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Item 1A. Risk Factors

2026-02-11 compared with 2025-02-21 · 426 added, 413 removed, 429 unchanged (66% of the section changed)

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We have experienced significant net losses on a GAAP basis in each period since inception.

In addition, our revenue has varied and, in certain quarters and annual periods, declined and could vary and decline in the future.

In addition, our revenue has varied and, in certain periods, declined and could vary or decline in the future.

We are not certain whether we will achieve or maintain profitability in the future.

Our costs and expenses may increase in the long term on a GAAP basis, which could negatively affect our future results of operations.

In addition, we may continue to make investments in such areas as:

In addition, our investments in areas such as:

• research and development, including investments in our engineering teams and in further differentiating our platform, as well as the development of new solutions and features;

• our sales and marketing organizations to engage our existing and prospective customers, increase brand awareness and drive adoption and expansion of our platform and solutions;

• initiatives to grow our presence in new industries and use cases beyond the gaming industry;

• our technology infrastructure, including systems architecture, scalability, availability, performance, and security;

• initiatives to grow our presence in new or adjacent industries and use cases beyond the gaming industry;

• our technology infrastructure, including systems architecture, hosting, scalability, availability, performance, and security;

• acquisitions or strategic investments;

• global expansion;

• global expansion or restructuring;

• our general and administration organization, including legal, IT, and accounting expenses,

Our efforts to achieve profitability may be costlier than we expect and may not be effective.

Even if such investments increase our revenue, any such increase may not be enough to offset increased operating expenses.

Cost-cutting efforts, such as discontinuing certain product offerings, reducing our workforce or reducing our office footprint, may not be effective or may not be effective on the timelines we expect.

We have a limited history operating our business at its current scale, and as a result, our past results may not be indicative of future operating performance.

We have a limited history operating our business at its current scale and scope.

will vary from period to period, which will impact our costs and ability to achieve and maintain profitability.

Even if such investments increase our revenue, any such increase may not be enough to offset any increase in operating expenses.

Our past results may not be indicative of future operating performance.

You should not rely on our past results of operations as indicators of future performance.

Overall growth of our revenue is difficult to predict and depends in part on our ability to execute on enhancing our machine learning stack and data infrastructure capabilities, our portfolio reset, and other growth strategies.

You should consider and evaluate our prospects in light of the risks and uncertainties frequently encountered by growing companies in rapidly evolving markets.

These risks and uncertainties include challenges in accurate financial planning as a result of limited historical data relevant to the current scale and scope of our business and the uncertainties resulting from having had a relatively limited time period in which to implement and evaluate our business strategies as compared to companies with longer operating histories.

Overall growth of our revenue is difficult to predict and depends, in part, on our ability to execute on enhancing our artificial intelligence (“AI”) capabilities and data infrastructure, our ongoing business realignment, and other growth strategies.

You should evaluate our prospects in light of the risks and uncertainties frequently encountered by growing companies in rapidly evolving markets.

If we are not able to grow efficiently, and manage our costs, we may not achieve profitability on a GAAP basis.

We are aiming to achieve and maintain profitability on a GAAP basis.

We aim to achieve and maintain profitability on a GAAP basis.

To do so, we need to continuously improve our platform’s capabilities, features and functionality.

In addition, we will need to appropriately scale our internal business, IT, and financial, operating and administrative systems to serve our growing customer base, while continuing to manage headcount, capital and operating and reporting processes in an efficient manner.

Any failure of or delay in these efforts could result in impaired

Any failure of, or delay in, these efforts could result in impaired performance, reduced customer satisfaction and decreased sales to new customers, which would hurt our revenue growth and our reputation.

In addition, costs associated with our third-party cloud service providers represent a significant portion of our ongoing expenses, and any failure to manage or optimize those costs or commitments could negatively impact our gross margins.

Even if we are successful in our

Unity Software Inc.

performance and reduced customer satisfaction, resulting in decreased sales to new customers or lower dollar-based net expansion rates, which would hurt our revenue growth and our reputation.

Further, any failure in optimizing the costs associated with our third-party cloud services could negatively impact our gross margins.

Even if we are successful in our efforts to grow and expand, such efforts will be expensive and complex, and require the dedication of significant management time and attention.

efforts to grow and expand, such efforts will be expensive and complex, and require the dedication of significant management time and attention.

We may also suffer inefficiencies or service disruptions as a result of our efforts to scale our internal infrastructure.

Cost-cutting interventions and improvements to our internal infrastructure to offset expenses may not be effectively implemented on a timely basis, and such failures could harm our business, financial condition and results of operations.

If we fail to timely release updates and new features to our platform and adapt and respond effectively to rapidly changing technology, evolving industry standards, changing regulations, or changing customer needs, requirements, or preferences, our platform may become less competitive.

The markets in which we compete are subject to rapid technological change, evolving industry standards, and changing regulations, as well as changing customer needs, requirements and preferences.

The success of our business will depend, in part, on our ability to adapt and respond effectively to these changes on a timely basis.

For example, in the third quarter of 2024, we announced the launch of Unity 6 and we began a comprehensive rebuild of our machine learning stack and data infrastructure.

In the first quarter of 2025 we announced the roll out of our new machine-learning model, Vector.

If Unity 6 fails to gain market acceptance, or if we fail to execute on the rebuild and launch of our machine learning stack and data infrastructure, on a timely basis or at all, our business could be harmed.

Similarly, emerging technologies like artificial intelligence could impact the way that customers utilize our solutions as well as enhance the functionality of our solutions.

Accordingly, our ability to increase our revenue depends in large part on our ability to maintain, improve and differentiate our existing platform and introduce new functionality promptly and effectively.

We must continue to improve existing features and add new features and functionality to our platform in order to retain our existing customers and attract new ones.

For example, if the technology underlying our high-definition rendering pipeline or our graphics, animation and audio tools become obsolete or do not address the needs of our customers, our business would suffer.

In addition, if our investments in fundamental product enhancements do not increase performance in a sustainable manner, or fail to do so on the timelines we expect, then our revenue, particularly from our Grow Solutions, would be harmed.

Revenue growth from our offerings depends on our ability to continue to develop and offer effective features and functionality for our customers and to respond to frequently changing privacy and data security laws and regulations, policies, advancements in competing technologies, and end-user demands and expectations, which will require us to incur additional costs to implement.

Cost-cutting interventions and improvements to our internal infrastructure to offset expenses may not be effectively or timely implemented, and such failures could harm our business, financial condition and results of operations.

If we fail to timely release updates and new features to our platform, develop successful new products, or adapt and respond effectively to rapidly changing technology, or to changing customer needs, requirements, or preferences, our platform may become less competitive.

The markets in which we operate are subject to rapid technological change, changing customer needs, requirements and preferences, and are highly competitive.

The success of our business will depend, in part, on our ability to adapt and respond effectively to these changes and competitive pressures on a timely basis.

For example, in the first quarter of 2025 we rolled out our new machine learning model, Unity Vector, in our Grow Solutions business.

If we do not continue to improve our AI capabilities and data infrastructure, including Unity Vector, on a timely basis or at all, our business could be harmed.

Similarly, emerging technologies like AI are likely to impact the way that customers utilize our solutions, as well as enhance the functionality of our solutions.

Accordingly, our ability to retain and expand within our existing customers and attract new ones, and increase our revenue, depends in large part on our ability to maintain, improve and differentiate our existing platform and introduce new functionality promptly and effectively, as well as developing successful new product offerings.

Revenue growth from our offerings also depends on our ability to continue to respond to advancements in competing technologies, and end-user demands and expectations, which will require us to incur additional costs to implement.

If we do not continue to improve our platform with additional features and functionality in a timely fashion, or if intended improvements to our platform are ineffective or otherwise not well received by customers, our revenue could be adversely affected.

If we fail to deliver timely releases of our solutions that are ready for commercial use, release a new version, service, tool or update with material errors, or are unable to enhance our platform to keep pace with rapid technological and regulatory changes or respond to new offerings by our competitors, or if new technologies emerge that are able to deliver competitive solutions at lower prices, more efficiently, more conveniently or more securely than our solutions, or if new operating systems, gaming platforms or devices are developed and we are unable to support our customers' deployment of games and other applications onto those systems, platforms or devices, our business, financial condition and results of operations could be adversely affected.

If we fail to deliver timely releases of our solutions that are ready for commercial use, we release a version, service, tool or update with a material vulnerability, or other error, or we are unable to enhance our platform to keep pace with rapid technological changes or respond to new offerings by our competitors, or if new technologies emerge that are able to deliver competitive solutions at lower prices, more efficiently, more conveniently or more securely than our solutions, or if new operating systems, gaming platforms or devices are developed and we are unable to support our customers' deployment of games and other applications onto those systems, platforms or devices, our business, financial condition and results of operations could be adversely affected.

We are increasingly building AI into certain of our offerings, and issues raised by the use of, or failure to successfully use, AI in our offerings, or the use of AI by our customers and competitors may adversely affect our business, reputation, or financial results.

We are increasingly building AI into certain of our offerings, such as Unity Vector, our new machine learning model, our new Unity AI product line, which includes AI Assistant and AI Generators, which are currently in beta, and Unity Inference Engine (formerly Unity Sentis), which allows creators to embed an AI model in the Unity Runtime for their game or application, enhancing gameplay and other functionality.

AI Generators leverage both Unity-developed and third-party models for AI-driven assistance during creation.

With respect to third-party models, we do not control the data used to train such models or the specific outputs they generate;

we act as a conduit for customer requests and return the responses from those third-party models.

The datasets used to train third-party models may inadvertently include content that infringes intellectual property rights.

Because we do not control the training data or model weights of third-party models, we may be subject to liability or reputational harm if customers use outputs generated through our offerings that are alleged to infringe third-party intellectual property rights.

Unity-developed models are trained exclusively on directly-licensed or open-licensed data;

however, we rely on the accuracy and scope of those licenses as represented by the licensors, and if such representations are incorrect or incomplete, we could face claims that our training data included content used without proper authorization.

