Ladies and gentlemen, thank you for joining us, and welcome to the Unity Technologies Q2 earnings call. After today's prepared remarks, we will host a question and answer session. If you'd like to ask a question, please raise your hand. If you have dialed into today's call, please press star nine to raise your hand and star six to unmute. I will now hand the conference over to Alex Giaimo, Head of Investor Relations. Alex, please go ahead. Thank you. Good morning, everyone. Welcome to Unity's second quarter 2026 earnings call. Today, I'm joined by our CEO, Matt Bromberg, and our CFO, Jarrod Yahes. Before we begin, I want to note that today's discussion contains forward-looking statements, including statements about goals, business outlook, industry trends, and expectations for future financial performance, all of which are subject to risks, uncertainties, and assumptions. You can find more information in the Risk Factor section of our filings at sec.gov. Actual results may differ, and we take no obligation to revise or update any forward-looking statements. Finally, during today's meeting, we will discuss non-GAAP financial measures. These non-GAAP financial measures are an addition to and not a substitute for or superior to measures of financial performance prepared in accordance with GAAP. A full reconciliation of GAAP to non-GAAP is available in our press release and on the sec.gov website. With that, I will turn it over to Matt. Thank you, Alex. Good morning. For everyone on the phone, thank you for joining us this morning as well. It is, as always, a distinct privilege for us to be able to represent the fine work of the Unity team from around the world. Two years ago on this call, we told you that a rededication to our customers' needs, more disciplined execution, and sharply accelerated product velocity would transform our company. Although we were in a difficult moment, we believed we had everything we needed to bring Unity all the way back, and we did. One year ago, we posited that Unity had hit an inflection point in that transformation, and that our efforts would translate to a markedly improved and sustainable series of business results, and they did. Today, after what was arguably the best quarter in Unity's history as a public company, we're done looking backwards. The flywheel we've been constructing is spinning up, and we expect it to power us into the ranks of the most consequential companies of the AI era, and it will. Why? Because AI has already become the most crucial driver of our product velocity and quality, and is also well on its way to becoming our most crucial driver of demand. To remind everyone how this AI-powered flywheel works at Unity, as game creation becomes more efficient, more games are being released. More games drive more usage of our integrated authoring platform and also make new game discovery more challenging, accelerating our ad business. More games, more platform usage, more discovery, all driven by the unique understanding that we derive from the approximately 3 billion people each month playing a game on the Unity runtime. An understanding which we use in turn to help creators build better games, to help them acquire new users, and to help them operate successful live services. With that as an introduction, let's turn to this quarter's results, beginning with Unity Vector. In performance marketing, we only win when our customers win. Advertisers are laser-focused on the direct return of their ad spend, and our technology must empower them to hit and exceed their return targets at maximum scale. Through continuous product enhancement, higher quality data, and compounding model improvements, we are now driving significant gains for our customers across every campaign type, genre, geography, and platform, and it's having an exceptionally positive impact on our business results. Our expectations for growth in Unity Vector in Q2 were a robust 12%-13% growth quarter-over-quarter. Instead, our team delivered nearly double that, racking up 23% quarter-over-quarter growth and establishing an accelerated momentum that has carried over to elevated results in Q3. Keep in mind, six quarters ago, the Unity Vector product didn't exist. It is now at substantially over $1 billion in annual run rate, two quarters earlier than expected, and yet we still consider ourselves to be in the very early stages of product development. Our astounding performance is fueling a 63% year-over-year increase in our strategic growth business, with our third quarter outlook pointing to an even stronger 70% growth rate. Overall company EBITDA margins are approaching 30% for the first time ever. We don't know of many companies at our scale growing revenue at this velocity while simultaneously expanding margins 800 basis points year-over-year. In the second quarter alone, the Vector team successfully executed over 20 major updates, advancing the capabilities and intelligence of our AI prediction platform, bringing new runtime data online, and transforming how we identify, understand, and value gamer attention. This incredible rate of change enabled Unity to optimize real-time bidding precision for our advertisers to a degree that was formerly impossible. One of the most impactful updates in Q2 has been our day 28 return on advertising spend capability for both in-app advertising and hybrid campaigns, a companion to the in-app purchase product that was released in the first quarter. As the name suggests, day 28 ROAS enables our partners to measure their return over a longer period than our standard seven-day ROAS product. Initially released at the end