Unity Software Cuts Q1 Outlook Despite $503M Q4 Revenue Beat, Shares Drop
Unity Software reported Q4 revenue of $503M topping estimates but guided Q1 revenue at $480–490M below analyst forecasts. The stock trades 43% below its 20-day SMA with a 24.6 RSI reading and analysts cut price targets to $26–$43, driving a 4.2% drop Friday.
1. Fourth-Quarter Results and Guidance
Unity reported Q4 revenue of $503M, topping consensus, but Q1 guidance of $480M–$490M fell short of the $500M estimate. Its advertising segment grew 15% sequentially versus an expected 20%, and the impending ironSource ad unit closure poses additional headwinds.
2. Technical Weakness Signals
Shares trade 43% below the 20-day SMA and 52% below the 100-day SMA, with an RSI reading of 24.55 signaling oversold conditions and MACD below its signal line, underscoring bearish momentum.
3. Analyst Price Target Adjustments
Macquarie, Citigroup and UBS lowered targets to $37, $43 and $26 respectively, dragging the consensus price target to $38.13; the share price fell 4.2% to $18.83 on Friday in response.