What changed in this filing

/stocks — the workspaceLOADING

Item 8. Financial Statements and Supplementary Data

2026-02-11 compared with 2025-02-21 · 177 added, 180 removed, 824 unchanged (30% of the section changed)

69 unchanged sentences

Deferred revenue 224,405 186,304

Current portion of convertible notes 556,451 —

Total current liabilities 1,525,872 889,487

38 unchanged sentences

Net loss ( 401,493 ) ( 664,287 ) ( 826,322 )

Net loss attributable to noncontrolling interest and redeemable noncontrolling interests ( 173 ) ( 4,311 ) ( 1,296 )

Adjustments attributable to redeemable noncontrolling interests — — 2,870

Net income (loss) attributable to noncontrolling interest and redeemable noncontrolling interests 1,272 ( 173 ) ( 4,311 )

Net loss attributable to Unity Software Inc.

13 unchanged sentences

Change in foreign currency translation adjustment 9,201 ( 5,544 ) ( 4,556 )

Change in unrealized gains (losses) on short-term investments — — 969

Change in unrealized gains on derivative instruments — — 289

1 unchanged sentence

Comprehensive loss $ ( 392,292 ) $ ( 669,831 ) $ ( 830,589 )

Net loss attributable to noncontrolling interest and redeemable noncontrolling interests ( 173 ) ( 4,311 ) ( 1,296 )

Net income (loss) attributable to noncontrolling interest and redeemable noncontrolling interests 1,272 ( 173 ) ( 4,311 )

Foreign currency translation attributable to noncontrolling interest and redeemable noncontrolling interests 1,932 ( 1,128 ) ( 949 )

14 unchanged sentences

Issuance of common stock for settlement of RSUs 11,944,558 — — — — — — —

Common stock issued in connection with acquisitions 112,716,696 — 2,932,228 — — 2,932,228 — 2,932,228

Purchase and retirement of common stock ( 7,558,415 ) — ( 250,000 ) — — ( 250,000 ) — ( 250,000 )

Stock‑based compensation expense — — 664,853 — — 664,853 — 664,853

Capital contribution from minority interest holder — — 7,380 — — 7,380 6,387 13,767

Net loss — — — — ( 822,011 ) ( 822,011 ) ( 294 ) ( 822,305 )

Adjustments to redeemable noncontrolling interest — — ( 11,135 ) — — ( 11,135 ) — ( 11,135 )

Other comprehensive income — — — 2,167 — 2,167 — 2,167

Other comprehensive loss — — — ( 3,318 ) — ( 3,318 ) ( 65 ) ( 3,383 )

Balance at December 31, 2023 384,871,561 $ 2 $ 6,259,479 $ ( 5,009 ) $ ( 3,071,830 ) $ 3,182,642 $ 5,939 $ 3,188,581

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Issuance of common stock for settlement of RSUs 14,568,665 — — — — — — —

Purchase and retirement of common stock ( 7,558,415 ) — ( 250,000 ) — — ( 250,000 ) — ( 250,000 )

Stock‑based compensation expense — — 605,909 — — 605,909 — 605,909

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Common Stock Paid‑In Comprehensive Accumulated Stockholders’ Noncontrolling Total

Shares Amount Capital Loss Deficit Equity Interest (1)

Shares Amount Capital Loss Deficit Equity Interest (1) Equity

Balance at December 31, 2024 409,392,524 $ 2 $ 6,936,038 $ ( 9,425 ) $ ( 3,735,944 ) $ 3,190,671 $ 5,850 $ 3,196,521

1 unchanged sentence

Issuance of common stock for settlement of RSUs 13,089,091 — —

Purchase of capped calls ( 44,436 ) ( 44,436 ) ( 44,436 )

Stock‑based compensation expense 386,263 386,263 386,263

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Adjustments to redeemable noncontrolling interest ( 19,024 ) ( 19,024 ) ( 19,024 )

Other comprehensive loss — — — ( 4,416 ) — ( 4,416 ) ( 77 ) ( 4,493 )

Other comprehensive income 7,269 7,269 132 7,401

Balance at December 31, 2025 432,859,941 $ 2 $ 7,378,295 $ ( 2,156 ) $ ( 4,138,709 ) $ 3,237,432 $ 6,068 $ 3,243,500

9 unchanged sentences

Net loss $ ( 401,493 ) $ ( 664,287 ) $ ( 826,322 )

Adjustments to reconcile net loss to net cash provided by (used in) operating activities:

Adjustments to reconcile net loss to net cash provided by operating activities:

Depreciation and amortization 460,944 408,980 563,916

12 unchanged sentences

Deferred revenue 33,822 11,194 ( 128,219 )

Net cash provided by (used in) operating activities 315,553 234,700 ( 59,431 )

Net cash provided by operating activities 422,955 315,553 234,700

Investing activities

Purchases of short-term investments — — ( 212 )

Proceeds from sales of short-term investments — — 436,293

Proceeds from principal repayments and maturities of short-term investments — — 102,673

Purchases of non-marketable investments ( 2,000 ) — ( 2,500 )

Sales of non-marketable investments — — 1,000

Purchases of intangible assets ( 3,000 ) ( 12,860 ) —

Purchases of property and equipment ( 19,024 ) ( 29,549 ) ( 55,921 )

Business acquisitions, net of cash acquired — — 121,531

Net cash provided by (used in) investing activities ( 24,024 ) ( 42,409 ) 44,040

1 unchanged sentence

Proceeds from issuance of convertible notes 690,000 — —

Purchase of capped calls ( 44,436 ) — —

Payment of debt issuance costs ( 13,236 ) — —

Capital contribution from noncontrolling interest holders — — 210,252

Repayments of convertible note ( 641,691 ) ( 414,999 ) —

Repurchase and retirement of common stock — — ( 250,000 )

Proceeds from issuance of common stock from employee equity plans 76,692 75,985 63,493

Net cash used in financing activities ( 338,307 ) ( 174,015 ) ( 226,634 )

Proceeds from issuance of common stock upon exercise of stock options and purchase of ESPP shares 119,454 76,692 75,985

Net cash provided by (used in) financing activities 110,091 ( 338,307 ) ( 174,015 )

Effect of foreign exchange rate changes on cash, cash equivalents, and restricted cash 27,398 ( 11,223 ) ( 6,146 )

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Supplemental disclosures of non‑cash investing and financing activities:

Fair value of common stock issued as consideration for business and asset acquisitions $ — $ — $ 2,932,296

Assets acquired under operating lease $ 18,555 $ 24,459 $ 43,831

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Description of Business

We offer a suite of tools across all major platforms from mobile, PC, and console, to extended reality.