The outputs of both Unity-developed and third-party models may also inadvertently replicate protected content, resulting in potential claims of infringement.

We continue to advance machine

Unity Software Inc.

learning ("ML") algorithms in our Grow Solutions, which are designed to enable us to provide customers with better performance.

AI technologies are complex and rapidly evolving, and we face significant competition from other companies as well as an evolving regulatory landscape.

AI technologies, in particular generative AI and interactive chatbots, are subject to existing laws of various states and countries such as those regarding privacy, data security, and consumer protection, and the evolving regulatory landscape and our product development efforts may result in new or enhanced governmental or regulatory scrutiny, litigation, ethical concerns, or other complications that could adversely affect our business, reputation, or financial results.

AI technologies, including generative AI and interactive chatbots, are subject to existing laws of various states and countries such as those regarding privacy, data security, and consumer protection.

In particular, global AI regulatory frameworks remain highly uncertain, rapidly changing, and inconsistent across jurisdictions, and frequently have extraterritorial reach, and, as a result may apply to our AI offerings regardless of where they are developed or deployed.

For example, the EU AI Act sets out a risk-based framework, subjecting certain AI technologies to numerous compliance obligations, including transparency, conformity and risk assessment, monitoring and human oversight requirements, and noncompliance could lead to fines of up to 35 million Euros or 7% of our total worldwide annual turnover.

Certain provisions of the EU AI Act could require us to alter or restrict our use of AI both in features or products available to our users and in our systems that interact with our users.

In addition, certain U.S.

states have proposed, enacted, or are considering laws governing the development and use of AI technologies, such as the Colorado Artificial Intelligence Act, California Bot Disclosure Law, the Utah Artificial Intelligence Policy Act, and the California Consumer Privacy Act ("CCPA") regulations on automated decision-making technology.

Additionally, certain privacy and data security laws extend rights to consumers and regulate automated decision making in ways that may be incompatible with our use of AI/ML.

These obligations may make it harder for us to conduct our business using AI/ML, lead to litigation or regulatory fines or penalties, require us to change our business practices, retrain our AI/ML, delete our models, or prevent or limit our use of AI/ML.

For example, the Federal Trade Commission ("FTC") has required other companies to delete algorithms and models derived from or trained on allegedly unlawfully collected data, where it has alleged the company has violated privacy or consumer protection laws.

Governments are increasingly scrutinizing generative AI technologies for potential intellectual property and content-related harms, and any regulatory enforcement or litigation in this area could adversely affect our business, reputation, or financial results.

In addition, AI and ML models may create flawed, incomplete, or inaccurate outputs, some of which may appear correct.

This may happen if the inputs that the model relied on were inaccurate, incomplete or flawed (including if a bad actor "poisons" the AI/ML with bad inputs or logic), or if the logic of the AI/ML is flawed (a so-called "hallucination").

We may use AI/ML outputs to make certain decisions.

Due to these potential inaccuracies or flaws, the model could lead us to make decisions that could bias certain individuals or classes of individuals and adversely impact their rights.

Our AI-enabled technology could be used by an end user in a manner publicly perceived as controversial.

The foregoing can cause us to face adverse consequences, including reputational harm, competitive harm, customer loss or legal liability.

As these requirements continue to emerge or change, we may be required to modify, restrict, or disable certain AI features;

implement new technical, governance and other controls;

or incur significant compliance and operational costs.

Failure to anticipate or comply with evolving AI regulatory obligations could adversely affect our ability to develop and deliver AI-enabled offerings, reduce the competitiveness of our products, or negatively impact our business, reputation, or financial results.

The increasing use of AI and ML, including AI-driven automation tools, may enable customers to reduce their reliance on human developers, and therefore paid seat licenses, or otherwise circumvent usage- and seat-based licensing metrics by obfuscating the number of users accessing our products.

Any such shift could materially reduce demand for our core subscription-based products and adversely affect our revenues and business model.

Advances in AI and 2D and 3D content generation technologies may enable our customers to use AI to automate or replicate aspects of content, content creation, simulation, or runtime functionality

Unity Software Inc.

provided by our platform and solutions, and allow competitors to develop solutions that reduce the competitiveness of our platform and solutions.

Even where such activities are unauthorized or prohibited, our ability to prevent, detect, or stop it may be limited.

To the extent such advances reduce the need for our products, or otherwise disintermediate Unity from the content creation process, our business and financial condition could be materially adversely affected.

Market acceptance of AI technologies is uncertain, and we may allocate resources toward technologies or products that do not align with customer needs or achieve market acceptance, or are rapidly rendered obsolete.

We may be unsuccessful in product development efforts, or our competitors may use AI technologies more efficiently than we do and develop solutions that reduce the competitiveness of our product offerings.

We may also incur significant costs and may not achieve any significant revenue from these new offerings.

The performance or suitability of third-party models could change in ways that negatively affect the customer experience, and our reliance on third-party models may also limit our ability to differentiate our offerings or control cost and performance characteristics.

Any of these factors could adversely affect our business, reputation, or financial results.

If we are unable to retain our existing customers and expand their use of our platform, or attract new customers, our growth and operating results could be adversely affected, and we may be required to reconsider our growth strategy.

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Our marketing efforts may not be successful despite the resources we devote to them.

We derive a significant portion of our revenue from our Grow Solutions, and such revenue is primarily generated under a revenue-share or profit-share model.

Under such models, our customers depend on us as a source of their own revenue, which in some cases may represent a significant portion of their revenue.

Should customers lose confidence in the value or effectiveness of our Grow Solutions or if our Grow Solutions are less effective, consumption of these offerings could decline.

For example, our revenue growth in the first half of 2022 was negatively impacted by challenges with certain of our Grow Solutions that reduced the efficacy of such products.

We must continually add new features and functionality to our Grow Solutions to remain competitive and respond to our customers' needs, particularly in a competitive environment.

For example, in the third quarter of 2024 we began a comprehensive rebuild of our machine learning stack and data infrastructure.

And in the first quarter of 2025, we announced that we were beginning the roll out of our machine-learning model, Vector.

If we fail to execute on the rebuild of our machine learning stack and data infrastructure and our offerings, or if our improvements on those offerings such as Vector, fail to perform properly, our business could be harmed.

Our Grow Solutions customers rely on us to attract a broad range of advertisers to our platform to generate demand for their impressions through our offerings such as LevelPlay, Unity Ads, and Sonic.

If we are unable to also serve the needs of advertisers, they may reduce their consumption of our solutions and, because the advertising market is highly competitive, they may shift their business to other advertising solutions or supply paths, which could adversely affect our revenue.

In addition, macroeconomic factors like labor shortages, supply chain disruptions, and inflation continue to cause logistical challenges, increased input costs, and inventory constraints for advertisers.

We derive a significant portion of our revenue from our Grow Solutions, which is primarily generated under revenue-share or profit-share models.

Under these models, our customers depend on us as a source of their own revenue, which in some cases may represent a significant portion of their total revenue.

Should customers lose confidence in the value or effectiveness of our Grow Solutions, consumption of these offerings could decline.

Our Grow Solutions customers rely on us to attract a broad range of advertisers to our platform to generate demand for their impressions through our offerings, including Unity Ads.

If we are unable to also serve the needs of advertisers, they may reduce their consumption of our solutions and shift their business to other competitor advertising solutions or supply paths, which could adversely affect our revenue.

In addition, advertising spending is often adversely affected by macroeconomic factors like economic downturns and inflation.

These factors have in the past decreased, and may in the future decrease or halt, advertiser spending.

Our Grow Solutions are also dependent upon the continued proliferation of mobile connected devices, such as smartphones and tablets, as well as the increased consumption of content through those devices.

Consumer usage of these mobile connected devices may be inhibited for a number of reasons beyond our control.

If user adoption of mobile connected devices or user consumption of content on those devices do not continue to grow, our business could be harmed.

Create Solutions customers have no obligation to renew their subscriptions, which are primarily one to five years in length, after they expire, and have no obligation to continue using our Grow Solutions, which are primarily sold under revenue-share or profit-share-based models.

We periodically review our pricing structures and business models and in the third quarter of 2023 we announced changes to our pricing model for our Create Solutions, which were to become effective for users of the next major release of the software expected to be available in 2024.

We experienced a high volume of negative customer feedback including a boycott and a slowdown of signing new contracts and renewals as a result of these changes, which we believe negatively impacted our Grow Solutions revenue in the second half of 2023.

In light of this customer feedback, we reviewed our pricing structure and announced a new pricing structure during the third quarter of 2024.

Although this later announcement was favorably received, decisions to change how we price our products or services have been and may in the future be viewed unfavorably and harm our business.

For us to maintain or improve our results of operations, it is important that our Create Solutions customers renew and expand their subscriptions with us and that our Grow Solutions customers continue using and expanding their use of our solutions.

Our Grow Solutions are also dependent upon the continued proliferation of connected devices, such as smartphones, tablets and televisions, as well as the increased consumption of content through those devices.

Consumer usage of these devices may be inhibited for a number of reasons beyond our control.

If user adoption of connected devices or user consumption of content on those devices do not continue to grow, our business could be harmed.

For us to maintain or improve our results of operations, it is important that our customers continue using and expanding their use of our solutions.

Create Solutions customers have no obligation to renew their subscriptions, which are primarily for one to five years in length, after they expire, and our Grow Solutions, which are primarily sold under revenue-share or profit-share-based models.

We invest in targeted sales and account-based marketing efforts to identify opportunities to grow use of our solutions within and across multiple studios within a single customer.

However, our efforts may not be successful despite the resources we devote to them.

Even if one or several studios within a customer adopt our Create or Grow Solutions, other studios within

Even if one or several studios within a customer adopt our Create or Grow Solutions, other studios within that customer may choose to adopt different solutions or to continue to employ internally-developed solutions.

Further, consolidation or reorganization of studios within a customer may reduce opportunities to expand usage of our solutions across multiple studios.

In addition, we periodically review our fees, pricing structures and business models, and decisions to change how we price our products or services have been and may in the future be viewed unfavorably and harm our business.

