Unity Stock Soars 7.73% After Reported Takeover Talks, Adding $1.7 Billion In Market Value
The game-software company was headed for a fifth straight daily gain after reporting its first profitable quarter since its IPO.
Unity Software, which makes tools for building and monetizing games and interactive content, soared 7.73% to $52.57 in Friday trading, as of 1:01 PM ET, adding $1.7 billion in market value after a report of takeover talks involving Silver Lake Partners and Saudi Arabia’s Public Investment Fund. The shares reached a new 52-week high, with Unity on pace for its fifth straight daily gain.
A Takeover Report And Higher Target
Unity’s market value stood at $23.14 billion in Friday trading, as of 1:01 PM ET. Before Friday’s advance, the stock had gained 11% this year at Thursday’s close, compared with an 8% rise for the S&P 500.
Needham analyst Bernie McTernan raised his target from $54.00 to $70.00 and kept his Buy rating. The takeover talks remain a reported development.
Advertising Leads The Revenue Growth
Thursday’s earnings release put third-quarter revenue at $622 million, 32% above a year earlier. Unity earned $122 million under standard accounting, its first profitable quarter since its IPO, with a net margin of 20%.
Unity President and CEO Matt Bromberg said, “Third-quarter performance was our strongest ever,” and pointed to Vector’s growth of 126% from a year earlier and 40% from the previous quarter.
Grow Solutions, the advertising side of Unity’s business, generated $457 million, up 44% from $318 million a year earlier. Unity attributed that growth to its Unity Ads Network and Vector, partly offset by declines in the ironSource Ads Network. Create Solutions revenue rose 8% to $165 million, versus $152 million a year earlier.
Create supplies Unity’s real-time 3D engine and development tools for games and industries including automotive, healthcare and robotics. Grow helps customers attract users and earn money through an ad network, mediation platform and offerwall, including for content built without Unity.
A Larger Strategic Business
Revenue from businesses Unity labels strategic reached $597 million, up 59%. Strategic Grow revenue increased 90%, while Strategic Create revenue rose 11%. Non-strategic revenue fell 73%; that category primarily includes the ironSource Ads network, shut down in the second quarter, and Supersonic publishing, sold on August 4, 2026.
The quarter produced $257 million in adjusted earnings before interest, taxes, depreciation and amortization, with a 41% margin. Operating cash flow was $224 million, and free cash flow reached $220 million. Basic earnings per share were $0.27, diluted earnings were $0.25 and adjusted earnings were $0.44.
For the fourth quarter, Unity expects strategic revenue of $683 million to $691 million, up 65% to 67% year over year. That includes strategic Grow revenue of $515 million to $520 million, up 105% to 107%, and strategic Create revenue of $168 million to $171 million, up 4% to 6%. Unity forecasts $5 million of non-strategic revenue.
Unity’s fourth-quarter outlook calls for adjusted earnings before interest, taxes, depreciation and amortization of $290 million to $295 million, an increase of 132% to 136% from a year earlier.
Sources
- Unity Software Analysts Boost Their Forecasts After Strong Q3 Results — benzinga.com
- Unity Software gains on report Silver Lake, PIF have had takeover talks | Seeking Alpha — seekingalpha.com
- After EA, Saudi Arabia Is Reportedly Setting Its Sights On One Of Gaming's Biggest Engines - GameSpot — gamespot.com
- Silver Lake, Saudi Arabia’s PIF Made Takeover Approach for Unity Software — The Information — The Information
- Unity Stock Flirts With Buy Zone On Improved Profitability | Investor's Business Daily — investors.com
- The company's filing (Unity Software) — SEC filing
- Unity Software — Form 10-Q for the quarter ended 2026-09-30 (quarterly results) — SEC EDGAR
- Unity Software — earnings release (Form 8-K, Item 2.02), filed 2026-11-05 — SEC EDGAR
