Unity’s earnings show just how hard it is to earn a 10x software multiple today

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Demonstrating operating leverage is not enough in a conservative market

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It’s a busy week for technology earnings, with companies including Coinbase, Alibaba and Etsy dropping numbers detailing their recent performance.

Unity is in the mix as well, providing the investing public with its first set of numbers since it closed its merger with ironSource. The deal brought Unity’s broadly applicable development engine and ironSource’s mobile app management and monetization service under the same roof.

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However, while some tech companies saw a share-price bump after releasing their earnings data, Unity’s shares lost around 13% in early trading today, indicating investor dissatisfaction with its results. In brief, Unity’s forward guidance fell short of expectations, leading to the street to bid its equity lower.

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