Unity Software Inc.

that customer may choose to adopt different solutions or to continue to employ internally-developed solutions.

It is also important for us to cross-sell more Create Solutions to our Grow Solutions customers, as well as Grow Solutions to our Create Solutions customers.

While we believe there are significant cross-selling opportunities between our Create and Grow Solutions, and that our Create and Grow Solutions work together synergistically, our efforts to cross-sell may not be successful.

The markets in which we participate are competitive, and if we do not compete effectively, our business, financial condition, and results of operations could be harmed.

It is also important for us to cross-sell more Create Solutions to our Grow Solutions customers and vice versa.

While we believe there are significant benefits to our customers in using both our Create and Grow Solutions, our Create Solutions customers are under no obligation to use our Grow Solutions, and our efforts to cross-sell may not be successful.

If we fail to successfully execute our plans to reset our portfolio to focus on our Strategic Portfolio and to right-size our investments, our business will be harmed.

We have realigned our business to focus on the Unity Engine and related consumption services, and monetization solutions, and are continuing to exit other businesses and right-size our investments.

These efforts may not be effective or sufficient to offset our expenses, and may themselves have adverse impacts, such as loss of continuity or accumulated knowledge, limited technological support on legacy products, inefficiency during transitional periods, distraction, and potential challenges operating our business with fewer resources.

For example, in 2024 we reduced our employee workforce by approximately 25%, and various members of our management team departed from their operational roles and in 2025 we further reduced our employee workforce and continued to wind down certain non-strategic businesses.

The departure of employees may create a loss of accumulated knowledge, inefficiency, and other challenges to operating our business.

If we fail to efficiently execute on these plans to restructure, or if the benefits from these efforts are not achieved on the timeline or to the extent we expect, our business may be harmed and we may fail to achieve or maintain profitability.

The markets in which we participate are highly competitive, and if we do not compete effectively, our business, financial condition, and results of operations could be harmed.

The markets in which we operate are highly competitive.

Specifically, we have faced and may continue to face competition as a result of:

• increased costs for advertisers to target users due to changes in the privacy landscape;

• reduced supply from publishers, who may also use channels beyond in-app advertising to grow revenue;

• rapid technological change, such as the rise of AI and machine learning, increasing use of data and trained models, evolving industry standards, changing regulations, as well as changing customer needs, requirements and preferences;

• the internal development of alternative solutions by a significant number of companies, including other gaming companies;

• rapid technological change, such as the rise of AI, and machine learning and increasing use of data and trained models as well as changing customer needs, requirements and preferences;

• the impact of evolving industry standards and changing regulations, which may affect us differently than some our competitors, including, for example, increased costs for advertisers to target users due to changes in the data privacy landscape;

• reduced supply from game publishers, who may also use channels beyond in-app advertising to grow revenue;

• the development of alternative solutions by a significant number of companies, including other gaming and ad-tech companies;

• lower prices or free solutions offered by our competitors, some of whom may offer more favorable payment terms to publishers;

• mergers, acquisitions and other strategic relationships amongst our competitors which may allow them to provide more comprehensive offerings or achieve greater economies of scale than us, and may introduce new competitors in our markets;

• intense competition within the gaming market which may impact our company and a significant number of our customers, who also operate in the gaming market;

• the introduction of alternative solutions by larger, more experienced companies that offer 2D and 3D design solutions in the industries in which we may expand into.

Our competitors may have greater name recognition, longer operating histories, more established customer relationships, larger marketing budgets and greater financial and operational resources than we do.

• the introduction of alternative solutions by larger, more experienced companies that offer 2D and 3D design solutions in the industries in which we currently operate or may expand into;

Our competitors include other game development engines and platforms and large technology and ad-tech companies, many of which have greater name recognition, longer operating histories, more established customer relationships, larger marketing budgets and greater financial and operational resources than we do.

We cannot assure you that we will not be forced to engage in price-cutting or revenue limiting initiatives, change payment terms or increase our advertising and other expenses to attract and retain customers in response to competitive pressures.

For all of these reasons, we may not be able to compete successfully against our current or future competitors, which could result in the failure of our platform to continue to achieve or maintain market acceptance, which would harm our business, financial condition, and results of operations.

If we fail to successfully execute our plans to reset our portfolio to focus on our Strategic Portfolio and to right-size our investments, our business will be harmed.

We have reset our portfolio to focus on the Unity Engine and related consumption services, and Monetization solutions, exiting other businesses and right-sizing our investments.

These efforts may not be effective or sufficient to offset our expenses, and may themselves have adverse impacts, such as loss of continuity or accumulated knowledge, inefficiency during transitional periods, distraction, and potential challenges operating our business with fewer resources.

For example, in the first quarter of 2024 we reduced our employee workforce by approximately 25%, and certain members of our management team, including the ironSource founders, departed from their operational roles.

The departure of these employees may create a loss of accumulated knowledge, inefficiency, and other challenges to operating

Unity Software Inc.

our business.

If we fail to efficiently execute on these plans to restructure, or if the benefits from these efforts are not achieved on the timeline we expect, we may fail to achieve or maintain profitability.

Our estimates of market opportunity and forecasts of market growth may prove to be inaccurate, and even if the market in which we compete achieves the forecasted growth, our business could fail to grow at a similar rate, if at all.

Our estimates of market opportunity and forecasts of market growth may prove to be inaccurate.

Market opportunity estimates and growth forecasts, including those we have generated ourselves, are subject to significant uncertainty and are based on assumptions and estimates that may not prove to be accurate.

The variables that affect the calculation of our market opportunity are also subject to change over time.

We cannot assure you that any particular number or percentage of addressable users or companies covered by our market opportunity estimates will purchase our solutions at all or generate any particular level of revenue for us.

In addition, any expansion in our market depends on a number of factors, including the cost, performance and perceived value associated with our platform and those of our competitors.

Even if the market in which we compete meets the size estimates and growth we forecast, our business could fail to achieve a substantial share of this market or grow at a similar rate, if at all.

Our growth is subject to many risks and uncertainties.

Accordingly, the estimates of market opportunity or forecasts of market growth we have made and may make should not be taken as indicative of our future growth.

Operating system platform providers or application stores may change terms of service, policies or technical requirements applicable to us or our customers, which could adversely impact our business.

We and our customers are subject to the standard policies and terms of service of the operating system platforms on which we create, run and monetize applications and content, as well as policies and terms of service of the various application stores, such as the Apple App Store or Google Play Store, which make applications and content available to end users.

Each of these operating system platforms and stores has broad discretion to change and interpret its terms of service and policies.

Each may also change its fee structure, add fees associated with access to and use of its platform, alter how customers are able to advertise or monetize on their platform, change how the personal or other user information is made available to application developers on their platform, limit the use of personal information for advertising purposes or restrict how end users can share information on their platform or across other platforms.

In particular, operating system platform providers or application stores such as Apple or Google have in the past and may in the future change their technical requirements or policies in a manner that adversely impacts the way in which we or our customers offer solutions or collect, use, and share data from end-user devices.

Restrictions on our ability to collect and use data as desired could negatively impact our Create Solutions and Grow Solutions as well as our resource planning and feature development planning for our software.

For example, Google is continuing to develop their implementation of Android Privacy Sandbox, a set of technologies that will, when their use is mandated, alter the manner in which advertising is performed on Android devices, and which may impact our business.

The long-term impact of these and other future privacy, platform, and regulatory changes could increase application store fees to our customers, or have other impacts which could harm our business.

If we or our customers violate or are accused of violating these terms of service or policies, an operating system platform provider or application store could limit or discontinue our or our customers' access to its platform or store.

They could also limit or discontinue our access to its platform or store if it establishes more favorable relationships with one or more of our competitors or it determines that it is in their business interests to do so.

Any limitation on or discontinuation of our or our customers' access to any third-party platform or application store could adversely affect our business, financial condition, or results of operations.

Unity Software Inc.

If we are unable to further expand into new industries, or if our solutions for any new industry fail to achieve market acceptance, our growth and operating results could be adversely affected, and we may be required to reconsider our growth strategy.

Our growth strategy is based, in part, on expanding into new industries beyond gaming.

The market for interactive RT3D and 2D content in industries beyond gaming is still developing, and it is uncertain whether this market will develop as we expect, how rapidly it will develop and how much it will grow.

Our success in these markets will depend, to a substantial extent, on the widespread adoption of our platform as an alternative to existing solutions, such as traditional 2D and 3D modeling and rendering tools, or adoption by customers that are not currently using any software solutions.

In addition, some of our competitors are also our partners and/or customers.

We compete to various degrees on the basis of price, technical performance, product features, system compatibility, quality and sales and technical support.

These competitors may decide to stop buying our products, compete more aggressively with us, use technical capabilities to hinder the performance of our products, or use our products or the information they obtain about or derived from our products and technology to develop or improve their own competing solutions, which could materially and adversely affect our business, financial condition and results of operations.

If we are unable to compete successfully against our current or future competitors, it could result in the failure of our platform and products to continue to achieve or maintain market acceptance, which would harm our business, financial condition, and results of operations.

If we are unable to further expand into adjacent business areas or new industries, or if our solutions for any new business area or industry fail to achieve market acceptance, our growth and operating results could be adversely affected, and we may be required to reconsider our growth strategy.

Our growth strategy is based, in part, on expanding into new industries beyond gaming and adjacent product expansion.

For example, the market for interactive RT3D and 2D content in industries beyond gaming is still developing, and it is uncertain whether this market will develop as we expect, how rapidly it will develop and how much it will grow.

Our success in these markets will depend, to a substantial extent, on the widespread adoption of our products as an alternative to existing solutions, such as traditional 2D and 3D modeling and rendering tools, or adoption by customers that are not currently using any software solutions.

Market acceptance of our platform in industries beyond gaming may not grow as we expect and if our platform does not achieve widespread adoption in these other markets, our ability to grow our revenue may suffer.

In addition, the investments we make to grow our business by expanding into new industries will continue to increase our costs and operating expenses on an absolute basis.

We expect to invest in sales and marketing resources to develop and expand the use of our solutions by customers in these industries, and we will need to increase our sales and marketing, legal and compliance and other efforts as we seek to expand into new industries that require a different go-to-market strategy than the gaming industry.

These investments will occur in advance of our realization of significant revenue from such industries, particularly given that customers in these industries are typically enterprise customers with long contracting cycles, which will make it difficult to determine if we are allocating our resources effectively and efficiently.

If the revenue we derive from these investments is not sufficient to achieve a return on investment, our business and results of operations would suffer.

Similarly, the market for programmatic advertising and Connected TV ("CTV") solutions is highly competitive and evolving, and it is uncertain whether our expansion into these gaming-adjacent verticals will develop as we expect.

Our success will depend on our ability to compete with incumbent demand-side and supply-side advertising platforms, as well as the widespread adoption of our advertising technology by agencies and brands that have historically relied on traditional media or closed digital ecosystems.

Market acceptance of our solutions in these areas may be hindered by our ability to provide comparable scale, targeting, and transparent measurement relative to established competitors.

If our programmatic and CTV offerings do not achieve widespread adoption, or if we are unable to effectively capture advertising spend from outside of our core gaming audience, our ability to grow our revenue and diversify our business may suffer.

We are also expanding our In-App Purchase ("IAP") solutions, designed to support developers across a variety of alternative payment processing and monetization platforms.

The success of these offerings depends on our ability to maintain seamless technical integration with a variety of third-party payment service providers while ensuring compliance with the evolving requirements of major platform providers and complex regulatory requirements.

Platform providers may introduce new fee structures or technical hurdles relating to external payment flows that increase friction for users, reduce conversion rates, and diminish the economic benefit of our IAP offering to our customers.

If we cannot effectively manage these complexities, our ability to grow our payment processing-related revenue could be adversely affected.

The investments we make to expand into new or adjacent industries will continue to increase our costs and operating expenses on an absolute basis.

We expect to invest in sales and marketing resources to develop and expand the use of our solutions by customers in these industries, and we will need to increase our sales and marketing, legal and compliance and other efforts as we seek to expand into additional industries that often require a different go-to-market strategy than the gaming industry.

These investments may occur in advance of our realization of significant revenue from such industries, particularly in industries characterized by enterprise customers with long contracting cycles, which will make it difficult to determine if we are allocating our resources effectively and efficiently.

If the revenue we

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derive from these investments is not sufficient to achieve a return on investment, our business and results of operations would suffer.

Our business relies in part on strategic relationships.

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If any of these third parties were to suspend, limit or cease their operations or otherwise terminate their relationships with us, our results of operations could be adversely affected.

We have entered into separate agreements with each of our strategic partners.

Our agreements with our strategic partners are non-exclusive and typically have multi-year terms.

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Adverse events relating to our customers or their games could have a negative impact on our business.

Our gaming customers are not the end users of our solutions, but rather they use our platform and solutions to create and/or operate their games, which are ultimately sold or distributed to an end user.

Our gaming customers use our platform and solutions to create and/or operate their games, which are ultimately sold or distributed to an end user.

As a result, our success depends in part on the ability of our customers to market and sell games that are created or operated with our solutions.

If our customers' marketing efforts are unsuccessful or if our customers experience a decrease in demand for their games, sales of our Create Solutions and our Grow Solutions could be reduced.

The gaming market is characterized by intense competition, rapid technological change, increased focus by regulators, and economic uncertainty and, as such, there is no guarantee that any of our customers' games will gain any meaningful traction with end users.

If our customers' marketing efforts for their games are unsuccessful or if our customers experience a decrease in demand for their games, sales of our Create Solutions and our Grow Solutions could be reduced.

The gaming market is characterized by intense competition, rapid technological change, increased focus by regulators, and economic uncertainty, and there is no guarantee that any of our customers' games will gain any meaningful traction with end users.

While our large and diverse customer portfolio has helped to reduce the fluctuations in our Grow Solutions revenue as a whole resulting from the success of customers' games and the timing of game releases, we cannot assure you that the size and diversification of our customer portfolio will sufficiently mitigate this risk.

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customers fail to create or operate popular games using our platform, and we are not able to maintain a diversified portfolio of "winners and losers," our results of operations may be adversely affected.

We may fail to realize the possible platform advantages between our Create and Grow Solutions, or those advantages may take longer to realize than expected.

We believe that there are significant benefits and advantages that may be realized through leveraging our Create and Grow Solutions.

However, the efforts to realize these benefits and advantages is a complex process.

The full benefits of these advantages may not be realized as expected or may not be achieved within the anticipated time frame, or at all.

In addition, we may incur additional or unexpected costs in order to leverage the advantages of being a single platform designed to deliver value to developers across the entire lifecycle.

Failure to achieve these platform advantages could adversely affect our results of operations or cash flows, cause dilution to our earnings per share, and negatively impact our stock price.

Our results of operations have fluctuated in the past and are expected to fluctuate in the future, making it difficult to project future results, and if we fail to meet the expectations of securities analysts or investors with respect to our results of operations, our stock price, and the value of your investment could decline.

Our results of operations have fluctuated in the past and are expected to fluctuate in the future due to a variety of factors, many of which are outside of our control.

As a result, our past results may not be indicative of our future performance.

As a result, our past results may not be

Unity Software Inc.

indicative of our future performance.

In addition to the other risks described herein, factors that may affect our results of operations include the following:

• fluctuations in demand for, usage of, or pricing of our platform;

• changes in mix of solutions purchased by our customers;

• fluctuations in demand for, usage of, or pricing of our solutions;

• changes in the mix of solutions purchased by our customers;

• demand for our gaming customers' products and their ability to monetize those products, which in turn can have a significant impact on our revenue-share and consumption-based solutions;

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• market conditions and risks associated with the gaming industry, including the popularity, price and timing of release of games, changes in consumer demographics, the availability and popularity of other forms of entertainment, public tastes and preferences;

• timing of updates and new features on our platform;

• fluctuations or delays in purchasing decisions in anticipation of new solutions or enhancements by us or our competitors;

• timing of updates and new features on our platform, or the release of new product offerings and our investments to support these features and offerings;

• fluctuations or delays in purchasing decisions by customers in anticipation of new solutions or enhancements by us or our competitors;

• amount and timing of payment for operating expenses, particularly research and development and sales and marketing expenses, including commissions, many of which occur in advance of the anticipated benefits resulting from such expenses;

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• costs that we incur in order to comply with changing regulatory, tax or legal requirements, especially with respect to AI, privacy and security matters;

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• significant security breaches of, technical difficulties with or interruptions to the delivery and use of our platform.

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If our quarterly results of operations fall below the expectations of investors and securities analysts who follow our stock, the price of our common stock could decline substantially, and we could face costly lawsuits, including securities class action suits.

Third parties with whom we do business may be unable to honor their obligations to us or their actions may put us at risk.

We rely on third parties, including our strategic partners, for various aspects of our business, including deep technology collaborations, co-marketing, advertising partners, development services agreements, and revenue share arrangements.

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Operating system platform providers or application stores may change terms of service, policies or technical requirements applicable to us or our customers, which could adversely impact our business.

Each of these operating system platforms and stores has broad discretion to change and interpret its terms of service and policies.

Restrictions on our ability to offer solutions or collect and use data as desired could negatively impact our Create Solutions and Grow Solutions as well as our resource planning and feature development planning for our software.

Changes to their technical requirements or policies may adversely impact solutions that we may offer including, for example, our IAP solution, and could lead to increased compliance costs, higher effective fee structures for our clients, or increased technical friction that could degrade the user experience and efficacy of our offerings, and ultimately harm our business.

If we or our customers violate, or are accused of violating, these terms of service or policies—which are frequently subject to change and lack clear or consistent interpretation by the platform providers—an operating system platform provider or application store could limit or discontinue our or our customers' access to its platform or store.

Our business may also be harmed by inconsistent or non-uniform enforcement of these policies across our industry, which can create an unlevel playing field or sudden disruptions to our operations.

Furthermore, increased scrutiny of the industry by regulatory bodies may ultimately lead to more onerous regulatory frameworks (e.g., various upcoming application store accountability regulations) or fundamental shifts in how platform providers enforce their policies.

For example, regulatory actions involving competitors regarding potential policy violations may increase the likelihood of platform-wide crackdowns or more restrictive terms of service that could adversely affect our business, financial condition, or results of operations.

The actions of third parties with whom we do business may put our business and results of operations at risk.

We rely on third parties, including our strategic partners, for various aspects of our business, including deep technology collaborations, co-marketing, advertising partners, ad mediation services, ad attribution partners, development services agreements, and revenue share arrangements.

Their actions may put our business, reputation, and brand at risk.

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In addition, the failure of these third parties to provide adequate services and technologies, or the failure of the third parties to adequately maintain or update their services and technologies, could result in a disruption to our business operations.

Further, disruptions in the mobile application industry, financial markets, economic downturns, poor business decisions, or reputational harm may adversely affect our partners and may increase their propensity to engage in fraud or otherwise illegal activity which could harm our business reputation, and they may not be able to continue honoring their obligations to us, or we may cease our arrangements with them.

For example, we rely on ad attribution partners to accurately and reliably perform mobile measurement and attribute ad impressions.

Any failure of those services may result in a reduction in the number of ads attributed to our ad platform and a resulting reduction in our revenue and the revenue realized by our ad publishers.

Further, disruptions in the mobile application industry, financial markets, economic downturns, poor

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business decisions, or reputational harm may adversely affect our partners and may increase their propensity to engage in fraud or otherwise illegal or improper activity which could harm our business reputation, and they may not be able to continue honoring their obligations to us, or we may cease our arrangements with them.

Similarly, we rely on third-party mediation platforms, some of which operate or are affiliated with competing advertising networks, to access a significant amount of our advertising inventory.

Alternative arrangements and services may not be available to us on commercially reasonable terms or at all and we may experience business interruptions upon a transition to an alternative partner or vendor.

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Our direct sales force targets larger customers, and sales to these customers involve risks that may not be present or that are present to a lesser extent with respect to sales to smaller customers.

We utilize a direct sales organization to increase adoption within larger enterprise customers and to expand into new industries, such as automotive, where potential customers are typically larger

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organizations.

In particular, our success for our Grow Solutions depends in part on larger enterprise customers.

We utilize a direct sales organization to increase adoption within larger enterprise customers and to expand into new industries, where potential customers are typically larger organizations.

The success of our Grow Solutions also depends in part on larger enterprise customers.

Sales to larger customers involve risks that may not be present or that are present to a lesser extent with sales to smaller customers, such as longer sales cycles, more complex customer requirements, substantial upfront sales costs, and less predictability in completing some of our sales.

If we do not effectively expand our direct sales capabilities to address these industries effectively or develop effective sales and marketing strategies for those industries, or if we focus our efforts on non-gaming industries that end up being slow adopters of our platform and solutions, our ability to increase sales of our platform and solutions to industries and for use cases outside gaming will be adversely affected.

We provide service-level agreement commitments related to certain of our Create and Grow Solutions customers.

If we do not effectively expand our direct sales or technical capabilities to address these industries effectively or develop effective sales and marketing strategies for those industries, or if we focus our efforts on non-gaming industries that end up being slow adopters of our platform and solutions, our ability to increase sales of our platform and solutions to industries and for use cases outside gaming will be adversely affected.

We provide service-level agreement commitments related to certain of our customers.

If we fail to meet these contractual commitments, our business could be harmed.

Certain of our Create and Grow Solutions customers are entitled to service-level agreements commitments.

If we are unable to meet the stated service-level commitments, including failure to meet the uptime and response time requirements under our customer agreements, we could face terminations.

Certain of our customers are entitled to service-level agreements commitments.

If we are unable to meet the stated service-level commitments, including failure to meet the uptime and response time requirements under our customer agreements, we may be subject to significant financial and operational liabilities.

Beyond the risk of contract terminations or suspensions, failures to meet these obligations may require us to provide service credits, refunds, or other remediation.

In some instances, the cumulative cost of these remedies, combined with the operational resources required to remediate any underlying

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technical issues, could render specific customer deals or broader service offerings unprofitable.

Any service-level failures could also damage our reputation, which could also adversely affect our business, financial condition and results of operations.

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High-quality support is important for the retention of our existing customers and expanding their use of our platform.

The importance of these functions will increase as we expand our business, pursue new customers and seek to expand the use of our platform and solutions by enterprise customers in new industries outside of gaming.

The importance of these functions will increase as we expand our business, pursue new customers, offer new products and seek to expand the use of our platform and solutions, including by enterprise customers in new industries outside of gaming.

If we do not help our customers quickly resolve issues and provide effective ongoing support, our ability to maintain and expand our solution to existing and new customers could suffer, and our reputation with existing or potential customers could suffer.

Indemnity provisions in various agreements to which we are a party potentially expose us to substantial liability for infringement, misappropriation or other violation of intellectual property rights, data protection and other losses.

Our agreements with our customers and other third parties may include indemnification provisions under which we agree to indemnify or otherwise be liable for losses suffered or incurred as a result of certain claims relating to or arising from our software, services, platform, our acts or omissions under such agreements or other contractual obligations.

In some cases, the liability is not limited and we may still incur substantial liability related to such agreements, and we may be required to cease providing certain functions or features on our platform as a result of any such claims.

Even if we succeed in contractually limiting our liability, such limitations may not be enforceable.

Any dispute with a customer or other third party with respect to such obligations could have adverse effects on our relationship with such customer or other third party and other existing or prospective customers, reduce demand for our platform and adversely affect our business, financial conditions and results of operations.

In addition, our insurance may not be adequate to indemnify us for all liability that may be imposed on us or otherwise protect us from liabilities or damages with respect to claims, including claims on such matters as alleged compromises of customer data, which may be substantial.

Any such coverage may not continue to be available to us on acceptable terms or at all.

Our business could be disrupted by catastrophic events, including health pandemics, militarization, or war.

Our business could be disrupted by catastrophic events, including natural disasters, health pandemics, militarization, or war.

Any catastrophic event, including earthquake, fire, flood, tsunami or other weather event, power loss, telecommunications failure, software or hardware malfunction, cyber-attack, war or terrorist attack, explosion, or pandemic could impact our business.

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Our insurance coverage may not compensate us for losses that may occur in the event of an earthquake or other significant natural disaster.

In addition, certain of our operations could be impacted by

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militarization or war, discussed below.

If any disaster were to occur, our ability to operate our business at our facilities could be impaired and we could incur significant losses, require substantial recovery time and experience significant expenditures in order to resume operations.

If we are unable to develop adequate plans to ensure that our business functions continue to operate during and after a disaster and to execute successfully on those plans in the event of a disaster or emergency, our business would be harmed.

Conditions in Israel, including political unrest, militarization and war, have impacted and may further adversely affect our operations.

Because many of the operations of Grow Solutions are conducted in Israel, many of our employees, are located in Israel.

Political unrest, militarization, or continued war in Israel or the surrounding region has not materially impacted our operations as a whole, but has impacted our employee productivity in Israel, and may further adversely affect our business.

As a result of the evolving geopolitical situation, several hundred thousand Israeli military reservists were drafted into immediate military service.

While most reservists were released from active service, if a substantial number of our employees, or employees of our service providers in Israel are conscripted into military service on a prolonged basis, our operations and result of operations, particularly of our Grow Solutions, may be harmed.

In the event that our facilities in Israel or facilities of providers of critical services to our operations in Israel are damaged, our ability to deliver or provide solutions and services in a timely manner to meet our contractual obligations with customers, partners and vendors and otherwise meet users' expectations, and our ability to develop our solutions in order to be competitive, could be adversely affected.

In addition, we may incur significant costs in order to resume operations and we may be unable to develop or implement adequate plans to ensure continuity of business functions.

Our commercial insurance may not cover losses that may occur as a result of events associated with war and terrorism.

The Israeli government currently covers the reinstatement value of direct damages that are caused by terrorist attacks or acts of war, but we cannot assure you that such government coverage will be maintained or that it will sufficiently cover our potential damages.

Any losses or damages incurred by us could harm our business.

In addition, some countries may impose restrictions on doing business with Israel or companies with operations in Israel.

There have also been calls to boycott Israeli goods and services.

Such efforts may impact the operations of Grow Solutions and harm our business.

The intensity and duration of the war in the region are difficult to predict, as are its impacts on our business and operations that are conducted in Israel.

In addition, certain of our operations or those of our customers could be impacted by militarization, war and other geopolitical disputes, including any renewal of the recent conflict in and around Israel, where we have a significant number of employees, any escalation of hostilities or conflict between China and Taiwan, which could adversely impact availability of computing components and resources, any of which could adversely affect our results of operations and business condition.

Our current operations are and will continue to be global in scope, creating a variety of operational challenges.

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• maintaining our company culture, which emphasizes developing and launching new and innovative solutions and which we believe is essential to our business, across all of our offices globally and requires aligning our values across cultures and viewpoints;

• difficulty collecting accounts receivable and potential for longer payment cycles;

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• difficulty collecting accounts receivable and potential for longer payment cycles, including due to disruptions or delays in global payment operations, and international payments or money transfers resulting from trade restrictions or sanctions or banking processes and procedures adopted in response;

• increased reliance on resellers and other third parties for our global expansion;

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• burdens of complying with a variety of foreign laws, including costs associated with legal structures, accounting, statutory filings and tax liabilities;

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• differing and potentially more onerous labor regulations and practices, especially in Europe;

• challenges inherent in efficiently managing, and the increased costs associated with, an increased number of employees over large geographic distances, including the need to implement appropriate systems, policies, benefits, statutory equity requirements and compliance programs that are specific to each jurisdiction;

• changes in trade relations, particularly with China, regulations, laws or enforcement, including changes to export control restrictions, economic sanctions, and trade embargoes;

• challenges inherent in efficiently managing, and the increased costs associated with, having a geographically diverse workforce, including the need to implement appropriate systems, policies, benefits, statutory equity requirements and compliance programs that are specific to each jurisdiction;

• changes in trade relations, particularly between the U.S.

and China, regulations, laws or enforcement, including changes to export control restrictions, economic sanctions, and trade embargoes;

• difficulties in managing a business in new markets with diverse cultures, languages, customs, legal systems, alternative dispute systems, and regulatory systems;

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Foreign Corrupt Practices Act ("FCPA"), U.S.

bribery laws, the United Kingdom ("U.K.") Bribery Act, and similar laws and regulations in other jurisdictions;

bribery laws, the United Kingdom ("UK") Bribery Act, and similar laws and regulations in other jurisdictions;

• adverse tax burdens and foreign exchange controls that could make it difficult to repatriate earnings and cash.

If we invest substantial time and resources to grow our business in markets outside the U.S.

and are unable to do so successfully and in a timely manner, our business and results of operations will suffer.

We invest substantial time and resources to grow our business in markets outside the U.S.

and if we are unable to do so successfully and in a timely manner, our business and results of operations will suffer.

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certain claims relating to or arising from our software, services, platform, our acts or omissions under such agreements or other contractual obligations.

Even if we succeed in contractually limiting our liability, such limitations may not be enforceable.

Any such coverage may not continue to be available to us on acceptable terms or at all.

We are exposed to collection and credit risks, which could impact our operating results.

Our accounts receivable are subject to collection and credit risks, which could impact our operating results.

Our Create Solutions typically include upfront purchase commitments for a one- to three-year subscription, which may be invoiced over multiple reporting periods, increasing these risks.

Our Create Solutions typically include purchase commitments for a one- to three-year subscription, which may be invoiced over multiple reporting periods, increasing these risks.

We rely on payments from advertisers in order to pay our Grow Solutions customers their revenue earned from our monetization solutions.

We are generally obligated to pay our customers for revenue earned within a

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negotiated period of time, regardless of whether or not our advertisers have paid us on time, or at all.

While we attempt to negotiate a longer payment period with our customers and shorter periods for our advertisers, we are not always successful.

We are generally obligated to pay our customers for revenue earned within a negotiated period of time, regardless of whether or not our advertisers have paid us on time, or at all.

As a result, we can face a timing issue with our accounts payable on shorter cycles than our accounts receivable, requiring us to remit payments from our own funds, and accept the risk of bad debt.

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If we fail to adequately assess and monitor our credit risks, we could experience longer payment cycles, increased collection costs and higher bad debt expense, and our business, operating results and financial condition could be harmed.

Adverse developments affecting the financial services industry, such as actual events or perceived concerns involving liquidity, defaults or non-performance by financial institutions could adversely affect our financial condition and results of operations.

Actual events involving limited liquidity, defaults, non-performance or other adverse developments that affect financial institutions, transactional counterparties or the financial services industry generally, or concerns or rumors about any such events, have in the past and may in the future lead to market-wide liquidity problems.

Our access to funding sources in amounts adequate to finance or capitalize our current and projected future business operations could be significantly impaired by factors that affect us, or customers, the financial institutions with which we have arrangements directly, or the financial services industry or economy in general.

Any further deterioration in the macroeconomic economy or financial services industry could lead to losses or defaults by parties with whom we conduct business, which in turn, could have an adverse effect on our current and/or projected business operations and results of operations and financial condition.

For example, a party with whom we conduct business may fail to make payments when due, default under their agreements with us, become insolvent or declare bankruptcy.

Any bankruptcy or insolvency, or the failure to make payments when due, of any counterparty of ours, or the loss of any significant relationships, could result in losses to us and may adversely impact our business.

Fluctuations in currency exchange rates could harm our operating results and financial condition.

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We cannot be certain when or if our operations will generate sufficient cash to fully fund our ongoing operations or the growth of our business.

We intend to continue to make investments to support our business and may require additional funds to respond to business challenges, including the need to develop new solutions, products, services or enhance our existing solutions, products or services, enhance our operating infrastructure, expand globally and acquire complementary businesses and

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technologies.

Additional financing may not be available on terms favorable to us, if at all.

If adequate funds are not available on acceptable terms, we may be unable to invest in future growth opportunities, which could harm our business, operating results, and financial condition.

We intend to continue to make investments to support our business and may require additional funds to do so, including the need to develop new solutions, products, services or enhance our existing solutions, products or services, enhance our operating infrastructure, expand globally and acquire complementary businesses and technologies.

In addition, we may need to take other measures that would impact our liquidity.

For example, under certain conditions we may be required to repurchase the third-party interest in Unity China, which would impact our liquidity.

If we incur additional debt the debt holders would have rights senior to holders of common stock to make claims on our assets, and the terms of any debt could restrict our operations, including our ability to pay dividends on our common stock.

Furthermore, if we issue additional equity securities, stockholders will experience dilution, and the new equity securities could have rights senior to those of holders of our common stock.

Our inability to obtain adequate financing on terms satisfactory to us, when we require it, could significantly limit our ability to continue to support our business growth, respond to business challenges, expand our operations or otherwise capitalize on our business opportunities due to lack of sufficient capital.

Even if we are able to raise such capital, we cannot assure you that it will enable us to achieve better operating results or grow our business.

We may fail to realize the possible platform advantages between our Create and Grow Solutions, or those advantages may take longer to realize than expected.

We believe that there are significant benefits and advantages that may be realized through leveraging our Create and Grow Solutions.

However, the efforts to realize these benefits and advantages is a complex process.

The full benefits of these advantages may not be realized as expected or may not be achieved within the anticipated time frame, or at all.

In addition, we may incur additional or unexpected costs in order to leverage the advantages of being a single platform designed to deliver value to developers across the entire lifecycle.

Failure to achieve these platform advantages could adversely affect our results of operations or cash flows, cause dilution to our earnings per share, and negatively impact our stock price.

For example, under certain conditions

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we may be required to repurchase the third-party interest in our Unity China venture, which would impact our liquidity.

If we incur additional debt, new debt holders would have rights senior to holders of common stock to make claims on our assets, along with our existing creditors, and the terms of any such debt could significantly restrict our operations and other activities, including our ability to make investments, and repurchase our securities.

Furthermore, if we issue additional equity or convertible securities, existing stockholders will experience dilution, and the new securities could have rights senior to those of holders of our common stock.

Our inability to obtain adequate financing on terms satisfactory to us, or at all, when we require it, could significantly limit our ability to continue to support our business growth, respond to business challenges, expand our operations or otherwise capitalize on our business opportunities due to lack of sufficient capital, which could harm our business, operating results, and financial condition.

Even if we are able to raise such capital, it may not enable us to achieve better operating results or grow our business.

Risks Related to Our Platform and Technology

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Our platform can be complex to use, and our ability to expand the appeal of our platform depends in part on ensuring that it can be used by a variety of creators.

While certain features of our solutions are designed to address the needs of professional developers, we believe that our ability to expand adoption of our platform will depend in part on our ability to address the needs of creators with varied needs and levels of expertise, including artists, animators and sound technicians, as well as new categories of creators and end users in industries beyond gaming such as architects, civil and mechanical engineers, and designers.

Accordingly, it will be important to our future success that we continue to increase the accessibility of our platform and if we are not able to, our ability to increase adoption of our platform will suffer.

While certain features of our solutions are designed to address the needs of professional developers, we believe that our ability to expand adoption of our platform will depend in part on our ability to address the needs of creators with varied needs, preferences, and levels of expertise, as well as new categories of creators and end users in industries beyond gaming such as automotive, retail, manufacturing, healthcare, public sector, and robotics, architecture, civil and mechanical engineering, and design and construction.

If we fail to effectively integrate AI and advanced technologies to simplify our user experience and broaden our appeal to creators of varying expertise—including those in non-gaming industries—users may migrate to or adopt in the first instance more accessible solutions, and our business may be harmed.

Accordingly, it is important to our future success that we continue to increase the accessibility of our platform.

In order to get full use of our platform, users generally need training.

We provide a variety of training resources to our customers, and we believe we will need to continue to maintain and enhance the breadth and effectiveness of our training resources as the scope and complexity of our platform increase.

We provide a variety of training resources to our customers, and we will need to continue to maintain and enhance the breadth and effectiveness of our training resources as the scope and complexity of our platform increase.

Historically, most of our developers have been software engineers or have coding experience.

As we expand into other industries, we must successfully make our tools and training accessible to creators and users who may not have significant software engineering or coding experience, which means that we must adapt our training accordingly, to drive adoption of our products in these industries.

If we do not provide effective training resources for our customers on how to efficiently and effectively use our platform, our ability to grow our business will suffer, and our business and results of operations may be adversely affected.

Additionally, when we announce or release new versions of our platform or advancements in our technology, such as Unity 6, we could fail to sufficiently explain or train our customers on how to use such new versions or advancements or we may announce or release such versions prematurely.

Additionally, when we announce or release new versions of our platform or advancements in our technology, we could fail to sufficiently explain or train our customers on how to use such new versions or advancements or we may announce or release such versions prematurely.

These failures may lead to our customers being confused about use of our offerings or expected technology releases, and our ability to grow our business, results of operations, brand and reputation may be adversely affected.

For example, such failures have in the past led to customers expressing frustration with our platform on social media and other internet sites.

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Interruptions, performance problems, or defects associated with our platform may adversely affect our business, financial condition, and results of operations.

Our reputation and ability to attract and retain customers and grow our business depends in part on our ability to operate our platform at high levels of reliability, scalability and performance, including the ability of our existing and potential customers to access our platform at any time and within an acceptable amount of time.

Interruptions in the performance of our platform and solutions, whether due to system failures, computer viruses or physical or electronic break-ins, could affect the availability of our platform.

We have experienced, and may in the future experience, disruptions, outages and other performance problems due to a variety of factors, including infrastructure changes, introductions of new functionality, human or software errors, capacity constraints due to an overwhelming number of customers accessing our platform simultaneously, denial-of-service attacks or other security-related incidents.

It may become increasingly difficult to maintain and improve our performance, especially during peak usage times and as our customer base grows and our platform becomes more complex.

If our platform is unavailable or if our customers are unable to access our platform within a reasonable amount of time or at all, we may experience a loss of customers, lost or delayed market acceptance of our platform, delays in payment to us by customers, injury to our reputation and brand, legal claims against us, significant cost of remedying these problems and the diversion of our resources.

In addition, to the extent that we do not effectively address capacity constraints, upgrade our systems as needed and continually develop our technology and network architecture to accommodate actual and anticipated changes in technology, our business, financial condition and results of operations, as well as our reputation, may be adversely affected.

For example, due to heightened concerns about the regulatory environment with respect to privacy and security matters, our customers are increasingly requesting audit certifications, such as SOC 2, Type II, that we have not yet achieved with respect to some of our offerings.

Failure to achieve these certifications may adversely impact our ability to grow our business at the pace that may be expected by our investors.

Additionally, material interruptions to our service due to security-related incidents may expose us to regulatory fines in certain jurisdictions where we operate even in the absence of data loss.

Further, the software technology underlying our platform is inherently complex and may contain material defects or errors, particularly when new solutions are first introduced or when new features or capabilities are released.

We have from time to time found defects or errors in our platform, and new defects or errors in our existing platform or new solutions may be detected in the future by us or our users.

For example, in the first half of 2022, we experienced challenges with certain of our Grow Solutions (including a fault in our platform that resulted in reduced accuracy of one of our monetization tools, as well as the consequences of ingesting bad data from a large customer) that reduced the efficacy of such products.

We cannot assure you that our existing platform and new offerings will not contain defects.

Any real or perceived errors, failures, vulnerabilities, or bugs in our platform could result in negative publicity or lead to data security, access, retention or other performance issues, all of which could harm our business.

The costs incurred in correcting such defects or errors may be substantial and could harm our business.

Moreover, the harm to our reputation and legal liability related to such defects or errors may be substantial and could similarly harm our business.

We are increasingly building AI into certain of our offerings, and issues raised by the use of AI in our offerings may adversely affect our business, reputation, or financial results.

We are increasingly building AI into certain of our offerings, such as Vector, our new machine-learning model, Unity Muse, an expansive platform for AI-driven assistance during creation, and Unity Sentis, which allows creators to embed an AI model in the Unity Runtime for their game or application, enhancing gameplay and other functionality.

We continue to advance machine learning algorithms in our Grow Solutions, which are designed to enable us to provide customers with better performance.

AI technologies are complex and rapidly evolving, and we face significant competition from other companies as well as an evolving regulatory landscape.

The evolving regulatory landscape and our product development efforts may result in new or enhanced governmental or regulatory scrutiny, litigation, ethical

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concerns, or other complications that could adversely affect our business, reputation, or financial results.

For example, the use of datasets to develop and be referenced by AI models, the content generated by AI systems, or the application of AI systems may be found to be insufficient, offensive, biased, or harmful, or violate current or future laws and regulations or third-party rights.

In addition, AI and machine learning ("ML") models may create flawed, incomplete, or inaccurate outputs, some of which may appear correct.

If our technology is used by an end user in a controversial manner due to their perceived or actual impact on society, we may experience brand or reputational harm, competitive harm or legal liability.

In addition, market acceptance of AI technologies is uncertain, and we may be unsuccessful in product development efforts.

Our solutions that use AI could fail to achieve market acceptance, or our competitors may use AI technologies more efficiently than we do.

We may incur significant costs and may not achieve any significant revenue from these offerings.

Any of these factors could adversely affect our business, reputation, or financial results.

Such failures have in the past led to customers expressing frustration with our platform on social media and other internet sites.

If we or the third parties with whom we work experience a security breach or unauthorized parties otherwise obtain access to our customers' data, our data, or our platform, our platform may be perceived as not secure, our reputation may be harmed, our business operations may be disrupted, demand for our solutions may be reduced, and we may incur significant liabilities.

Operating our business and platform involves the collection, processing, storage and transmission of sensitive, proprietary and confidential information, including personal information of our personnel, customers and their end users, our proprietary and confidential information and the confidential information we collect from our partners, customers and creators.

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customers and their end users, our proprietary and confidential information and the confidential information and confidential intellectual property we collect from our partners, customers and creators.

Cyber-attacks, malicious internet-based activity, online and offline fraud, and other similar activities threaten the confidentiality, integrity, and availability of our sensitive information and information technology systems, and those of the third parties with whom we work.

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Extortion payments may alleviate the negative impact of a ransomware attack, but we may be unwilling or unable to make such payments due to, for example, applicable laws or regulations prohibiting payments.

Our security measures could also be

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compromised by personnel, theft or errors, and have been in the past and may in the future be insufficient to prevent harm resulting from security vulnerabilities in software or systems on which we rely.

Our security measures could also be compromised by personnel, theft or errors, and have been in the past and may in the future be insufficient to prevent harm resulting from security vulnerabilities in our platform or the software or systems on which we rely.

Additionally, our remote workforce poses increased risks to our IT assets and data.

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Furthermore, we may discover security issues that were not found during due diligence of such acquired or integrated entities, and it may be difficult to integrate companies into our information technology environment and security program.

Additionally, our or our customers' sensitive, proprietary, or confidential information could be leaked, disclosed, or revealed as a result of or in connection with our employees', personnel's, or vendors' use of generative AI technologies.

Any such information that we input into a third-party generative AI or ML platform could be revealed to others, including if information is used to train the third party's AI/ML models.

Additionally, where an AI/ML model ingests personal information and makes connections using such data, those technologies may reveal other sensitive, proprietary, or confidential information generated by the model.

Moreover, AI/ML models may create incomplete, inaccurate, or otherwise flawed outputs, some of which may appear correct.

We may use AI/ML outputs to make certain decisions.

Due to these potential inaccuracies or flaws, the model could lead us to make decisions that could bias certain individuals or classes of individuals and adversely impact their rights.

As a result, we could face adverse consequences, including exposure to reputational and competitive harm, customer loss, and legal liability.

Such incidents have occurred in the past, and may occur in the future, resulting in unauthorized, unlawful or inappropriate access to, inability to access, disclosure of or loss of the sensitive, proprietary and confidential information that we handle.

We take steps designed to detect, mitigate, and remediate vulnerabilities in our information security systems, but we have not always been, and may in the future not be, able to detect, mitigate, and remediate all such vulnerabilities.

As one example, like many companies, we use Log4j with respect to certain software or systems to log security and performance information.

A vulnerability in Log4j was discovered in late 2021 and widely exploited by threat actors, and, upon learning of this vulnerability, we made updates to our offerings and infrastructure intended to reduce risks associated with the vulnerability.

Investigations into potential incidents occur as part of our security program.

We take steps designed to detect, mitigate, and remediate vulnerabilities in our information security systems, platform, and solutions.

Investigations into potential incidents and insecure configurations of our services and the software we use are also an integral part of our security program.

For example, we detected through our bug bounty program a vulnerability in our product that we released patched versions for in October 2025.

However we have not always been, and may in the future not be, able to detect, mitigate, and remediate all such vulnerabilities.

Moreover, we have experienced and may in the future experience delays in developing and deploying remedial measures and patches designed to address any identified vulnerabilities.

Security incidents could also damage our IT systems, our ability to provide our products and services, and our ability to make the financial reports and other public disclosures required of public companies.

Any such remediation or patching may also be costly, difficult or impractical to implement.

This is especially the case where there are multiple platforms or third-party partners involved and/or there is a lack of cooperation from other parties necessary for remediation.

Security incidents could also damage our IT systems, our ability to provide our products and services, and our ability to

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make the financial reports and other public disclosures required of public companies.

Additionally, vulnerabilities in our products may cause reputational harm resulting in customer loss, and it also may lead to legal liability if such vulnerabilities are exploited before we are able to release patches.

Threat actors have used, and may in the future use, an initial compromise of one part of our environment to gain access to other parts of our environment, or to try to leverage a compromise of our networks or systems to gain access to the networks or systems of third parties with whom we work.

They may also try to leverage potential vulnerabilities or other information in our platform or code for future attacks.

We rely on third parties to provide critical services that help us deliver our solutions and operate our business.

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Our ability to monitor these third parties' information security practices is limited and these third-party providers may not have adequate security measures, and have experienced and could experience in the future security incidents that compromise the confidentiality, integrity or availability of the systems they operate for us or the information they process on our behalf.

Supply chain attacks are increasing in frequency, and we cannot guarantee that third parties' infrastructure in our supply chain or that of the third parties with whom we work have not been compromised.

Certain of our third party suppliers have experienced and may in the future experience attacks that could impact us.

Such occurrences could adversely affect our business to the same degree as if we had experienced these occurrences directly and we may not have recourse to the responsible third parties for the resulting liability we incur.

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For example, our customers are responsible for implementing multi-factor authentication to access their accounts.

In certain cases where our customers choose not to implement, or incorrectly implement, those features or measures, misuse

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our services, or otherwise experience their own vulnerabilities, policy violations, credential exposure or security breaches, even if we are not the cause of a resulting customer security issue or incident, our customer relationships reputation, and revenue may be adversely impacted.

In certain cases where our customers choose not to implement, or incorrectly implement, those features or measures, misuse our services, or otherwise experience their own vulnerabilities, policy violations, credential exposure or security breaches, even if we are not the cause of a resulting customer security issue or incident, our customer relationships reputation, and revenue may be adversely impacted.

Because there are many different cybercrime and hacking techniques and such techniques continue to evolve, we have in the past been and may in the future be unable to anticipate attempted security breaches, react in a timely or effective manner or implement adequate preventative measures.

While we have developed systems and processes designed to protect the integrity, confidentiality and security of our and our customers' confidential, proprietary, and personal information under our control or under the control of third parties with whom we work, we cannot assure you that any security measures that we or our third-party service providers have implemented has been or will in the future be effective against current or future security threats.

Security breaches and other incidents have occurred in the past, and may occur in the future, resulting in unauthorized, unlawful or inappropriate access to, inability to access, disclosure of or loss of sensitive, proprietary or confidential information.

A security breach or other security incident, or the perception that one has occurred, could result in a loss of customer confidence in the security of our platform and damage to our reputation and brand, reduce demand for our solutions, disrupt normal business operations, require us to incur material costs to investigate and remedy the incident and prevent recurrence, expose us to litigation, regulatory enforcement action, fines, penalties and damages and adversely affect our business, financial condition and results of operations.

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We have contractual and legal obligations to notify relevant stakeholders of security breaches or to take other actions, such as providing credit monitoring and identifying theft protection services.

Most jurisdictions have enacted laws requiring companies to notify individuals, regulatory authorities and others of security breaches involving certain types of data.

Most jurisdictions have enacted laws requiring companies to notify individuals, regulatory authorities and others

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of security breaches involving certain types of data.

In addition, our agreements with certain customers and partners may require us to notify them in the event of a security breach.

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Any increase in these costs will adversely affect our business, financial condition and results of operations.

Our business depends on the interoperability of our solutions across third-party platforms, operating systems, and applications, and on our ability to ensure our platform and solutions operate effectively on those platforms.

If we are not able to integrate our solutions with third-party platforms in a timely manner, our business may be harmed.

One of the most important features of our platform and solutions is broad interoperability with a range of diverse devices, operating systems and third-party applications.

Our customers rely on our solutions to create and simultaneously deploy content to a variety of third-party platforms.

Similarly, we and our customers also rely on our solutions' interoperability with third-party platforms in order to deliver

Interruptions, performance problems, or defects associated with our platform may adversely affect our business, financial condition, and results of operations.

Our reputation and ability to attract and retain customers and grow our business depend in part on our ability to operate our platform at high levels of reliability, scalability and performance, including the ability of our existing and potential customers to access our platform at any time and within an acceptable amount of time.

Interruptions in the performance of our platform and solutions, whether due to system failures, computer viruses or physical or electronic break-ins, could affect the availability of our platform.

It may become increasingly difficult to maintain and improve our performance, especially during peak usage times and as our customer base grows and our platform becomes more complex.