of Q1, the full rollout has now seen day 28 campaign spend growing nearly 3X from the first quarter. Over 25% of our advertising base has adopted this new campaign strategy, and the demand is scaling rapidly as a result of our delivering extremely strong performance. Q2 also contained another transformational milestone. We are speaking, of course, about the first incorporation of runtime data into the Vector platform. As we have emphasized many times, there are currently over 3 billion consumers each month playing a made with Unity game, and the connection with those billions of players through our runtime has been an untapped capability that we have long believed should deliver unique value across our platform. Towards the end of the second quarter, we began for the first time in our history to unlock this advantage by incorporating signals from our runtime directly into our Vector AI models. While this effort remains very early, the results are extremely encouraging, and we gain more and more confidence each day that runtime represents a deep and sustainable competitive advantage for Unity. Let's transition now to the Create business. The future of game creation no longer belongs only to those who can marshal the most resources, but rather to those who can best use the technology to amplify the resources they have. Two weeks ago, at our Unite conference in Seoul, we announced the release of Unity 7, a new generation of our software designed for this future. An open, collaborative platform where developers, artists, producers, and coding agents work together across the full development life cycle. We've made our MCP free and opened our API, which enables developers to use the command line and coding agents to control Unity directly from inside their own workflows. What this all means is that you no longer have to know all the intricacies of our application to access the power of our full authoring platform. What's even more exciting is that this platform, including the downstream revenue-enabling services, Vector, our commerce solutions, and our live game operation services, are all now configured automatically on day one. There are no instructions. There are no SDKs. There is no engineering time required. Remember what I referenced slightly earlier. Remember our flywheel. More games, more platform usage, more discovery, all driven by runtime and Vector AI. We believe Unity 7, which will launch in beta in Q4 of 2026, and with a full release in Q1 of 2027, holds the potential to be the most exciting and impactful release in our history, in that it points the way to a fundamentally different future, one where the top of the funnel gets bigger and bigger to accommodate the increased interest in the creation of interactive entertainment. Before leaving Create, I did want to highlight a new partnership Unity consummated in Q2 with Netflix. We're so thrilled about it, and I want to highlight it because it exemplifies the kind of innovation we live to help support. The partnership calls for us to comprehensively support the Netflix multi-platform games ecosystem with the Unity engine in the years ahead. Netflix has launched something potentially revolutionary, presenting a social game experience for consumers on the biggest screen in the house instantly, without asking them to download, register, or buy anything, with the potential to add an entirely new engagement path for their customers. This is the kind of advancement that Unity exists to support. Consumer habits are changing. Distribution platforms are evolving and will continue to evolve, but Unity's role remains straightforward and constant. Make it easier for studios to build great games and get them in the hands of players wherever they are. We're proud that Netflix has chosen to do that work with us. Thank you again very much for taking the time to be with us this morning. We are incredibly proud of Unity's performance in Q2. The continued acceleration of Vector, coupled with our robust product roadmap in Create, has us more excited than we've ever been about our future. I'll now pass the call over to Jarrod for a deeper discussion of our financials. Jarrod? Thanks, Matt. Good morning, everyone. Unity delivered a truly exceptional second quarter, with strategic revenue growth of 38% and adjusted EBITDA growth of 77%, along with record margins. Strategic Grow revenue was $329 million, up 63% year-over-year. Growth accelerated both quarter-on-quarter and year-over-year based on tremendous momentum at Unity Vector. Of note, the sunsetting of the ironSource ad network had a negligible positive impact on Vector growth in the quarter, with only $3 million in Q2 Vector revenue growth from ironSource customers as a result of the shutdown. In Create, strategic revenue was $157 million, up 14% year-over-year when excluding the impact of a one-time revenue item in the prior year. Create momentum continues to be driven by ARPU growth, supported by price increases and minimum annual customer commitments, as well as strong growth in China. Ultimately, these results are the direct outcome of products that deliver the innovation and performance our customers demand, steadily enhancing Unity's core value proposition. Shifting from revenue to profitability, adjusted EBITDA in Q2 was $160 million. Adjusted EBITDA margins were 29%, with margins expanding 800 basis points year-over-year. Rapid revenue growth, high gross margins, and disciplined cost management resulted in significant operating leverage. This operating leverage is the primary reason why adjusted EBITDA grew 77% year-over-year, more than two times the growth rate of strategic revenues. We experienced operating leverage across all major expense lines in the second quarter. In addition, adjusted sales and marketing and adjusted G&A were down not only in percentage terms, but in dollar terms. We're making strong progress in optimizing our cost structure and simplifying our business and using that freed-up capital to reward high-growth businesses like Unity Vector while aggressively investing in our product roadmap. Rapid growth in adjusted EBITDA is converting into exceptional free cash flow. Unity had $202 million in free cash flow in the second quarter, an increase of 59% year-over-year. This brings our cash balance to $2.36 billion, with Unity flipping from a net debt position to a net cash position this quarter. Our near-term capital plans center around de-levering our balance sheet, and we expect to pay off our 2026 convert in November. Longer term, the record cash generation we are experiencing, combined with a de-levered balance sheet, opens up tremendous flexibility from a capital allocation standpoint. Outside of cash expenses, the disciplined approach we're taking to equity resulted in stock comp expense down 25% year-on-year. Stock comp expense was 14% of revenues for the quarter, its lowest level ever. Before moving on to guidance, I'd like to provide three recent strategic updates. Firstly, during the quarter, we made a strategic investment in mobile measurement leader AppsFlyer, along with investment partners Meta, Google, and Moloco. This was a unique opportunity to invest in a market-leading asset while simultaneously allowing AppsFlyer to preserve competition, choice, and innovation in the mobile attribution and measurement ecosystem. Secondly, we're pleased to report that we closed on August 4th, the sale of Supersonic to Tripledot Studios. With this transaction, Supersonic finds an outstanding home with Tripledot, one of the largest and most successful mobile game publishers in the world. Lastly, during the quarter, we substantially completed the closure of our ironSource ad network, effective April 30th. The sale of Supersonic and the sunset of the ironSource ad network will benefit our margins in the second half of the year. With these actions, Unity becomes a more focused company, positioned for faster revenue growth and dramatically higher levels of profitability. With that, let's now turn to our guidance for the third quarter. For the third quarter, we're guiding to strategic revenue of $540 million-$550 million, implying year-over-year revenue growth of 44%-47%. This represents a material acceleration from the growth rates we saw in the second quarter. In Grow Solutions, we expect year-over-year revenue growth of 68%-70%, driven by continued exceptional performance in Unity Vector. Our guidance assumes 19%-21% sequential growth rates for Unity Vector. In Create Solutions, we expect 7%-10% year-over-year revenue growth, driven by continued ARPU growth and strength in China. We expect $20 million in non-strategic revenue in the third quarter, driven primarily by the July contribution of Supersonic. We're guiding the third quarter adjusted EBITDA of $185 million-$190 million, implying adjusted EBITDA margins of 33% and adjusted EBITDA growth of 69%-74%. The third quarter is expected to be our sixth straight quarter of adjusted EBITDA margin expansion, with margins up 400 basis points from the second quarter alone and up 1,000 basis points year-on-year. Expected margin expansion is a function of additional operating leverage, amplified by cost reductions enabled by our strategic actions, resulting in a structurally more profitable business. Lastly, we're pleased to report that we're pulling forward our expectation for achieving GAAP net income profitability from the fourth quarter of 2026 to the third quarter of 2026. In closing, we are incredibly pleased with Unity's second-quarter financial results and outlook for the third quarter. Unity has now entered a new chapter, structurally faster revenue growth combined with enhanced profitability. Powered by a flywheel of more games, more platform usage, and more discovery, all driven by runtime and Vector AI. With that, I'd like to thank you for joining us on Unity's second quarter 2026 conference call. I'd now like to turn the call over to Alex so that we can take your questions. Thank you, Jarrod. Operator, we're ready for questions. We will now begin the question and answer session. Please limit yourself to one question and one follow-up. If you would like to ask a question, please raise your hand now. If you've dialed into today's call, please press star nine to raise your hand and star six to unmute. Please stand by while we compile the Q&A roster. Your first question comes from the line of Matthew Cost with Morgan Stanley. Your line is open. Please go ahead. Morning, everyone. Thanks for taking the questions. Matt, there were some comments in your prepared remarks that sort of alluded to a positive feedback loop between Vector and the Create Solutions business, and it sounds like maybe even more specifically, Unity AI. I was wondering if you could expand a little bit more on exactly how that works and what benefits we could expect the two businesses to drive for each other. Secondly, for Jarrod, it sounds like the runtime fee rollout kind of came towards the end of the quarter. D28 was a big driver of strength for Vector in the quarter. Was runtime fee a material contribution or relatively small? Based on what you've seen so far, what does it tell you about what you can expect that to contribute in the coming quarters? Thank you. Thanks, Matt. Thank you for the question. We were incredibly excited, obviously, about the performance of Vector in the quarter. We've now had four straight quarters of 15% growth, which then stepped up to nearly 23% growth in the second quarter, and we're really excited looking forward as well. It's incredibly important that what we've been able to do through continuous product enhancement, improving the quality of our data, and compounding our model improvements, that we've been able to drive significant gains for customers, which therefore drives our business. We're really, really pleased about that. I mentioned one of the product enhancements in the prepared remarks, our Day 28 ROAS product. There were many more. To your point, we did call out runtime, which was, as I mentioned, a historic achievement for us, something that's been long discussed. We have always believed that this will be the primary strategic advantage for us going forward in this business. Every major participant in this world has an approach. If you're Meta, you own your apps. If you're us, you have access to the 3 billion people playing a made-with-Unity game, and that's going to put us in a really good spot over the long term. We began implementing signals from the runtime into Vector towards the end of the second quarter. We're super pleased with what we're seeing. We are having continued success around customers continuing to opt in to our data development framework, which sits underneath all these efforts in runtime. That's going to continue. Although it's still very early, we're very excited about what we're seeing. I don't know if there's any analytical value for anyone to single out the impact of runtime data. Our performance, as we've noted, is the sum of the impact of all the product enhancements, the higher-quality data, and the compounding model improvements. These impacts are self-perpetuating as our system continues to learn in real-time. We expect it to be a driver of our success over the long term. As you guys remember, there were many times I said that, "Look, what we're going to see is solid incremental growth, followed occasionally by step change functions." That's exactly what we experienced and to exactly what we expected. Finally, to your point about the flywheel, I did want to spend some time on it in our opening remarks because I do think that historically, folks have thought about our businesses as separate. Of course, we report it in separate segments. At a matter of strategy and at the level of product usage and how we connect with customers, these businesses are not separate. What we're really excited about is that we can see the fundamental value of our platform really coming into play. If you think about it this way, as we open up Unity, as we have with Unity 7, as more games are created and more creators come into the market and game creation becomes more efficient, there are a lot more games that get released. We are thrilled about that dynamic. We don't care how people access the Unity UI, the application itself. The application layer is just the surface piece. What's really important is we drive as many people as possible into our full integrated authoring platform, which helps creators deploy and monetize and grow their experiences at scale. As more games enter this platform, we benefit because we're able to deliver Vector, our commerce solutions, and our live service solutions. Finally, as more and more games come onto our platform and become successful and go into the marketplace, the need for discovery becomes ever more important because it's harder and harder for consumers to figure out what is the next game they want to play because there's so many more games in the market. Our ability to help our customers predict which one of those consumers is going to install their game accelerates our ad business. That's the flywheel. Folks historically are very focused on the Unity application. It's just not how we think about it. It's not how it works. More folks create interactive entertainment, more folks on the platform, more need for advertising. This process is one that is still at the relative beginning. As I've noted before on the call, and I think we've discussed before, AI is going to make the creation of interactive entertainment much easier over time. You're going to see a massive expansion of TAM for the interactive creation marketplace. Although we haven't talked about that a lot today, it is very much on the horizon for us and very much something we're thinking about, and we'll probably end up talking about that a lot more in the future. Thanks for your question. Great. Thank you. Your next question comes from the line of Alec Brondolo with Wells Fargo. Your line is open. Please go ahead. Yeah. Hey, guys. Thank you so much. I appreciate the question. Perhaps I'll ask two. Unity AI, I would love to get a sense from you as to how you balance the need to preserve margin and unit economics relative to the amount of credits you include in each of the subscription tiers. How do you think about finding that balance, delivering enough value to the customer while protecting the bottom line? That's the first question. I think the second question is on payments. You announced Unity Commerce last October, IAP SDK 5.4 released several weeks ago. It includes most of the functionality you talked about wanting in the product when you announced the initiative. Since that initial announcement last year, how have your thoughts in terms of the addressable customer or customer needs evolved in payments? Hey, thank you so much for the question. Let me take Unity AI first. