Unity Software nyse U Shares Fell 8 Post announcement of Massive Job Cuts

Unity Software (NYSE: U) Shares Fell 8% Post-Announcement of Massive Job Cuts

Unity Software (NYSE: U) shares fell almost 8% in the regular trading Wednesday after the company revealed plans for a substantial workforce reduction. The company aims to cut approximately 1,800 jobs, constituting a 25% reduction in its workforce.

The decision is part of a broader “company reset” strategy outlined in November 2023 to enhance long-term profitability. This round of cuts follows previous workforce reductions, including a 3.8% cut announced in November and an 8% reduction in May.

Unity Software, known for providing software used by video game creators, can’t yet estimate the costs related to the initiatives intended to enhance long-term profitability, as stated in a filing on Monday.

Unity Software (NYSE: U) is undergoing strategic changes after John Riccitiello’s departure as CEO in October, a move prompted by a controversial tenure that involved rebranding Unity as a metaverse company. James Whitehurst, a technology veteran, has since assumed the role of interim CEO.

Games like Pokemon Go and Marvel Snap rely on Unity’s products. The company upset numerous customers with price increases last year but eventually backtracked on those changes.

Unity shares surged 4.8% to reach $40.87 in after-hours trading following the filing. The stock recorded a 43% gain last year, driven by growing sales and reduced losses.