Forensic Analysis · Technology / Software · as of Jun 27, 2026
Unity Software Inc. (U)
A forensic read on Unity Software Inc. built from its complete SEC filings — financial-health screens, earnings quality, red flags and a price-aware rating. Reproducible math, not opinion.
D · Weak — demands caution
Forensic grade
Distress
Financial health
-0.2
Altman Z-score
Clean
Earnings quality
5
Forensic signals
-21.3%
ROE
$12.3B
Market cap
Unity Software Inc. earns a D (Weak — demands caution) forensic quality grade, and its Altman Z-score is -0.2, placing it in the Distress zone. 5 forensic signals were flagged in its latest SEC filings, led by return on invested capital.
What the filings flag
-12%Return on invested capital.Return on invested capital is -12% and steady — well below its ~10% cost of capital, so reinvested dollars may be destroying value, not building it.
+11.9%/yrShare-count dilution.Diluted share count changed +36% over the last 3 years to FY2025 (+11.9%/yr). The count is GROWING — existing holders are being diluted. That's ~11.9% shaved off per-share growth every year — total profit has to grow that much just to keep earnings-per-share flat, and a stake held since FY2022 has been diluted ~36%.
21% of revStock-based comp load.Stock-based compensation ran 21% of revenue and 95% of free cash flow in FY2025 — about $0.92 per diluted share. Heavy — a large slice of 'free cash flow' is really being paid out in stock, so the true owner cash per share is well below the headline.
stoppedShareholder returns — halted.Capital returns have STOPPED — $250M of buybacks + dividends in FY2023, but ~$0 in FY2025. A halt usually means the company is conserving cash; understand why before reading it as neutral.
127d DSOReceivables vs revenue.Days sales outstanding moved from 116 to 127 days FY2024→FY2025 (receivables +12% vs revenue +2%). Receivables are creeping up relative to sales — watch the trend.
Key fundamentals
Net Margin-21.8%
Free Cash Flow$403.9M
Latest Revenue$1.85B
Return on Equity-12.4%
Revenue Growth YoY+2.0%
Go deeper — free with an account
The forensic grade and screens above are free — no account needed. An account adds the full interactive deep-dive on Unity Software Inc.:
🔒The written investment read — what the numbers mean, in plain English
🔒Ask anything about U's filings — AI Q&A across the 10-K, 10-Qs & 8-Ks
🔒Interactive valuation — reverse-DCF sliders, Monte Carlo & scenario stress
🔒Calibrated 12-month price forecast, with the math shown