973 
Amortization of intangible assets expense6,550 26,997 33,619 53,697 
Depreciation expense1,309 1,766 2,940 3,480 
Impairment of intangible assets— — 226,516 — 
Restructuring and reorganization costs3,915 275 3,862 809 
Adjusted gross profit$453,245 $365,632 $872,391 $724,735 
GAAP gross margin80%74%56%74%
Adjusted gross margin83%83%83%83%
Operating expenses reconciliation
Cost of revenue
GAAP cost of revenue$111,709 $114,211 $463,346 $228,168 
Stock-based compensation expense(6,712)(9,861)(14,094)(18,973)
Amortization of intangible assets expense(6,550)(26,997)(33,619)(53,697)
Depreciation expense(1,309)(1,766)(2,940)(3,480)
Impairment of intangible assets— — (226,516)— 
Restructuring and reorganization costs(3,915)(275)(3,862)(809)
Adjusted cost of revenue$93,223 $75,312 $182,315 $151,209 
GAAP cost of revenue as a percentage of revenue20%26%44%26%
Adjusted cost of revenue as a percentage of revenue17%17%17%17%
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UNITY SOFTWARE, INC.
Non-GAAP Reconciliation
(In thousands)
Three Months EndedSix Months Ended
June 30,June 30,
2026202520262025
Research and development
GAAP research and development expense$278,275 $214,807 $532,700 $435,432 
Stock-based compensation expense(39,469)(51,050)(78,097)(101,645)
Amortization of intangible assets expense(51,393)(16,332)(102,771)(32,862)
Depreciation expense(3,934)(5,340)(8,726)(10,606)
Impairment of intangible assets— — (3,998)— 
Restructuring and reorganization costs(22,379)(4,581)(25,955)(12,927)
Adjusted research and development expense$161,100 $137,504 $313,153 $277,392 
GAAP research and development expense as a percentage of revenue51%49%50%50%
Adjusted research and development expense as a percentage of revenue30%31%30%31%
Sales and marketing
GAAP sales and marketing expense$132,368 $161,513 $327,745 $323,526 
Stock-based compensation expense(12,940)(19,041)(27,112)(35,527)
Amortization of intangible assets expense(19,547)(42,889)(58,514)(85,309)
Depreciation expense(1,588)(2,156)(3,601)(4,310)
Impairment of intangible assets— — (46,969)— 
Restructuring and reorganization costs(4,237)(1,253)(6,551)(9,153)
Adjusted sales and marketing expense$94,056 $96,174 $184,998 $189,227 
GAAP sales and marketing expense as a percentage of revenue24%37%31%37%
Adjusted sales and marketing expense as a percentage of revenue17%22%18%22%
General and administrative
GAAP general and administrative expense$56,335 $69,165 $114,547 $135,505 
Stock-based compensation expense(16,455)(21,483)(33,142)(40,606)
Depreciation expense(1,154)(1,448)(2,559)(2,881)
Impairment of intangible assets— — (1,183)— 
Restructuring and reorganization costs(828)(4,777)(1,894)(8,342)
Adjusted general and administrative expense$37,898 $41,457 $75,769 $83,676 
GAAP general and administrative expense as a percentage of revenue11%16%11%15%
Adjusted general and administrative expense as a percentage of revenue7%9%7%10%
© 2026 Unity Technologies
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UNITY SOFTWARE, INC.
Non-GAAP Reconciliation
(In thousands)
Three Months EndedSix Months Ended
June 30,June 30,
2026202520262025
Adjusted EPS reconciliation
GAAP net loss$(22,672)$(107,365)$(369,599)$(185,272)
Stock-based compensation expense75,576 101,435 152,445 196,751 
Amortization of intangible assets expense77,490 86,218 194,904 171,868 
Depreciation expense7,985 10,710 17,826 21,277 
Impairment of intangible assets— — 278,666 — 
Restructuring and reorganization costs31,359 10,886 38,262 31,231 
Income tax impact of adjusting items(36,302)(20,527)(73,836)(48,291)
Adjusted net income used for calculation of adjusted EPS, before impact of dilutive instruments$133,436 $81,357 $238,668 $187,564 
Increase from forgone financing costs on dilutive convertible notes, net of tax4,676 789 9,344 9,299 
Adjusted net income used for calculation of adjusted EPS, including impact of dilutive instruments$138,112 $82,146 $248,012 $196,863 
Weighted-average common shares used in GAAP diluted net loss per share attributable to Unity Software Inc.437,898 417,566 436,069 414,696 
Convertible notes41,348 20,896 41,348 35,951 
Stock options and PVOs2,660 5,385 2,801 6,124 
Unvested RSUs, PVUs, and PSUs7,585 4,572 7,195 4,869 
ESPP— 4 63 327 
Non-GAAP weighted-average common shares used in adjusted EPS489,491 448,423 487,476 461,967 
GAAP diluted net loss per share attributable to Unity Software Inc.(0.05)(0.26)(0.85)(0.45)
Total impact on diluted net loss per share attributable to Unity Software Inc. from non-GAAP adjustments0.36 0.45 1.40 0.90 
Total impact on diluted net loss per share attributable to Unity Software Inc. from antidilutive common stock now included(0.03)(0.01)(0.04)(0.02)
Adjusted EPS0.28 0.18 0.51 0.43 
Free cash flow reconciliation
Net cash provided by operating activities$205,622 $133,096 $276,908 $146,122 
Less:
Purchases of property and equipment(3,663)(6,446)(8,492)(12,164)
Free cash flow201,959 126,650 268,416 133,958 
Net cash used in investing activities(3,663)(8,446)(8,492)(14,164)
Net cash provided by financing activities4,551 9,783 16,194 22,031 
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Cautionary Statement Regarding Forward-Looking Statements
