U Q3 2021 Earnings

Call Details

• Call Title: Unity Software Inc. Q3 2021 Earnings Call
• Date: November 9, 2021 at 10:00 PM UTC
• Management Team:
  • Richard Davis (Head of Investor Relations)
  • John Riccitiello (President and Chief Executive Officer and Executive Chairman)
  • Luis Visoso (Senior Vice President and Chief Financial Officer)
  • Marc Whitten (Senior Vice President of Create Solutions)

Call Summary

Financial Performance

• Revenue was $286M in Q3 2021, representing 43% year-over-year growth.
• Operate segment delivered 54% year-over-year growth in the quarter.
• Create segment delivered 34% year-over-year growth in the quarter.
• Non-GAAP gross margin was 81%, up from 79% in the prior-year quarter.
• Non-GAAP operating loss was $12M in the quarter compared to $8.4M a year ago.
• Free cash flow for the quarter was $34M and year-to-date free cash flow was negative $100M, which included approximately $50M in lease-dispute charges.
• Dollar-based net expansion rate for the quarter was 142%.

Guidance

• Q4 revenue guidance was set at $285M to $290M, representing 29% to 32% year-over-year growth.
• Full-year 2021 revenue guidance was raised to $1.08 to $1.085B, representing 40% year-over-year growth.
• The full-year guide was increased by $25M on the high side versus prior guidance.
• Q4 non-GAAP operating loss guidance was $20M to $25M.
• Full-year non-GAAP operating loss guidance was $59M to $64M.
• The company forecasted 329M fully diluted shares for the period referenced.
• The company reiterated its target to break even on a free cash flow basis within fiscal 2023.