We are headquartered in San Francisco, California and have operations in the United States, Denmark, Israel, Canada, China, Finland, India, Japan, Lithuania, Singapore, South Korea, the U.K., and the United Arab Emirates.

We offer a suite of tools across all major platforms from mobile, PC, and console, to extended reality (XR).

We are headquartered in San Francisco, California and have operations in the United States and various other international locations.

We market our solutions directly through our online store and field sales operations in North America, China, France, the U.K., Israel, Japan, and South Korea, and indirectly through independent distributors and resellers worldwide.

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The preparation of consolidated financial statements in conformity with GAAP requires management to make certain estimates, judgments, and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, as well as the reported amounts of revenue and expenses during the reporting period.

For us, these estimates are used for, but not limited to, revenue recognition, the measurement of liabilities for uncertain tax positions and deferred tax assets and liabilities, the fair value of stock-based compensation, the fair value of redeemable noncontrolling interests, and impairments of right of use assets.

Actual results could differ from those estimates, and such differences could be material to our financial position and results of operations.

We review the useful lives of assets with a finite life on a recurring basis.

Effective July 1, 2025, we revised our estimate of the remaining useful life for certain intangible assets from four to seven years , down to one to three years .

These assets are included in “Intangible assets, net” on our consolidated balance sheets, are primarily “developed technology” within intangible assets, and primarily relate to assets arising from our acquisition of Wētā FX Limited in 2021.

The shortened useful lives are due to certain assets no longer being actively developed and the absence of currently established plans for incorporation into future Unity offerings.

The effect of this change in estimate for the year ended December 31, 2025, was an increase in amortization expense and decrease in operating income of approximately $ 77 million, an increase in net loss of approximately $ 61 million, and an increase in our basic and diluted net loss per share of approximately $ 0.15 per share.

Employee Separation and Restructuring Costs

In January 2024, we committed to a plan to eliminate approximately 25 % of our workforce, and we mutually agreed to the departure of the founders of ironSource Ltd.

Following these announcements, we incurred incremental employee separation costs of approximately $ 214 million in the year ended December 31, 2024, which included $ 127 million of incremental stock-based compensation.

Of the incremental employee separation costs, $ 15 million are within cost of revenue, $ 48 million are within research and development, $ 58 million are within sales and marketing, and $ 93 million are within general and administrative.

Additionally, in November 2023, we committed to a plan to reassess our real estate footprint.

We incurred $ 53 million of restructuring costs, primarily related to office closures in the year ended December 31, 2024.

In the year ended December 31, 2025, we incurred incremental employee separation costs of approximately $ 33 million, primarily within sales and marketing and research and development.

In the year ended December 31, 2024, we incurred incremental employee separation costs of approximately $ 214 million, which included $ 127 million of incremental stock-based compensation.

Of the incremental employee separation costs we incurred in the year ended December 31, 2024, $ 15 million are within cost of revenue, $ 48 million are within research and development, $ 58 million are within sales and marketing, and $ 93 million are within general and administrative.

Additionally, for the year ended December 31, 2025

Unity Software Inc.

and 2024, we incurred $ 14 million and $ 53 million, respectively, of other restructuring costs, primarily related to office closures.

Revenue Recognition

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When observable pricing is not available, we use cost plus margin analysis to determine SSP.

Unity Software Inc.

Our business focuses on two complementary sets of solutions:

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Create Solutions

Create Solutions are a combination of software and services that enable customers to edit, run, and iterate real-time 2D and 3D experiences.

Create Solutions are a combination of software and services that enable customers to edit, run, and iterate interactive, real-time 2D and 3D experiences.

Revenue is primarily derived from Create Solution Subscriptions, Enterprise Support, Professional services, and Consumption services.

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Grow Solutions revenue primarily consists of advertising services provided through our monetization solutions that allow publishers, which include mobile application developers, original equipment manufacturers ("OEM") and mobile carriers to sell available advertising inventory on their mobile applications or hardware devices to advertisers for in-app or on-device placements.

We present revenue on a net basis for sales where we are facilitating the transaction between advertisers and publishers and do not have control over in-app or on-device placement and on a gross basis for advertising sales where we are the publisher and have control of the in-app or on-device placement.

We present revenue on a net basis for sales where we are facilitating the transaction between advertisers and publishers and do not have control over in-app or on-device placement.

In these cases the publisher is our customer.

We present revenue on a gross basis for advertising sales where we are the publisher and have control of the in-app or on-device placement.

Advertising revenue is recognized at a point in time when the agreed upon action is completed or when the advertisement is displayed to users.

Cost of Revenue

Cost of revenue for the delivery of software services, professional services, and advertising consists primarily of hosting expenses, personnel costs (including salaries, stock-based compensation, and benefits) for employees associated with our product support and professional services organizations, credit card fees, third-party license fees, payments to developers where we are the publisher, and allocated shared costs, including facilities, IT, and security costs, as well as amortization of related capitalized software costs and depreciation of related property and equipment and amortization of acquired intangible assets.

Cost of revenue for the delivery of software services, professional services, and advertising consists primarily of hosting expenses, personnel costs (including salaries, stock-based compensation, and benefits) for employees associated with our product support and professional services organizations, fees paid to mediation platforms, credit card fees, third-party license fees, payments to developers where we are the publisher, and allocated shared costs, including facilities, IT, and security costs, as well as amortization of related capitalized software costs and depreciation of related property and equipment and amortization of acquired intangible assets.

Unity Software Inc.

Stock-Based Compensation

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For restricted stock units ("RSUs"), fair value is based on the closing price of our common stock on the grant date.

For performance-based restricted stock units ("PSUs"), fair value is based on the closing price of our common stock on the day the performance goals are set for each tranche of the award.

The fair value of stock options and purchases made under the 2020 Employee Stock Purchase Plan ("2020 ESPP") is estimated using the Black-Scholes pricing model.

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Options granted during the year have a maximum contractual term of ten years .

Unity Software Inc.

have limited historical stock option activity and therefore estimate the expected term of stock options granted using the simplified method, which represents the average of the contractual term of the stock option and its weighted-average vesting period.

We have limited historical stock option activity and therefore estimate the expected term of stock options granted using the simplified method, which represents the average of the contractual term of the stock option and its weighted-average vesting period.

The expected volatility of stock options and employee stock purchase plan ("ESPP") purchases are based upon our historical volatility and the historical volatility of a number of publicly traded companies in similar industries over similar durations.

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We do not adjust compensation cost for subsequent changes in the expected outcome of the market-based vesting conditions.

We recognize stock-based compensation expense for RSUs, stock options, PVUs, and PVOs, on a straight-line basis, typically over the requisite service period of the entire award, generally, a vesting period of one year to four years .

