Unity downgraded to Perform on reduced outlook at Oppenheimer

Oppenheimer analyst Martin Yang downgraded Unity to Perform from Outperform without a price target post the Q4 results. The company’s fiscal 2023 revenue outlook fell short of estimates due to weaker in-game advertising market and macro factors, the analyst tells investors in a research note. While management’s more conservative outlook further de-risks 2023 expectations, Unity’s valuation multiple sufficiently accounted for updated revenue growth and margin profiles, the analyst tells investors in a research note. The firm wants to see more evidence of a mobile ad market recovery and Unity’s expansion among nongaming enterprise customers before recommending the shares.