Unity Software expects slower growth in the second and fourth quarters while rebuilding its data, but expects to be profitable by the end of the year, chief executive John Riccitiello told CNBC’s Jim Cramer on Wednesday.
“We’ve given our advice, and what it’s all about is [a] self-inflicted injury. We did some things on the advertising side of the business that reduced the accuracy of our models. It’s going to take us a few quarters to fix and we’re going to have slower growth for a few quarters while we fix it,” Riccitiello said in an interview on “Mad Money.”
Unity missed revenue expectations in its latest quarter and lowered its revenue forecast. The company cited flaws with its Audience Pinpointer tool in its Operate business and said it expects the business impact to be around $110 million this year.
Shares of the video software developer fell 37.05% on Wednesday, hitting a new 52-week low earlier in the day.
“We know that our stock was much higher nine months ago at the height of the market. And I feel like we probably spent about 10% too much in our business due to the euphoria that is going with.” Riccitiello said, adding that the company cut spending by $100 million from its original plan in response.
“What this allows us to do is bring the profitability of future years back into this year. At the end of this year, in the fourth quarter, we expect to be profitable,” he added.
Riccitiello also said Apple’s privacy changes weren’t a noticeable headwind in its most recent quarter. “It’s largely digested, so that’s not really the issue. … It’s been incorporated into our guidance this year,” he said.
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