We recognize stock-based compensation expense for RSUs, stock options, PVOs, PVUs, and PSUs on a straight-line basis, typically over the requisite service period of the entire award, generally, a vesting period of one to four years .

We recognize stock-based compensation expense related to the 2020 ESPP on a straight-line basis over the offering period.

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Restrictions typically lapse at the end of the lease term, and restricted cash is classified as current or non-current based on the remaining term of the restriction.

Accounts Receivable

A ccounts Receivable

Accounts receivable are recorded at the original invoiced amount, net of allowances for uncollectible amounts.

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For the years ended December 31, 2025 and 2024, the provision for uncollectible amounts was $ 2.7 million and $ 7.7 million, respectively.

Unity Software Inc.

Credit Risk and Concentrations

Financial instruments that potentially subject us to a concentration of credit risk consist primarily of cash and cash equivalents, short-term investments, and accounts receivable.

We place our domestic and foreign cash and cash equivalents, as well as our short-term investments, with large, creditworthy financial institutions.

Financial instruments that potentially subject us to a concentration of credit risk consist primarily of cash and cash equivalents, and accounts receivable.

We place our domestic and foreign cash and cash equivalents, with large, creditworthy financial institutions.

Balances in these accounts may exceed federally insured limits at times.

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For the years ended December 31, 2025, 2024, and 2023, no individual customer represented 10% or more of total revenue.

Unity Software Inc.

Fair Value of Financial Instruments

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Comprehensive loss is comprised of net loss and other comprehensive loss.

Our other comprehensive loss includes unrealized gains and losses on available-for-sale investments, derivative instruments, and foreign currency translation adjustment.

Our other comprehensive loss includes unrealized gains and losses on derivative instruments, and foreign currency translation adjustment.

Property and Equipment, Net

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Additionally, incentives we receive are treated as a reduction of our costs over the term of the agreement.

Leasehold improvements are capitalized at cost and amortized over the lesser of their expected useful life or the non-cancellable term of the lease.

We establish assets and liabilities for the present value of estimated future costs to retire long-lived assets at the termination or expiration of a lease.

Such assets are depreciated over the lease period into operating expense, and the recorded liabilities are accreted to the future value of the estimated retirement costs.

Unity Software Inc.

Convertible Senior Notes and Capped Call Transactions

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Capped call transactions will not be remeasured as long as they continue to meet the conditions for equity classification.

Unity Software Inc.

We operate as a single operating segment.

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We capitalize such costs during the application development stage, which begins when the preliminary project stage is complete and ceases at the point in which the project is substantially complete and is ready for its intended purpose.

Capitalized software costs are amortized on a straight-line basis over their estimated useful life, which is generally two to three years .

Capitalized software costs are amortized on a straight-line basis over their estimated useful life, which is generally three years .

Management evaluates the useful lives of these assets on an annual basis and tests for impairment whenever events or changes in circumstances occur that could impact the recoverability of these assets.

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Impairment Analysis

We evaluate intangible assets and long-lived assets for possible impairment whenever events or changes in circumstances indicate that the carrying amount of such assets may not be recoverable.

We evaluate intangible assets and other long-lived assets for possible impairment whenever events or changes in circumstances indicate that the carrying amount of such assets may not be recoverable.

This includes but is not limited to significant adverse changes in business climate, market conditions, or other events that indicate an asset’s carrying amount may not be recoverable.

Recoverability of these assets is measured by comparing the carrying amount of each asset to the future undiscounted cash flows the asset is expected to generate.

Recoverability of these

Unity Software Inc.

assets is measured by comparing the carrying amount of each asset to the future undiscounted cash flows the asset is expected to generate.

If the undiscounted cash flows used in the test for recoverability are less than the carrying amount of these assets, the carrying amount of such assets is reduced to fair value.

We evaluate and test the recoverability of our goodwill for impairment at least annually during our fourth quarter of each calendar year or more often if and when circumstances indicate that goodwill may not be recoverable.

During the years ended December 31, 2024 and 2023, we recorded $ 16.2 million and $ 16.5 million of impairment charges on operating lease assets respectively, and during the year ended December 31,

Unity Software Inc.

2024 we recorded $ 22.8 million of impairment charges on property and equipment.

During the years ended December 31, 2025 and 2024, we recorded $ 3.8 million and $ 16.2 million of impairment charges on operating lease assets, respectively, and during the years ended December 31, 2025 and 2024 we recorded $ 5.9 million and $ 22.8 million of impairment charges on property and equipment, respectively.

These charges were primarily within general and administrative, and related to closures of corporate offices.

The fair values of these assets were determined using active market prices.

Apart from those operating lease asset, and property and equipment impairments, there were no material impairments of capitalized software costs, capitalized implementation costs, intangible assets, long-lived assets, or goodwill during the years ended December 31, 2024, 2023, and 2022.

Apart from those operating lease asset, and property and equipment impairments, there were no material impairments of capitalized software costs, capitalized implementation costs, intangible assets, goodwill, or other long-lived assets during the years ended December 31, 2025, 2024, and 2023.

We are subject to income taxes in the United States and numerous foreign jurisdictions.

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dollar functional currency subsidiaries, all assets and liabilities denominated in a foreign currency are translated into U.S.

dollars at the exchange rate on the balance sheet date.

Revenue and expenses denominated in a foreign currency are translated at the average exchange rate during the period.

dollars at the exchange

Unity Software Inc.

rate on the balance sheet date.

Revenue and expenses denominated in a foreign currency are translated at the relevant daily exchange rates.

Equity transactions denominated in a foreign currency are translated using historical exchange rates.

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We allocate the fair value of purchase consideration to the tangible assets acquired, liabilities assumed, and intangible assets acquired based on their estimated fair values as of the acquisition date.

The excess of the fair value of purchase consideration over the fair values of these identifiable assets and

Unity Software Inc.

liabilities is recorded as goodwill.

Intangible assets, with the exception of certain contractual relationships, which have a finite life are amortized on a straight-line basis over their estimated useful lives, which typically range from three to six years .

The excess of the fair value of purchase consideration over the fair values of these identifiable assets and liabilities is recorded as goodwill.

Certain contractual relationships are amortized using an accelerated method of amortization, which reflects the pattern in which the economic benefits from the intangible assets are expected to be recognized.

On an annual basis, we evaluate the estimated remaining useful life of acquired intangible assets and whether events or changes in circumstances warrant a revision to the remaining amortization period.

During the year ended December 31, 2025, we revised our estimate of the remaining useful life for certain intangible assets from four to seven years , down to one to three years .

See "Use of Estimates" section earlier in this note for more details.

No material changes to the useful lives of our intangible assets were deemed necessary during the years ended December 31, 2024, and 2023 based on management's evaluation.

