LogInThe studio continues to blame its losses on a "portfolio reset."
Unity Technologies has published its financial report for Q1 of fiscal year 2025, showing that the ghost of John Riccitiello still lingers, and the past few years, filled with controversy, six waves of layoffs, and the Unity engine losing ground to other game development software, continue to haunt the company to this day.
As reported by the studio, Unity's revenue in Q1 FY2025 was $435 million, compared to $460 million in Q1 2024, marking a $25 million or 6% year-over-year decline. Create Solutions revenue was $150 million, down 8% from $164 million during the same period last year, while Grow Solutions brought in $285 million, compared to $297 million in 2024, a 4% drop.
Much like in their earlier Q4 2024 report, which revealed a 25% year-on-year revenue decline – $457 million compared to $609 million in Q4 2023 – the company once again leaned on its "portfolio reset" – a term that refers to the company's strategy of shutting down parts of its business to refocus on core strengths – as an explanation for the falling numbers.
It's also worth pointing out that in Q1 2024, the new report's main point of reference, Unity disclosed an 8% net revenue decrease compared to the year before, making the current results look even worse when viewed in context. On top of that, the company doesn't appear to be expecting a near-term recovery, projecting even lower revenue of $415 to $425 million for Q2 2025.
"The Company's first quarter results once again meaningfully exceeded expectations on both revenue and Adjusted EBITDA, highlighting our progress as we continue to build a culture of execution and discipline," comments Unity CEO Matt Bromberg. "The early success of Unity Vector and continued strong demand for Unity 6 underscore our positioning as the leading integrated platform supporting developers across the full lifecycle of game development."
In what definitely seems to be a desperate attempt to improve its financial situation, Unity also conducted a round of job cuts earlier this year, affecting entire departments and described as "massive" by impacted employees. In an internal announcement about the layoffs, the CEO further revealed the company's 2025 strategy, which would focus on live services, AI, ads, and "fidelity for ubiquity" – an initiative aimed at helping customers reach the broadest audience across platforms and devices, rather than prioritizing the highest quality graphics on the market.
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