Winners And Losers Of Q3: Unity (NYSE:U) Vs The Rest Of The Design Software Stocks
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Looking back on design software stocks’ Q3 earnings, we examine this quarter’s best and worst performers, including Unity (NYSE:U) and its peers.
The demand for rich, interactive 2D, 3D, VR and AR experiences is growing, and while the ubiquitous metaverse might still be more of a buzzword than a real thing, what is real is the demand for the tools to create these experiences, whether they are games, 3D tours or interactive movies.
The 6 design software stocks we track reported a strong Q3. As a group, revenues beat analysts’ consensus estimates by 4.4% while next quarter’s revenue guidance was 2.9% below.
In light of this news, share prices of the companies have held steady. On average, they are relatively unchanged since the latest earnings results.
Unity (NYSE:U)
Started as a game studio by three friends in a Copenhagen apartment, Unity (NYSE:U) is a software as a service platform that makes it easier to develop and monetize new games and other visual digital experiences.
Unity reported revenues of $446.5 million, down 18% year on year. This print exceeded analysts’ expectations by 4.3%. Overall, it was a mixed quarter for the company with an impressive beat of analysts’ billings estimates but EBITDA guidance for next quarter missing analysts’ expectations.
Unity delivered the slowest revenue growth and weakest full-year guidance update of the whole group. Unsurprisingly, the stock is down 16.2% since reporting and currently trades at $18.64.
Is now the time to buy Unity? Access our full analysis of the earnings results here, it’s free.
Best Q3: ANSYS (NASDAQ:ANSS)
Used to help design the Mars Rover, Ansys (NASDAQ:ANSS) offers a software-as-a-service platform that enables simulation for engineering and design.
ANSYS reported revenues of $601.9 million, up 31.2% year on year, outperforming analysts’ expectations by 14.9%. The business had a stunning quarter with an impressive beat of analysts’ EBITDA estimates and a solid beat of analysts’ annual contract value estimates.
ANSYS pulled off the biggest analyst estimates beat and fastest revenue growth among its peers. The market seems content with the results as the stock is up 2% since reporting. It currently trades at $339.99.
Is now the time to buy ANSYS? Access our full analysis of the earnings results here, it’s free.
Weakest Q3: Adobe (NASDAQ:ADBE)
One of the most well-known Silicon Valley software companies around, Adobe (NASDAQ:ADBE) is a leading provider of software as service in the digital design and document management space.
Adobe reported revenues of $5.41 billion, up 10.6% year on year, exceeding analysts’ expectations by 0.6%. Still, it was a slower quarter as it posted revenue guidance for next quarter slightly missing analysts’ expectations.