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Advertising expense was approximately $ 8.2 million, $ 10.1 million, and $ 12.6 million for the years ended December 31, 2025, 2024, and 2023, respectively.

Recent Accounting Pronouncements Not Yet Adopted

Accounting Pronouncements Recently Adopted

In December 2023, the FASB issued a new Accounting Standards Update ("ASU 2023-09") amending existing income tax disclosure guidance, primarily requiring more detailed disclosure for income taxes paid and the effective tax rate reconciliation.

ASU 2023-09 is effective for annual reporting periods beginning after December 15, 2024, with early adoption permitted and can be applied on either a prospective or retroactive basis.

We are currently evaluating ASU 2023-09 to determine its impact on our income tax disclosures.

In November 2024, the FASB issued a new Accounting Standards Update ("ASU 2024-03") amending the existing disclosure requirement for expenses within Statement of Operations, primarily requiring more disaggregated disclosure for certain costs and expenses on an annual and interim basis.

We adopted ASU 2023-09 for the year ended December 31, 2025 on a prospective basis.

See Note 13 "Income Taxes" for additional information.

Recent Accounting Pronouncements Not Yet Adopted

In November 2024, the FASB issued a new Accounting Standards Update ("ASU 2024-03") amending the existing disclosure requirement for expenses within Statement of Operations, primarily

Unity Software Inc.

requiring more disaggregated disclosure for certain costs and expenses on an annual and interim basis.

ASU 2024-03 is effective for annual reporting periods beginning after December 15, 2026, with early adoption permitted and can be applied on either a prospective or retroactive basis.

We are currently evaluating ASU 2024-03 to determine its impact on our expense disclosures.

Unity Software Inc.

In July 2025, the FASB issued a new Accounting Standards Update ("ASU 2025-05") amending the guidance around estimation of credit losses on current accounts receivable and current contract assets to allow entities to elect a practical expedient to assume that the current conditions as of the balance sheet date will remain unchanged for the remaining life of the asset when developing a reasonable and supportable forecast.

ASU 2025-05 is effective for annual reporting periods beginning after December 15, 2025, with early adoption permitted and should be applied on a prospective basis.

We are currently evaluating ASU 2025-05 to determine its impact on our financial statements.

In September 2025, the FASB issued a new Accounting Standards Update ("ASU 2025-06") amending existing internal-use software guidance, changing the timing and thresholds for capitalizing these software costs.

ASU 2025-06 is effective for annual reporting periods beginning after December 15, 2027, with early adoption permitted and can be applied on either a prospective, modified, or retrospective basis.

We are currently evaluating ASU 2025-06 to determine its impact on our financial statements.

The following table presents our revenue disaggregated by source, which also have similar economic characteristics (in thousands):

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As of December 31, 2024, capitalized commissions, net of amortization, included in prepaid expenses and other and other assets were $ 6.5 million and $ 5.4 million, respectively.

For the years ended December 31, 2024 and 2023, we recorded amortization costs of $ 8.9 million and $ 9.9 million, respectively, in sales and marketing expenses.

Unity Software Inc.

During the years ended December 31, 2025 and 2024, we recorded amortization costs of $ 7.2 million and $ 8.9 million, respectively, in sales and marketing expenses.

We did not incur any impairment losses for the years ended December 31, 2025 and 2024.

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Additionally, we have performance obligations associated with commitments in customer contracts to perform in the future that had not yet been recognized in our consolidated financial statements.

For contracts with original terms that exceed one year, those commitments not yet recognized as of

Unity Software Inc.

December 31, 2024 were $ 334 million and relate primarily to Create Solutions subscriptions, Enterprise Support, and Strategic Partnerships.

For contracts with original terms that exceed one year, those commitments not yet recognized as of December 31, 2025 were $ 494 million and relate primarily to Create Solutions subscriptions, Enterprise Support, and Strategic Partnerships.

These commitments generally extend over the next one to five years and we expect to recognize approximately $ 225 million or 46 % of this revenue during the next 12 months.

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These valuations require significant judgment.

Unity Software Inc.

The following table summarizes, by major security type, our cash, cash equivalents, and restricted cash that are measured at fair value on a recurring basis and are categorized using the fair value hierarchy (in thousands):

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No material adjustments to the carrying value of these equity investments were recorded for the years ended December 31, 2025 and 2024.

Unity Software Inc.

Investment in Unity China

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Subsequent and contingent to the initial investment from third-party investors, a management investor contributed $ 14.4 million for an ownership interest of 1.5 % with no redemption rights.

Unity Software Inc.

The results of Unity China are included in our consolidated financial statements.

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Balance at beginning of period $ 230,627 $ 225,797 $ 219,563

Initial fair value measurement of investors' equity interest and redemption right — — 217,900

Net gain/(loss) attributable to redeemable noncontrolling interests 1,186 ( 161 ) ( 4,017 )

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income tax purposes.

Unity Software Inc.

The measurement period for the fair values of assets acquired and liabilities assumed in previous years is now closed, including for the merger with ironSource Ltd., for which we have now completed our tax returns.

During the years ended December 31, 2025, 2024, and 2023, we completed no acquisitions.

2022 Acquisitions

During the year ended December 31, 2022, we completed the acquisitions of certain companies, primarily ironSource, for a total purchase consideration of approximately $ 3.0 billion payable primarily in stock.

The purchase consideration was primarily allocated to goodwill of approximately $ 1.6 billion and intangible assets of approximately $ 1.3 billion.

These acquisitions were strategic in nature, and primarily enhanced Unity's Grow offerings.

The revenue and earnings of the acquired businesses have been included in our results since the acquisition dates.

Goodwill and Intangible Assets

Goodwill represents the excess of purchase price and related costs over the value assigned to net tangible and identifiable intangible assets acquired in business combinations.

The following table presents the changes in the carrying amount of goodwill for the years ended December 31, 2024 and 2023 (in thousands):

Balance as of December 31, 2022 $ 3,200,955

Goodwill acquired —

Measurement period adjustment ( 34,651 )

Balance as of December 31, 2023 3,166,304

Goodwill acquired —

Measurement period adjustment —

Balance as of December 31, 2024 $ 3,166,304

The carrying amount of goodwill as of December 31, 2025, 2024, and 2023 was $ 3.2 billion .

Unity Software Inc.

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2026 $ 435,109

Thereafter 79,389

Total $ 650,544

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Accrued expenses and other $ 299,541 $ 294,951

We have operating leases for offices which have remaining lease terms of up to eight years , some of which include options to extend the lease with renewal terms from one to five years .

We have operating leases for offices which have remaining lease terms of up to seven years , some of which include options to extend the lease with renewal terms from one to five years .

Some leases include an option to terminate the lease for up to five years from the lease commencement date.