If our platform is unavailable or difficult to update, or our solutions are difficult or time-consuming to update or if our customers are unable to access our platform within a reasonable amount of time or at all, we may experience a loss of customers, lost or delayed market acceptance of our platform, delays in payment to us by customers, injury to our reputation and brand, legal claims against us, significant costs of remedying these problems and the diversion of our resources.

Failure to achieve these certifications may adversely impact our ability to grow our business at the pace that may be expected by our investors.

Additionally, material interruptions to our service due to security-related incidents may expose us to regulatory fines in certain jurisdictions where we operate even in the absence of data loss.

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Currently, we support and have strategic partnerships with over 20 such platforms.

Third-party platforms are constantly evolving, and we may not be able to modify our solutions to assure compatibility with that of other third parties following development changes within a timely manner.

For example, third-party platforms frequently deploy updates to their hardware or software and modify their system requirements.

The success of our business depends on our ability to incorporate these updates to third-party licensed software into our technology, effectively respond to changes to device and operating system platform requirements, and maintain our relationships with third-party platforms.

Our success also depends on our ability to simultaneously manage solutions on multiple platforms and our ability to effectively deploy our solutions to an increasing number of new platforms.

Given the number of platforms we support, it can be difficult to keep pace with the number of third-party updates that are required in order to provide the interoperability our customers demand.

If we fail to effectively respond to changes or updates to third-party platforms that we support, our business, financial condition, and results of operations could be harmed.

We rely upon third-party data centers and providers of cloud-based infrastructure to host our platform.

Any disruption in the operations of these third-party providers, limitations on capacity or interference with our use could adversely affect our business, financial condition, and results of operations.

We currently serve our users from co-located data centers in the U.S.

We also use various third-party cloud hosting providers such as Google Cloud, AWS, Azure, and Tencent to provide cloud infrastructure for our platform.

Our Create Solutions and Grow Solutions rely on the operations of this infrastructure.

Customers need to be able to access our platform at any time, without interruption or degradation of performance, and we provide some customers with service-level commitments with respect to uptime.

In addition, our Grow Solutions and enterprise game server hosting depend on the ability of these data centers and cloud infrastructure to allow for our customers' configuration, architecture, features and interconnection specifications and to secure the information stored in these data centers.

Any limitation on the capacity of our data centers or cloud infrastructure could impede our ability to onboard new customers or expand the usage of our existing customers, host our solutions or serve our customers, which could adversely affect our business, financial condition and results of operations.

In addition, any incident affecting our data centers or cloud infrastructure that may be caused by cyber-attacks, natural disasters, fire, flood, severe storm, earthquake, power loss, outbreaks of contagious diseases, telecommunications failures, terrorist or other attacks and other similar events beyond our control could negatively affect the cloud-based portion of our platform.

A prolonged service disruption affecting our data centers or cloud-based services for any of the foregoing reasons would negatively impact our ability to serve our customers and could damage our reputation with current and potential customers, expose us to liability, cause us to lose customers or otherwise harm our business.

We may also incur significant costs for using alternative providers or taking other actions in preparation for, or in response to, events that damage the third-party hosting services we use.

In the event that our service agreements relating to our data centers or cloud infrastructure are terminated, or there is a lapse of service, elimination of services or features that we utilize, interruption of internet service provider connectivity or damage to such facilities, we could experience interruptions in access to our platform, loss of revenue from revenue-share and consumption-based solutions, as well as significant delays and additional expense in arranging or creating new facilities and services or re-architecting our platform for deployment on a different data center provider or cloud infrastructure service provider, which could adversely affect our business, financial condition and results of operations.

We have from time to time found defects, errors or vulnerabilities in our platform and solutions, and new ones may be detected in the future by us or our users.

For example, we announced and remediated a vulnerability in our platform in October 2025.

We cannot assure you that our existing platform and new offerings will not contain defects or vulnerabilities or that they will not be exploited.

The costs incurred in correcting such defects.

errors or vulnerabilities may be substantial and could harm our business.

Such errors, defects and vulnerabilities often also require remediation efforts by our customers and other partners.

Moreover, the harm to our reputation and legal liability we may incur related to such occurrences may be substantial and could similarly harm our business and adversely affect our results of operations and financial condition.

Any failure to obtain, maintain, protect or enforce our intellectual property and proprietary rights could impair our ability to protect our proprietary technology and our brand.

Our success depends to a significant degree on our ability to obtain, maintain, protect and enforce our intellectual property rights, including our proprietary technology, know-how and our brand.

The steps we take to obtain, maintain, protect and enforce our intellectual property rights may be inadequate.

Our success depends to a significant degree on our ability to obtain, maintain, protect and enforce our intellectual property rights, including our proprietary technology, know-how and our brand, and we may not be able to adequately do so.

We will not be able to protect our intellectual property rights if we are unable to enforce our rights or if we do not detect unauthorized use of our intellectual property rights.

If we fail to protect our intellectual property

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rights adequately, or fail to continuously innovate and advance our technology, our competitors could gain access to our proprietary technology and develop and commercialize substantially identical products, services or technologies.

If we fail to protect our intellectual property rights adequately, or fail to continuously innovate and advance our technology, our competitors could gain access to our proprietary technology and develop and commercialize substantially identical products, services or technologies.

In addition, defending our intellectual property rights might entail significant expense.

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Accordingly, despite our efforts, we may be unable to prevent third parties from infringing upon, misappropriating or otherwise violating our intellectual property rights.

We enter into confidentiality and invention assignment agreements with our employees and consultants and enter into confidentiality agreements with other third parties, including suppliers and other partners.

We enter into confidentiality and invention assignment agreements with our employees and consultants and enter into confidentiality agreements with other third parties, including suppliers and other

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However, we cannot guarantee that we have entered into such agreements with each party that has or may have had access to our proprietary information, know-how and trade secrets or that has or may have developed intellectual property in connection with their engagement with us.

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Further, our efforts to enforce our intellectual property rights may be met with defenses, counterclaims and countersuits attacking the validity and enforceability of our intellectual property rights, and if such defenses, counterclaims or countersuits are successful, we could lose valuable intellectual property rights.

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impair the functionality of our platform, delay introductions of new solutions, result in our substituting inferior or more costly technologies into our offerings, or injure our reputation.

We license and make available software to customers.

Although those customers are restricted in the manner in which they can use and share our software, we cannot assure you that unauthorized use or copying of our software will not occur.

We rely on periodic significant updates to our software to encourage our customers to access our software through us on a paying or, for qualified users, non-paying, basis.

Our inability to enforce our unique licensing structure, including financial eligibility tiers, and our inability to protect our proprietary technology against unauthorized copying or use, including circumvention of licensing or usage restrictions as well as any costly litigation or diversion of our management's attention and resources, could delay further sales or the implementation of our solutions, impair the functionality of our platform, delay introductions of new solutions, result in our substituting inferior or more costly technologies into our offerings, or injure our reputation.

We license and make available software and source code to customers.

Although those customers are restricted in the manner in which they can use and share our software, we cannot assure you that unauthorized use or copying of our software or source code will not occur.

Such copying and use has occurred in the past, and while we actively take steps to stop this activity, we may not always be successful.

We also rely on periodic significant updates to our software to encourage our customers to access our software through us on a paying or, for qualified users, non-paying, basis.

However, we cannot assure you that this strategy will be effective in ensuring that users are not circumventing licensing or usage restrictions or otherwise misusing or accessing our software on an unauthorized basis.

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Such disputes and intellectual property litigation can be time-consuming and expensive to resolve and they divert management's time and attention.

Companies in the internet, technology and gaming industries own large numbers of patents, copyrights, trademarks, domain names and trade secrets and frequently enter into litigation based on allegations of infringement, misappropriation or other violations of intellectual property or other rights.

As we face increasing competition and gain a higher profile, the possibility of intellectual property rights and other claims against us grows.

Companies in the internet, technology and gaming industries own large numbers of patents, copyrights, trademarks, domain names and trade secrets and frequently litigate allegations of infringement, misappropriation or other violations of intellectual property or other rights.

Our technologies may not be able to withstand any third-party claims against their use.

In addition, many companies have the capability to dedicate substantially greater resources to enforce their intellectual property rights and to defend against claims that may be brought against them.

In addition, many

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companies have the capability to dedicate substantially greater resources to enforce their intellectual property rights and to defend against claims that may be brought against them.

Any litigation may also involve patent holding companies or other adverse patent owners that have no relevant product revenue, and therefore, our patents and patent applications may provide little or no deterrence as we would not be able to assert them against such entities or individuals.

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• obtain a license, which may not be available on reasonable terms or at all, to sell or use the relevant technology;

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• redesign or rebrand the allegedly infringing solutions to avoid infringement, misappropriation or violation, which could be costly, time-consuming or impossible.

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Litigation could be costly for us to defend, or require us to devote additional research and development resources to change our solutions, either of which could harm our business.

In addition, although we employ open source software license screening measures, if we were to combine our proprietary software solutions with certain open source software in a particular manner we could, under certain open source licenses, be required to release the source code of our proprietary software solutions.

Some open source projects have known vulnerabilities and architectural instabilities and are provided on an "as-is" basis which, if not properly addressed, could negatively affect the performance of our solution.

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addition, although we employ open source software license screening measures, if we were to combine our proprietary software solutions with certain open source software in a particular manner we could, under certain open source licenses, be required to release the source code of our proprietary software solutions.

If we inappropriately use or incorporate open source software subject to certain types of open source licenses that challenge the proprietary nature of our solutions, we may be required to re-engineer such solutions, discontinue the sale of such solutions or take other remedial actions.

If we are not able to integrate our solutions with third-party platforms in a timely manner, our business may be harmed.

One of the most important features of our platform and solutions is broad interoperability with a range of diverse devices, operating systems and third-party applications.

Our customers rely on our solutions to create and simultaneously deploy content to a variety of third-party platforms.

Similarly, we and our customers also rely on our solutions' interoperability with third-party platforms in order to deliver services.

Currently, we support over 25 such platforms.