"The Turnaround Thesis: What Analysts See The bull case rests on Q3 2025's surprise beat. Unity Software ( NYSE:U) posted $0.20 earnings per share against expectations of a $0.23 loss, a 187% beat marking the first profitable quarter in recent memory. Revenue hit $471 million with 5.4% growth, while adjusted EBITDA margins expanded 200 basis points to 23%. CEO Matthew Bromberg called it an inflection point:"
"The catalyst is Vector, Unity's AI-powered advertising platform. The Grow segment posted 11% sequential growth in Q3, with management claiming "broad-based improvement across all customer sets, small and big geography, genre." BTIG upgraded to Buy with a $60 target, citing Vector's momentum and an Epic Games partnership extending Unity's monetization tools to Unreal Engine developers. Four analysts rate Unity a Strong Buy, 12 say Buy, with a consensus target of $47.60 suggesting 14% upside from current levels around $42."
Unity Software reported an unexpected profitable quarter in Q3 2025, posting $0.20 earnings per share versus an expected $0.23 loss. Revenue reached $471 million with 5.4% growth and adjusted EBITDA margins improved by 200 basis points to 23%. Analysts cite Vector, Unity's AI-powered advertising platform, and an Epic Games partnership as catalysts for monetization and growth, prompting multiple upgrades and a consensus price target implying upside. The stock is down 5% year-to-date, trades at about 88x forward earnings, continues to burn cash, and insiders sold 1.7 million shares between October and January. A scheduled Q4 earnings report arrives in about twenty days, leaving uncertainty between analyst optimism and investor skepticism.
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