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Present value of lease liabilities $ 89,382

As of December 31, 2024, we have not entered into any material leases that have not yet commenced.

Convertible Notes

As of December 31, 2024, we had $ 2.2 billion of unsecured convertible notes outstanding including $ 1.0 billion issued in November 2022 and $ 1.2 billion issued in November 2021.

In February 2025, we issued an aggregate of $ 690 million principal amount of 0 % convertible senior notes due 2030 (the "2030 Notes").

Proceeds from the issuance of the 2030 Notes were $ 677 millions, net of debt issuance costs and the cash was used to purchase capped call transactions, and repurchase convertible notes as discussed below.

The debt issuance costs are amortized to interest expense using the straight-line method, which approximates the effective interest method.

As of December 31, 2025, we had $ 2.2 billion of unsecured convertible notes outstanding including $ 690 million of the 2030 Notes, $ 1.0 billion issued in November 2022 (the "2027 Notes"), $ 558 million issued in November 2021 (the "2026 Notes", together with the 2027 Notes and 2030 Notes, the "Notes").

The table below summarizes the principal and unamortized debt issuance costs and other material features of the Notes (in thousands):

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Principal - 2027 Notes 20.4526 $ 48.89 2027 2.0 % 1,000,000 1,000,000

Principal – 2030 Notes

27.6656 $ 36.15 2030 0.0 % 690,000 —

Unamortized debt issuance costs, net ( 12,374 ) ( 6,310 )

Net carrying amount $ 2,235,350 $ 2,238,922

1) We entered into capped call transactions in connection with the 2026 and 2030 Notes.

The cap price of the capped call transactions relating to the Notes was initially $ 343.02 and $ 47.74 , respectively, subject to certain adjustments under the terms of the capped call transactions.

See below "--Capped Call Transactions."

Interest on the Notes is payable semi-annually in arrears.

The combined interest expense on the Notes related to regular interest and the amortization of debt issuance cost was $ 24.0 million and $ 23.5 million for the years ended December 31, 2025 and December 31, 2024, respectively.

As of December 31, 2024 and December 31, 2023, the estimated fair value of the 2027 Notes were approximately $ 1.0 billion and $ 1.3 billion, respectively, and the estimated fair value of the 2026 Notes were approximately $ 1.1 billion and $ 1.4 billion, respectively.

As of December 31, 2025, the estimated fair value of the 2030 Notes was approximately $ 1.0 billion.

As of December 31, 2025 and December 31, 2024, the estimated fair value of the 2027 Notes was approximately $ 1.2 billion and $ 1.0 billion, respectively, and the estimated fair value of the 2026 Notes was approximately $ 540 million and $ 1.1 billion, respectively.

The fair value of the 2027 Notes was based on a combination of a discounted cash flow and Black-Scholes option-pricing model.

The fair value of the 2026 Notes was based on quoted prices as of that date.

The 2026 Notes are convertible at the option of the holder if a conversion condition of the 2026 Notes is triggered.

During the year ended December 31, 2024, none of the conversion conditions of the 2026 Notes were triggered and the 2026 Notes were not convertible as of December 31, 2024.

The holders of the 2027 Notes may elect to convert the 2027 Notes at any time prior to maturity.

Any such conversion of the Notes may be satisfied at our election with either cash, shares of our common stock, or a combination of cash and shares of our common stock.

The fair value of the 2030 Notes and 2026 Notes was based on quoted prices as of that date.

The 2027 Notes may be converted at the election of the holders thereof at any time prior to maturity.

The 2026 Notes and 2030 Notes are convertible at the option of the respective holders thereof if a conversion condition applicable to such series of Notes is triggered.

During the year ended December 31, 2025, none of the conversion conditions of the 2026 Notes or the 2030 Notes were triggered, and neither the 2026 Notes nor the 2030 Notes were convertible as of December 31, 2025.

Any such conversion of the Notes described above, may be satisfied at our election with either cash, shares of our common stock, or a combination of cash and shares of our common stock.

The conversion rates for the Notes are subject to customary adjustments for certain events as described in the relevant indenture governing the Notes.

The Notes are subject to additional terms.

In connection with certain corporate events, as described in the indentures governing the Notes, we will increase the conversion rate for a holder of the Notes who elects to convert those Notes in connection with the event.

Additionally, upon the occurrence of certain corporate events and subject to certain exceptions, as described in the indentures governing the Notes, holders of the Notes may require us to repurchase all or a portion of their Notes at a price equal to 100 % of the principal amount to be repurchased, plus any accrued and unpaid interest to date.

The 2026 Notes are also redeemable at our option if certain conditions are met, as described in the indenture governing the 2026 Notes.

As of December 31, 2024, no holders of the 2027 Notes and 2026 Notes have exercised the conversion rights, and the if-converted value of the 2027 Notes and 2026 Notes did not exceed the principal amount.

In connection with certain corporate events, as described in the indentures governing the Notes, we will increase the conversion rate for a holder of the applicable series of Notes who elects to convert those Notes in connection with the event.

Additionally, upon the occurrence of certain corporate events and subject to certain exceptions, as described in the indenture governing the applicable series of Notes, holders of those Notes may require us to repurchase all or a

portion of those Notes at a price equal to 100 % of the principal amount to be repurchased, plus any accrued and unpaid interest to date.

The 2026 Notes and 2030 Notes are also redeemable at our option if certain conditions are met, as described in the indentures governing the 2026 Notes and 2030 Notes respectively.

As of December 31, 2025, no holders of the Notes have exercised the conversion rights, and the if-converted value of the Notes did not exceed the principal amount.

Convertible Note Repurchase

During the first quarter of 2024, the Company repurchased in privately negotiated transactions and extinguished a portion of the 2026 Notes, with a total principal balance of $ 480 million.

The aggregate repurchase price for these notes was $ 415 million, resulting in pre-tax gains of $ 61.4 million, net of the write-off of unamortized issuance costs.

The gain was included in Interest income and other income (expense), net, in the consolidated statement of operations.

During the first quarter of 2025, and the first quarter of 2024, the Company repurchased in privately negotiated transactions and extinguished a portion of the 2026 Notes, with a total principal balance of $ 688 million and $ 480 million, respectively.

The aggregate repurchase price for these notes was $ 642 million and $ 415 million, respectively, resulting in pre-tax gains of $ 42.7 million and $ 61.4 million, respectively, net of the write-off of unamortized issuance costs.

These gains were included in Interest income and other income (expense), net, in the consolidated statement of operations.

Capped Call Transactions

To reduce the potential dilutive effect of the 2026 Notes, in connection with their pricing, we entered into the Capped Call Transactions at a net cost of $ 48.1 million, with call options totaling approximately 5.6 million of our common shares, and with expiration dates ranging from September 18, 2026 to November 12, 2026.

