Why Unity Software Stock Plunged 74% in the First Half of 2022
Shares of Unity Software (NYSE: U) plunged 74.2% in the first half of 2022, according to data provided by S&P Global Market Intelligence. For its part, the stock market fell over 20% during this time, so it's a harsh market. However, investors were particularly bearish about Unity because of its high valuation and a big problem that it discovered with its business.
Unity's software is often used in mobile gaming. Companies can build their gaming app and run it through the different solutions Unity provides. Building solutions are in Unity's create segment, whereas the company's operate segment records revenue generated from helping run and monetize the applications.
Unity had its initial public offering (IPO) in 2020, which was well received by the market. Investors were excited to own a piece of a company with a leadership position in the digital-content creation space. And with this excitement, Unity stock traded at extremely high valuations.
Source Fool.com
