Unity's Q2 2023 earnings show significant growth from 2022

Unity's financial earnings for its second quarter of the 2023-2024 fiscal year show largely continuous growth for the company. Despite missing estimates for the quarter (which ended on June 30, 2023), the analytics-heavy Grow Solutions and game dev-focused Create Solutions both performed well.  

Create Solutions saw $193 million in revenue, while Grow had $340 million. The latter division had a large surge of 157 percent compared to 2022 during the same three-month period. Create's increase was up by 17 percent. 

The $193 million is also how much Unity accrued in terms of net losses for the quarter, down 5.4 percent compared to the $204 million from 2022's second quarter. 

Combined, Create and Grow led to $533 million in overall revenue. It's up by 80 percent from Q2 2022's $297 million, and Grow was said to comprise nearly 64 percent of the entire quarter's earnings. 

In its earnings results, Unity noted that Grow's overperformance may have been in part due to Unity's "significant improvements" with its AI tools meant for game developers. It said its combined efforts alongside IronSource (which it acquired last November) has allowed for a stronger return of investment for the company's customers. 

As for Create, subscriptions were the primary reason for that division's growth, as core subscription business (excluding China) grew by 22 percent during the quarter. The engine maker also took the time to highlight recent Unity-made games Enhance's Humanity and Riot Forge's Convergence: A League of Legends Story.

What's next for Unity in 2023?

Looking immediately to the third quarter of the fiscal year, Unity plans to guide revenue in the $540-$550 million range. It's up by 67-70 percent on a year-over-year basis, and is based partly on the assumption that the ad market for video games will stay "relatively flat." 

For the remainder of the year, the company acknowledged that its strong first half may balance out the rest of the fiscal year during an "ongoing uncertain economic environment."

Part of Unity's larger plans will be finding out a way to create synergy between its Grow and Create divisions. The apparent aim will be to "create more value for customers and introduce new business models."