The strike price is $ 308.72 , and the cap price is initially $ 343.02 per share, subject to adjustments in certain circumstances.

The Capped Call Transactions are freestanding and are considered separately exercisable from the 2026 Notes.

As of December 31, 2024, the Capped Call Transactions met the conditions for equity classification and were not in the money.

We entered into capped call transactions to reduce the potential dilutive effect of the 2026 Notes (the "2026 Capped Call Transactions"), and 2030 Notes (the "2030 Capped Call Transactions," together with the 2026 Capped Call Transactions, the "Capped Call Transactions"), in connection with their pricing.

The 2026 Capped Call Transactions, and the 2030 Capped Call Transactions, had net costs of $ 48.1 million and $ 44.4 million, respectively, with call options totaling approximately $ 5.6 million and $ 19.1 million of our common stock, and with expiration dates ranging from September 18, 2026 to November 12, 2026, and January 15, 2030 to March 13, 2030, respectively.

The strike price of the 2026 Capped Call Transactions, and the 2030 Capped Call Transactions are $ 308.72 and $ 36.15 , respectively, and the cap prices are initially $ 343.02 and $ 47.74 per share, respectively, subject to adjustments in certain circumstances.

The Capped Call Transactions are freestanding, are considered separately exercisable from the 2026 Notes and 2030 Notes, and meet the conditions for equity classification.

Commitments and Contingencies

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Total $ 3,146,496 $ 862,152 $ 1,446,238 $ 830,478 $ 7,628

(1) Operating leases consist of obligations for real estate, including leases that are not yet commenced.

(1) Operating leases consist of obligations for real estate, including leases that are not yet commenced or reflected on our consolidated balance sheet with future minimum lease payments of $ 7.4 million.

These leases will commence in 2026 with lease terms of approximately seven years .

(2) The substantial majority of our purchase commitments are related to agreements with our data center hosting providers.

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In addition, recoveries are shown as a reduction in legal costs in the period in which they are realized.

The Company is involved from time to time in claims, proceedings, and litigation, including the following:

On July 6, 2022, a putative securities class action complaint was filed in U.S.

District Court in the Northern District of California against the Company and certain of its executives (the "Securities Class Action").

The complaint was amended on March 24, 2023, and captioned In re Unity Software Inc.

Securities Litigation, Case No.

5:22-cv-3962 (N.D.

On May 25, 2023, all defendants moved to dismiss the amended complaint.

The plaintiffs filed an opposition to the motions to dismiss on July 26, 2023.

The Company filed a response to the plaintiffs' opposition on September 1, 2023.

On March 15, 2024, the court granted the Company's motion to dismiss the complaint, and on April 12, 2024, the plaintiffs' filed a second amended complaint.

The Company has moved to dismiss the amended complaint.

The plaintiffs have filed an opposition to the motion to dismiss, and the Company has filed a response to the plaintiff's opposition.

A hearing on the motion to dismiss was held on February 5, 2025, and the Company is awaiting the ruling.

The operative complaint names as defendants Unity, its former Chief Executive Officer, former Chief Financial Officer, and former General Manager of Operate Solutions, as well as Unity shareholders, Sequoia Capital, Silver Lake Group, and David Helgason.

The complaint asserts claims under Sections 10(b) and 20(a) of the Securities Exchange Act of 1934, and alleges that the Company and its executives made false or misleading statements and/or failed to disclose issues with the Company's product platform and the likely impact of those issues on the Company's fiscal 2022 guidance.

The plaintiffs seek to represent a class of all persons and entities (other than the defendants) who acquired Unity securities between May 11, 2021 and May 10, 2022, and requests unspecified

Unity Software Inc.

damages, pre- and post-judgment interest, and an award of attorneys' fees and costs.

The Company intends to continue to vigorously defend the case.

On November 22, 2022, a derivative suit, captioned Movva v.

Unity Software, Inc., et al., Case 5:22-cv-07416 (N.D.

Cal.) (the "Movva Suit"), was filed by a purported stockholder against eleven of the Company's current and former officers and directors.

The complaint, which asserts claims for breach of fiduciary duty, waste of corporate assets, unjust enrichment, and violations of Section 14(a) of the Exchange Act, borrows the allegations of the Securities Class Action, and recasts them as derivative claims.

On December 16, 2022, a related derivative suit, captioned Duong vs.

Unity Software Inc., et al., Case 5:22-c-08926 (N.D.

Cal.), was filed by a purported stockholder against the same defendants as in the Movva Suit (the "Duong Suit," and together with the Movva Suit, the "Federal Derivative Actions").

The two Federal Derivative Actions were consolidated after the parties jointly moved to do so.

The Federal Derivative Actions have been stayed pending the outcome of the motions to dismiss in the Securities Class Action.

On May 8, 2023, a stockholder derivative suit, captioned Wen v.

Botha, et al., Case No.

2023-0499 (the "Wen Suit"), was filed in the Court of Chancery of the State of Delaware.

The case was filed by a purported Unity stockholder against twelve of the Company's current and former officers and directors, and asserts claims for breach of fiduciary duty, aiding and abetting breach of fiduciary duty, unjust enrichment, and waste of corporate assets.

On December 15, 2023, a stockholder derivative suit, captioned Flesner v.

Riccitiello, et al., Case No.

2023-1240 (the "Flesner Suit" and together with the Wen Suit, the "Delaware Derivative Actions"), was filed in the Court of Chancery of the State of Delaware.

As with the Federal Derivative Actions, the Delaware Derivative Actions borrow the allegations of the Securities Class Action, and recast them as derivative claims.

The Delaware Derivative Actions have also been stayed pending the outcome of the motion to dismiss in the Securities Class Action.

It is possible that additional suits will be filed, or allegations received from shareholders, with respect to these same or other matters, naming Unity and/or its officers and directors as defendants.

We dispute these allegations and intend to vigorously defend ourselves in these matters.

With respect to our outstanding matters, based on our current knowledge, we believe that the resolution of such matters will not, either individually or in aggregate, have a material adverse effect on our business or our condensed consolidated financial statements.

With respect to our outstanding matters, based on current knowledge, we believe that the resolution of such matters will not, either individually or in the aggregate, have a material adverse effect on our business or our consolidated financial statements.

However, litigation is inherently uncertain, and the outcome of these matters cannot be predicted with certainty.

Accordingly, cash flows or results of operations could be materially affected in any particular period by the resolution of one or more of these matters.

From time to time, we may be subject to other legal proceedings and claims arising in the ordinary course of business.

Letters of Credit

We had $ 8.5 million and $ 10.2 million of secured letters of credit outstanding as of December 31, 2025 and 2024, respectively.

