Oppenheimer ‘incrementally positive’ on Unity after runtime fee end

Oppenheimer says Unity Software cancelled its unpopular runtime fee, effective immediately, clearing the way for the launch of Unity 6. Meanwhile, Unity Pro and Unity Enterprise will see 8% and 25% subscription price increases, respectively, the analyst tells investors in a research note. After reviewing the details and speaking briefly with management, the firm came away “incrementally positive” on the near-term and longer-term business outlook for Unity’s Create segment. It believes reversing the unpopular runtime fee is critical to a successful launch for Unity 6, expected sometime in 2024. Moreover, potential annual increase of subscription fees starting 2025 will provide better business visibility for Unity customers, Oppenheimer adds. The firm says the news effectively removes the uncertainty around the timing and size of runtime fee contribution in 2025 and beyond. It keeps a Perform rating on the name.