This press release and the earnings call referencing this press release contain “forward-looking statements,” as that term is defined under federal securities laws, including statements regarding Unity’s outlook and future financial performance, including, but not limited to: (i) Unity’s ability to further enhance its platform, accelerate product innovation and enhance financial performance; (ii) expectations regarding Vector, including expectations regarding Vector’s improvements, performance, growth and impact on Unity’s overall future growth prospects; (iii) Unity’s strategic initiatives, including its continued investment and focus on artificial intelligence tools and redeployment of investments to core strategic priorities; (iv) expectations regarding Vector leveraging behavioral data available through Unity runtime; (v) expectations regarding Unity 7; (vi) statements regarding Unity’s product roadmap, products, projects, technology, ongoing product development and improvements, and customer demand for Unity products; (vii) statements regarding industry trends and business model evolution; (viii) statements regarding Unity’s market opportunity; (ix) expectations regarding Unity’s competitive position, core value proposition, and growth prospects; (x) expectations regarding improvements in operating margins; (xi) expectations regarding Unity’s operating discipline and cost management; (xii) expectations regarding future profitability, including Unity’s expectation to become GAAP profitable by the third quarter of 2026; (xiii) plans to pay off future obligations, including Unity’s plan to pay off its convertible notes issued in 2021 in November 2026 and to de-lever its balance sheet; and (xiv) Unity’s financial guidance for future periods. The words “aim,” “believe,” “may,” “will,” “estimate,” “continue,” “intend,” “expect,” “plan,” “project,” and similar expressions are intended to identify forward-looking statements. These forward-looking statements are subject to risks, uncertainties, and assumptions. If the risks materialize or assumptions prove incorrect, actual results could differ materially from the results implied by these forward-looking statements. Risks include, but are not limited to, those related to: (i) the impact of macroeconomic conditions, such as inflation, high interest rates, tariffs, sanctions and trade barriers, and limited credit availability which could further cause economic uncertainty and volatility; (ii) Unity’s ability to compete effectively; (iii) adverse changes in the geopolitical relationship between the U.S. and China; (iv) Unity’s ability to develop, deploy, maintain, manage, or commercialize artificial intelligence-enabled products; (v) Unity’s ability to address issues raised by the development or use of artificial intelligence in its offerings, or the use of artificial intelligence by its customers, personnel, vendors and competitors; (vi) Unity’s ability to execute its plans to realign its business and to right-size its investments, including the sunset of the ironSource Ads Network and the sale of its Supersonic game publishing business; (vii) the impact of any decisions to change how Unity prices its products and services; (viii) Unity’s ability to achieve and sustain profitability; (ix) Unity’s ability to retain existing customers and expand the use of its platform, or attract new customers; (x) Unity’s ability to further expand into adjacent business areas or new industries; (xi) the impact of any changes of terms of service, policies or technical requirements from operating system platform providers or application stores which may result in changes to Unity or its customers’ business practices; (xii) Unity’s ability to maintain favorable relationships with hardware, operating system, device, game console and other technology providers; (xiii) breaches in its security measures, unauthorized access to its platform, data, or its customers’ or other users’ personal data; (xiv) Unity’s ability to manage growth effectively and manage costs effectively; (xv) the rapidly changing and increasingly stringent laws, regulations, contractual obligations and industry standards that relate to privacy, data security and the protection of children; (xvi) Unity’s ability to attract, manage and retain its talent; (xvii) Unity’s ability to adapt effectively to rapidly changing technology, evolving industry standards, changing regulations, or changing customer needs, requirements, or preferences; and (xviii) the effectiveness of Vector. Further information on these and additional risks that could affect our results is included in our filings with the Securities and Exchange Commission (SEC), including our Annual Report on Form 10-K filed with the SEC on February 11, 2026, our Quarterly Report on Form 10-Q filed with the SEC on May 7, 2026, and our future reports that we may file with the SEC from time to time, which could cause actual results to vary from expectations. Copies of reports filed with the SEC are available on the Unity Investor Relations website. Statements herein speak only as of the date of this release, and Unity assumes no obligation to, and does not currently intend to, update any such forward-looking statements after the date of this release except as required by law.
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Contacts:
Investor Relations:
Alex Giaimo, Head of Investor Relations
alex.giaimo@unity3d.com

Media Relations:
UnityComms@unity3d.com

Source: Unity Software Inc.
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