These primarily relate to our office space leases and are fully collateralized by certificates of deposit which we record in restricted cash as other assets on our consolidated balance sheets.

These primarily relate to our office space leases and are fully collateralized by certificates of deposit which we record in restricted cash as other assets and prepaid expenses and other on our consolidated balance sheets.

Stockholders' Equity and Employee Compensation Plans

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Stock Award Plans

Our stock compensation plans allow us to grant or assume through acquisition stock options and RSUs, including PVOs and PVUs, to employees and non-employee directors.

Our stock compensation plans allow us to grant or assume through acquisition stock options and RSUs, including PVOs, PVUs, and PSUs, to employees and non-employee directors.

As of December 31, 2025, we had reserved a total of 91.4 million shares of common stock under our collective compensation plans, of which 53.8 million were available for future grant.

Employee Stock Purchase Plan

We offer an ESPP that permits employees to purchase shares of our common stock through payroll deductions of up to 15 % of their earnings.

We offer an Employee Stock Purchase Plan ("ESPP") that permits employees to purchase shares of our common stock through payroll deductions of up to 15 % of their earnings.

Unless otherwise determined by the administrator, the purchase price of the shares will be 85 % of the lower of the fair market value of our common stock on (i) the first day of an offering or (ii) on the date of purchase.

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The maximum number of shares of our common stock that may be issued under our 2020 ESPP is 22.6 million shares, of which 18.7 million were available for issuance as of December 31, 2025.

During 2025, we suspended the ESPP program, effective in the first quarter of 2026.

As a result of the suspension, no new offering periods will commence after March 2, 2026.

Employee 401(k) Plan

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Defined Contribution Pension Plan

For other operations outside the United States, we have a defined contribution pension plan.

For other operations outside the United States, we have a defined contribution pension plan in some countries.

We contribute up to 18 % of total salary into the plan annually when employees contribute to the plan.

For the years ended December 31, 2025, 2024, and 2023, we contributed and expensed $ 15.9 million, $ 19.5 million, and $ 25.8 million, respectively, to the plan.

Unity Software Inc.

Stock‑Based Compensation

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Included in the above expenses for the year ended December 31, 2025 and 2024, are $ 13.0 million and $ 93.8 million respectively, of incremental stock-based compensation expense from modifications, primarily within general and administrative.

These amounts predominately relate to modifications to accelerate vesting or extend the exercise period, of awards held by the founders of ironSource Ltd.

that departed in the first quarter of 2024, and awards held by key employees that departed in the fourth quarter of 2023, respectively.

These amounts predominately relate to modifications of awards held by departing executives in the fourth quarter of 2025, and the founders of ironSource Ltd.

that departed in the first quarter of 2024, respectively.

Unrecognized compensation expense is as follows (in thousands, except for weighted-average remaining vesting period):

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ESPP $ 1,327 0.17

Unity Software Inc.

In future periods, stock-based compensation expense may increase as we issue additional equity-based awards to continue to attract and retain employees.

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Price Weighted-Average

(In Years) Aggregate pretax intrinsic value (1)

(in thousands)

Balance as of December 31, 2023 31,541,466 $ 19.35 4.79

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(1) The intrinsic value is the difference between the estimated fair value of our common stock on December 31, 2025 and the exercise price for in-the-money options.

Unity Software Inc.

A summary of intrinsic and fair values of our stock options is as follows (in thousands, except fair value amounts):

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(1) The intrinsic value is the difference between the estimated fair value of our common stock on the date of exercise and the exercise price for in-the-money options.

Unity Software Inc.

Restricted Stock Units

A summary of our RSU, including PVU, activity is as follows:

A summary of our restricted stock units ("RSU"), including price-vested units ("PVU"), and performance-based restricted stock units ("PSU"), activity is as follows:

Unvested RSUs

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The total fair value of RSUs vested as of the vesting dates during the years ended December 31, 2025, 2024, and 2023 was $ 414 million, $ 330 million, and $ 448 million, respectively.

Price-Vested Units and Price-Vested Options

The vesting for each of the PVUs and PVOs is subject to the fulfillment of both a service period that extends up to four years and the achievement of a stock price hurdle during the relevant performance period that extends up to six and seven years , respectively.

The fair value of each PVU and PVO award is estimated using a Monte Carlo simulation that uses assumptions determined on the date of grant.

During the year ended December 31, 2024, the price hurdle on 62,578 outstanding PVU units were met, resulting in 3,911 PVU units vesting during the year.

The price hurdle was not met on any other units for the years ended December 31, 2024, and 2023.

Price-Vested Options and Price-Vested Units

The vesting for each of the PVOs and PVUs is subject to the fulfillment of both a service period that extends up to four years and the achievement of a stock price hurdle during the relevant performance period that extends up to six and seven years , respectively.

The fair value of each PVO and PVU award is estimated using a Monte Carlo simulation that uses assumptions determined on the date of grant.

During the year ended December 31, 2025, the price hurdle on 420,000 outstanding PVOs was met, resulting in those units vesting.

No other outstanding options or units, which had not already met their price hurdle in a prior period, attained their price hurdle in this period.

Performance-Based Restricted Stock Units

Starting in the first quarter of 2025, we have issued PSUs to certain executives as part of their compensation.

The vesting for each PSU is subject to the fulfillment of both a service period of three years , and the level of achievement of certain performance goals (revenue and EBITDA metrics), over three annual performance periods ("tranche").

These goals are set as a range of target outcomes, in the first quarter of each year, and can be attained at a rate between 0 % and 150 %, based on where in the range the final results fall.

The fair value of each PSU is estimated separately for each tranche of the award, using the closing price of Unity's common stock on the day the performance goals are set for that

Unity Software Inc.

The expense is the fair value of the award multiplied by the expected attainment of the related performance goals as of the balance sheet date, recognized ratably for each tranche over the period between the day the performance goal is set, and the end of the service period.

The expense is adjusted each period for any changes in the expected attainment of the performance goals.

Fair Value Assumptions

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3.8 % - 4.9 %

1.7 % - 4.0 %

Expected volatility 69.5 % 60.0 % - 68.0 %

54.7 % - 65.8 %

33.3 % - 52.2 %

Expected term (in years) 6.25 6.25 - 10.00

6.25 6.25 - 7.00

Fair value of underlying common stock $ 24.72 $ 15.60 - $ 26.89

$ 28.13 - $ 39.29

$ 27.88 - $ 89.01

Unity Software Inc.

Employee Stock Purchase Plan

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Total $ ( 395,198 ) $ ( 667,133 ) $ ( 797,845 )

Unity Software Inc.

