In this video, I will go over Unity's (U -1.90%) second-quarter earnings and talk about what I plan on doing regarding the new merger proposition from AppLovin

  • Earlier in July, it was announced that Unity and ironSource have reached a merger agreement
  • On Aug. 9, before the marker opened, AppLovin submitted a proposal to combine with Unity. The all-stock merger values Unity at $58.85 per share.
  • One of the terms is that Unity should terminate its deal with ironSource (a big competitor). To me, this is a sign of weakness from AppLovin, and as a Unity shareholder, I will vote against the merger if that comes to pass. 
  • Unity reported revenue of $297 million, up 9% year over year (YOY).
  • Revenue from the create solutions segment grew 66% YOY to $120.9 million.
  • Revenue from the operate solutions segment decreased 13% YOY to $158.5 million.
  • Revenue from strategic partnerships and other segments came in at $17.7 million, a decrease of 2% YOY.
  • Customers generating more than $100,000 of revenue in the trailing 12 months reached 1,085, up from 888 the year prior.
  • The dollar-based net expansion rate came in at 121%, up from 142% the year prior.
  • The company expects to grow revenue in Q3 by 13.5% at the midpoint to $325 million. And for the full year, the company guided for 19.5% growth at the midpoint as well.

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*Stock prices used were the closing prices of Aug. 9, 2022. The video was published on Aug. 10, 2022.