What made Unity Software shares plunge 35% in extended trading?

Unity Software Inc shares (NYSE: U) plummeted over 35% in after-hours trading on disappointing guidance for the fiscal second quarter. Its Q1 results, though, matched Street expectations.

Notable figures in Unity Software Q1 results

Lost $177.6 million in the first quarter that translates to 60 cents a share.In Q1 last year, Unity had lost $107.5 million or 39 cents per share.On an adjusted basis, per-share loss stood at 8 cents a share in fiscal Q1.Revenue jumped 36% to $320.1 million, as per the earnings press release.Consensus was for 8 cents of adjusted per-share loss on $321 million in revenue.Revenues from Create and Operate were up 65% and 26%, respectively.

The stock is now down more than 75% for the year. According to Unity Software, its revenue in Q1 hit an all-time high. In the earnings press release, CEO John Riccitiello said:

We remain focused on the massive opportunity we see in front of us long-term. Short-term, we are laser-focused on accelerating growth in Operate.

Q2 guidance and CFO’s remarks

For Q2, Unity Software forecasts its revenue to fall between $290 million and $295 million. In comparison, analysts had called for a much higher $360 million. The top end of its full-year guidance for revenue also missed FactSet consensus by $70 million.

The video game software development company expects up to $64 million in loss this quarter. In the earnings press release, CFO Luis Visoso said:

In Q1, we continued to add new customers and made strategic investments to support long-term value creation while improving margins. We believe we’re in the early stages of one of the largest transformations in tech.

The post What made Unity Software shares plunge 35% in extended trading? appeared first on Invezz.

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