The components of the provision for income taxes consists of the following for the years ended December 31, 2025, 2024, and 2023 (in thousands):

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Reconciliations of the income tax provision at the U.S.

federal statutory tax rate to the provision for (benefit from) income taxes are as follows (in thousands):

federal statutory tax rate to the provision for (benefit from) income taxes for the year ended December 31, 2025, is as follows (in thousands, except percentages):

Year Ended December 31, 2025

federal statutory tax rate $ ( 82,992 ) 21.00 %

Changes in income taxes resulting from:

State and local income taxes, net of federal benefit (1)

( 308 ) 0.08 %

Foreign tax effects

Incentive tax rate 15,089 ( 3.82 ) %

Other ( 4,905 ) 1.24 %

Changes in valuation allowance ( 16,142 ) 4.08 %

Other ( 2,357 ) 0.60 %

United Kingdom

Foreign currency exchange 5,695 ( 1.44 ) %

Other ( 11,093 ) 2.81 %

Other foreign jurisdictions 13,430 ( 3.41 ) %

Effect of changes in tax laws or rates enacted in the current period — — %

Effect of cross-border tax laws 1,323 ( 0.33 ) %

Research & Development Credits ( 7,146 ) 1.81 %

Changes in valuation allowances 104,386 ( 26.41 ) %

Nontaxable or nondeductible items

Stock-based compensation ( 17,819 ) 4.51 %

Non-deductible compensation 14,365 ( 3.64 ) %

Other ( 3,462 ) 0.88 %

Changes in unrecognized tax benefits ( 1,769 ) 0.45 %

Total tax provision (benefit) $ 6,295 ( 1.59 ) %

(1) State taxes in New York and New York City made up the majority (greater than 50%) of the tax effect in this category.

Unity Software Inc.

Reconciliations of the income tax provision at the U.S.

federal statutory tax rate to the provision for (benefit from) income taxes for the years ended December 31, 2024 and 2023 are as follows (in thousands):

Year Ended December 31,

federal statutory tax rate $ ( 167,584 ) $ ( 138,742 )

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Total tax provision (benefit) $ ( 2,846 ) $ 28,477

(1) Certain prior year amounts have been reclassified to conform to current year presentation.

Our income tax provision for the year ended December 31, 2024 was primarily driven by losses that cannot be benefited due to the valuation allowance on U.S., Denmark, United Kingdom ("U.K."), China, and Canada entities, and to a lesser extent, foreign earnings taxed at different tax rates.

In addition, during the first quarter of 2024, we recorded a tax benefit on foreign losses in connection with employee separation costs and we continued to restructure our tax operations which resulted in a reduction to our U.S.

valuation allowance.

Our income tax provision for the year ended December 31, 2025 was primarily driven by losses that cannot be benefited due to the U.S.

valuation allowance and taxable income in certain foreign jurisdictions.

Our income tax provision for the year ended December 31, 2024 was primarily driven by losses that cannot be benefited due to the valuation allowance on U.S., Denmark, U.K., China, and Canada entities, and to a lesser extent, foreign earnings taxed at different tax rates.

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As of December 31,

2024 2023 (1)

Deferred tax assets:

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Total deferred tax liabilities ( 156,175 ) ( 269,325 )

Net deferred tax assets $ ( 72,669 ) $ ( 98,155 )

Net deferred tax assets (liabilities), net of valuation allowances $ ( 50,800 ) $ ( 72,669 )

1) Certain prior year amounts have been reclassified to conform to current year presentation.

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will not expire.

federal, state, and foreign research and development credit carryforwards were $ 107 million, $ 51.2 million and $ 1.6 million, respectively.

federal and state research and development credit carryforwards were $ 115 million and $ 43.9 million, respectively.

federal credit carryforwards, if not utilized, will begin to expire in 2033, while the California credit carryforwards have no expiration.

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Gross increases for tax positions taken in current year 5,254 9,001 10,573

Acquired tax positions — — 11,989

Reductions resulting from lapses of statues of limitations — ( 668 ) ( 660 )

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Our 2012 and subsequent tax years remain open to examination by the Internal Revenue Service.

Our 2019 and subsequent tax years remain open to examination in Israel and Denmark.

We believe that adequate amounts have been reserved in accordance with ASC 740 for any adjustments to the provision for income taxes or other tax items that may ultimately result from examinations.

The timing of the resolution, settlement, and closure of any audits is highly uncertain, and it is reasonably possible that the balance of gross unrecognized tax benefits could significantly change in the next 12 months.

Given the number of years remaining that are subject to examination, we are unable to estimate the full range of possible adjustments to the balance of gross unrecognized tax benefits.

If the taxing authorities prevail in the assessment of additional tax due, the assessed tax, interest, and penalties, if any, could have a material adverse impact on our financial position, results of operations, or cash flows.

Our 2019 and subsequent tax years remain open to examination in Denmark, Finland, France, and Israel.

The components of the cash paid for (refunded from) income taxes, net, consists of the following for the year ended December 31, 2025 (in thousands):

Year Ended December 31,

Federal $ 580

State ( 543 )

Foreign 10,552

Total cash paid for income taxes, net of refunds:

Unity Software Inc.

Individual jurisdictions equaling 5% or more of the total cash paid for (refunded from) income taxes, net, for the year ended December 31, 2025 include:

Israel $( 9.5 ) million, Denmark $ 4.1 million, Canada $ 3.0 million, China $ 2.6 million, Finland $ 1.5 million, France $ 1.4 million, UK $ 1.3 million, Spain $ 1.0 million, Japan $ 1.0 million, India $ 0.8 million, Korea $ 0.7 million, U.S.

Federal $ 0.6 million.

Net Loss per Share of Common Stock

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Stock options and PVOs 12,474 23,158 31,541

Unvested RSUs and PVUs 30,013 37,333 38,105

Unvested RSUs, PVUs, and PSUs 24,928 30,013 37,333

Segment Information

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See "Revenue Recognition" in Note 1 for detailed information regarding our products and services.

Our chief operating decision maker is the chief executive officer, who on a consolidated basis, assess the performance of, drives improvements in, and decides how to allocate resources in the reportable segment, based on multiple measures of performance including consolidated net income, adjusted EBITDA, and adjusted gross margin.

As such, consolidated net income, which is reported and reconciled with all significant segment expenses on our consolidated statement of operations, is the measure that is most consistent with GAAP, while adjusted EBITDA and adjusted gross margin are additional measures of our segment profitability.

As such, consolidated net income, which is reported and reconciled with all significant segment expenses on our consolidated statement of operations, is the measure that is most consistent with GAAP, while adjusted EBITDA, adjusted gross margin, and adjusted EPS are additional measures of our segment profitability.

The measure of segment assets is reported on the balance sheet as total consolidated assets.

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 8. Financial Statements and Supplementary Data