Unity Software Inc.

Current report

If we fail to timely release updates and new features to our platform, develop successful new products, or adapt and respond effectively to rapidly changing technology and customer needs, requirements, or preferences, our platform may become less competitive.

Current report

The markets in which we operate are subject to rapid technological change, changing customer needs, requirements and preferences, and are highly competitive. The success of our business will depend, in part, on our ability to adapt and respond effectively to these changes and competitive pressures on a timely basis. Emerging technologies like AI are likely to impact the way that customers utilize our solutions, as well as enhance the functionality of our solutions. If we do not continue to improve our AI capabilities and data infrastructure on a timely basis or at all, our business could be harmed.

Current report

Our ability to retain and expand within our existing customers and attract new ones, and increase our revenue, depends in large part on our ability to maintain, improve and differentiate our existing platform and introduce new functionality promptly and effectively, as well as developing successful new product offerings. Revenue growth from our offerings also depends on our ability to continue to respond to advancements in competing technologies, and end-user demands and expectations, which will require us to incur additional costs to implement. If we do not continue to improve our platform with additional products, features and functionality in a timely fashion, or if new products or improvements to our platform are ineffective or otherwise not well received by customers, our revenue could be adversely affected.

Current report

For example, in October 2026, we announced Unity Spark, a browser-based, AI-powered game creation tool for creators, and plans to integrate it with Google's Playground platform. We expect to launch Unity Spark in closed beta later in 2026, but we may not do as anticipated or at all, and its features and availability may differ from what we have announced. There can be no assurance that Unity Spark will be successful, will generate significant revenue or become profitable.

Current report

If we fail to deliver timely releases of our solutions that are ready for commercial use, we release a version, service, tool or update with a material vulnerability, or other error, or we are unable to enhance our platform to keep pace with rapid technological changes or respond to new offerings by our competitors, or if new technologies emerge that are able to deliver competitive solutions at lower prices, more efficiently, more conveniently or more securely than our solutions, or if new operating systems, gaming platforms or devices are developed and we are unable to support our customers' deployment of games and other applications onto those systems, platforms or devices, our business, financial condition and results of operations could be adversely affected.

Current report

The actions of third parties with whom we do business may put our business and results of operations at risk.

Current report

We rely on third parties, including our strategic partners, for various aspects of our business, including deep technology collaborations, co-marketing, advertising partners, ad mediation services, ad attribution partners, development services agreements, and revenue share arrangements. Their actions may put our business, reputation, and brand at risk. In many cases, third parties may be given access to sensitive and proprietary information or personal information in order to provide services and support to our teams or customers, and they may misappropriate and engage in unauthorized use of our information, technology or customers' data. In addition, the failure of these third parties to provide adequate services and technologies, or the failure of the third parties to adequately maintain or update their services and technologies, could result in a disruption to our business operations. For example, we rely on ad attribution partners to accurately and reliably perform mobile measurement and attribute ad impressions. Any failure of those services may result in a reduction in the number of ads attributed to our ad platform and a resulting reduction in our revenue and the revenue realized by our ad publishers. Further, disruptions in the mobile application industry, financial markets, economic downturns, poor business decisions, or reputational harm may adversely affect our partners and may increase their propensity to engage in fraud or otherwise illegal or improper activity which could harm our business reputation, and they may not be able to continue honoring their obligations to us, or we may cease our arrangements with them. Similarly, we rely on third-party mediation platforms, some of which, including the MAX mediation platform ("MAX"), are operated by, or affiliated, with competing advertising networks. The majority of our Grow Solutions revenue is mediated through MAX. Our access to MAX is governed by a header bidding agreement (the "HBA") with AppLovin Corporation ("AppLovin"), which, if terminated, would prevent us accessing MAX. Interruption or loss of access to MAX would significantly harm our business and financial results. Alternative arrangements and services may not be available to us on commercially reasonable terms or at all and we may experience business interruptions upon a transition to an alternative partner or vendor. If we lose one or more business relationships, or experience a degradation of services, our business could be harmed and our financial results could be adversely affected.

Current report

On September 27, 2026, AppLovin filed an arbitration claim against us with JAMS alleging, among other things, breach of the HBA and unlawful and unfair business acts or practices related to our Ad Quality SDK (the "Arbitration Claim"), and sought provisional injunctive relief in San Francisco Superior Court to enjoin us from collecting or using what AppLovin claims to be its confidential and proprietary data, to disable that collection and to modify Ad Quality so that it no longer collects or uses that data. The court denied AppLovin's request on October 1, 2026. We have denied all of the allegations of wrongdoing in the Arbitration Claim and filed counterclaims against AppLovin with JAMS, including unfair competition on AppLovin's part. Although we cannot predict the ultimate outcome of the Arbitration Claim, we believe AppLovin's claims are without merit and intend to vigorously defend against them and pursue our counterclaims. An adverse ruling, or a deterioration in our relationship with AppLovin arising from the dispute, or otherwise, could result in changes to the terms on which we participate in MAX, restrictions on our use of data or technology relevant to our advertising business, a suspension or degradation of our access to MAX, and significant costs and expenses, any of which could materially and adversely affect our revenue and results of operations. In addition, disputes of this nature can be time-consuming and expensive to resolve and they divert management's time and attention and may harm our reputation and business.

Previous report

If we fail to successfully execute our plans to realign our business and to right-size our investments, our business will be harmed.

Previous report

We have realigned our business to focus on the Unity Engine and related consumption services, and monetization solutions, and are continuing to exit other businesses and right-size our investments, including through workforce reductions. These actions may not be effective or sufficient to offset our expenses, and may themselves have adverse impacts, including loss of accumulated knowledge, limited technological support on legacy products, inefficiency, and other challenges to operating our business. If we fail to efficiently execute on these plans, or if the expected benefits are not achieved on the timeline or to the extent we expect, our business may be harmed and we may fail to achieve or maintain profitability.

Previous report

In the first quarter of 2026, we announced we would sunset the ironSource Ads Network, one of our monetization networks, effective April 30, 2026, and we began the process of exiting our Supersonic game publishing business. The sunset of the ironSource Ads Network was substantially completed in the second quarter of 2026, and the sale of our Supersonic business was completed on August 4, 2026. These actions have caused and may continue to cause disruption and uncertainty for our employees, customers, publishers, advertisers, and strategic partners, and have resulted and may continue to result in employee attrition and difficulties in maintaining business relationships. Customers or partners have delayed, reduced, or terminated and may continue to delay, reduce, or terminate their use of our offerings as a result.

Previous report

The sunset of the ironSource Ads Network has resulted and may continue to result in higher-than-expected customer and revenue attrition.

Previous report

Any failure to successfully manage these changes could disrupt our operations, damage customer relationships, fail to deliver the anticipated financial benefits, lead to additional costs and materially harm our business and results of operations.