It Cost Unity $205 Million To Make Mass Layoffs

As a seasoned gamer with decades of experience under my belt, I can’t help but feel a tad disheartened when hearing about Unity’s financial woes and the subsequent layoffs. It seems like in order to cut costs, they have to spend a pretty penny – a classic case of “robbing Peter to pay Paul.

To save money, you need to invest it. On a recent Thursday, Unity disclosed they would invest $205 million in their reorganization plan – encompassing significant staff reductions – over the course of 2024.

As a devoted follower, I can share that the funds were primarily allocated towards additional severance expenses for departing employees and an incremental $127 million in stock-based compensation.

RELATED: Unity’s New CEO Nets Millions Months After Layoffs and Scandals

According to Unity, out of the total expenses related to employee separations, $15 million fall under Cost of Revenue, $46 million under Research and Development, $52 million under Sales and Marketing, and a whopping $92 million under General and Administrative costs.

Additionally, the company mentioned that they also incurred approximately $45 million in expenses from restructuring activities associated with shutting down offices.

In January 2024, Unity revealed intentions to reduce their staff by 25%. This move was taken to concentrate on their primary operations and bolster their long-term prosperity and financial gains, as stated by the company’s CEO, Jim Whitehurst.

After Unity made a contentious decision to alter their runtime charges, they subsequently implemented job cuts and other modifications. However, this decision sparked criticism, leading them to eventually retract the change.

During its earnings conference, Unity announced that its quarterly revenue dropped by approximately 19% year-over-year, from $544.2 million to $446.5 million. This decrease occurred despite a reduction in operating expenses from $520.3 million to $461.6 million. The company reported a net loss of $124.5 million for the third quarter overall.

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