New York, Jan 14, 2026, 15:50 (EST) — Regular session
- Unity shares dropped nearly 8% amid a broad sell-off in software stocks
- Company scheduled its fourth-quarter and full-year 2025 earnings release for February 11
- Morgan Stanley raised its target to $52 just yesterday; Unity’s new pricing kicked in this week
Shares of Unity Software Inc fell 7.8% to $42.12 in late-afternoon trading Wednesday, deepening a selloff among high-growth software names. The videogame development tools firm touched a low of $40.76 during the session, down from $45.67 at Tuesday’s close.
This shift is crucial as Unity faces two immediate challenges that could rapidly alter forecasts: an earnings report on the horizon and recent subscription price adjustments. With markets jittery over interest rates, investors have little tolerance for stocks relying on consistent execution to support their valuations.
Unity announced Wednesday that it will report its fourth-quarter and full-year 2025 financial results before markets open on Feb. 11, with a webcast scheduled for 8:30 a.m. ET. 1
Two days ago, Unity’s Pro and Enterprise plans started showing a 5% price hike at renewal, following a November update. The company also revealed that some premium tiers linked to its Unity 6.3 long-term support release will drop Havok Physics. It expects to roll out wider free access to select DevOps tools—like cloud version control and build automation—by the end of Q1. 2
The decline coincided with a broad slump in software stocks. The iShares Expanded Tech-Software Sector ETF fell roughly 2.3% during the session.
Investors absorbed a late inflation report showing U.S. producer prices climbed 0.2% in November, matching economists’ expectations, according to Reuters. The Federal Reserve is widely expected to keep interest rates unchanged at its Jan. 27-28 meeting, a schedule that keeps growth stocks, sensitive to rate moves, under the spotlight. 3
Morgan Stanley’s Matthew Cost bumped his price target on Unity to $52 from $48 on Tuesday, maintaining an “overweight” rating, signaling he expects the stock to outperform. In a sector note highlighted by The Fly, Cost emphasized that the market is likely to favor companies delivering “material positive ROIC” — return on invested capital, which measures how effectively cash converts to profit — especially those linked to generative AI or GPU-powered tech. 4
Ad-tech and app economy stocks have struggled lately. AppLovin dropped over 9% Wednesday, even after Evercore ISI kicked off coverage with an outperform rating, Barron’s reported. Some Unity investors watch AppLovin closely for clues on mobile ad demand. 5
The downside is clear. Unity is still trying to win back developers after recent pricing chaos, and any hint that customers resist higher seat fees—or that ad demand drops—could hit the quarterly numbers fast. 6
