Q3 2026 results
| Metric | Result | Change |
|---|---|---|
| Strategic Revenue | $597 million | Up 59% year-over-year |
| Strategic Growth Revenue | $432 million | Up 90% year-over-year |
| Strategic Create Revenue | $165 million | Up 11% year-over-year |
| Net Income | $122 million | First time since IPO |
| Adjusted EBITDA | $257 million | Up 134% year-over-year |
| Free Cash Flow | $220 million | Record |
Guidance and outlook
- Q4 total strategic revenue is expected to be $683 million to $691 million.
- Q4 Strategic Growth revenue is expected to grow 105% to 107% year-over-year.
- Q4 Strategic Create revenue is expected to grow 4% to 6% year-over-year.
- Q4 adjusted EBITDA is expected to be $290 million to $295 million.
How management sounded
Confident (+8 on our -10 to +10 scale). Management reported record results, achieved first-time GAAP profitability, and provided strong guidance for continued acceleration. Management sounded more upbeat than on 92% of the 190 calls we cover; most companies sound positive on their own calls, so the comparison says more than the label.
Q&A summary
Vector Growth Drivers
Asked: Analysts asked about the drivers of the 40% sequential growth in Vector and the durability of these trends.
Answer: Management attributed growth to continuous product enhancements, high-quality data, and compounding model improvements, noting that the business is still in its early stages.
Unity Spark Strategy
Asked: Analysts asked how Spark differentiates from other AI creation tools and if it negates the need for a traditional engine.
Answer: Management stated Spark is designed for high-quality, collaborative creation rather than casual content, leveraging Unity's professional expertise and asset store.
AI Impact on Financials
Asked: Analysts asked where the benefits of AI inflection will appear in the financials.
Answer: Management explained that AI drives the entire flywheel, from creation efficiency to ad discovery, and that they are already seeing these impacts across the business.
Guidance Philosophy
Asked: Analysts asked if the large beat in Vector implies a change in guidance philosophy.
Answer: Management stated they will continue to provide guidance based on current visibility, noting that while they aim to exceed targets, some quarters may see unforeseen step changes.
What to watch before the next call
- The full launch of Unity Spark in 2027 and its impact on platform revenue.
- The continued adoption of coding agents and their effect on user engagement.
- The ability to maintain high growth rates in Unity Vector as the business scales.
