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Unity (U) stock sinks on lowered guidance and ironSource merger

Unity (U) shares are on the downward trend following some unfavorable news for investors.

Donovan Erskine

July 13, 2022 9:50 AM

Image: Unity

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Unity recently made headlines when it was reported that the company would be laying off hundreds of its employees. In addition to the human cost, the news also led to a drop in Unity (U) stock, and today’s news is having a similar impact. Unity has lowered its guidance for 2022 and announced a merger with ironSource, and the stock is on the decline as a result.

Unity announced earlier today that it would be merging with ironSource in a release to Business Wire. A software company that specializes in app monetization, ironSource is just the latest company to be acquired by Unity. Unity paid $4 billion to purchase Unity, and in the last year, the company made major splashes in acquiring Weta Digital and Parsec. Despite the major spending spree, the company is reportedly gearing up to lay off hundreds of workers.

Furthermore, Unity also announced that it would be lowering its 2022 guidance in the news release. Guidance will drop from $1,350 - $1,425 million to $1,300 - $1,350 million. The news of the company’s merger as well as the lowered guidance for the remainder of the year has spelled out bad news for Unity (U) stock. Shares fell 13 percent on the news. Valued at $39.76 at the close of markets yesterday, Unity (U) stock was as low as $32.98 on the news.

It’s certainly been an odd streak of news for Unity, the company behind one of gaming’s most popular engines. With yet another acquisition under its belt, it will be interesting to see what exactly the company’s game plan is moving forward. We can expect Unity to make its Q2 2022 earnings report sometime next month, so more information will likely be available then. For more finance news out of the gaming world, stick with Shacknews.

Donovan Erskine

News Editor

Donovan is a young journalist from Maryland, who likes to game. His oldest gaming memory is playing Pajama Sam on his mom's desktop during weekends. Pokémon Emerald, Halo 2, and the original Star Wars Battlefront 2 were some of the most influential titles in awakening his love for video games. After interning for Shacknews throughout college, Donovan graduated from Bowie State University in 2020 with a major in broadcast journalism and joined the team full-time. He is a huge Scream nerd and film fanatic that will talk with you about movies and games all day. You can follow him on twitter @Donimals_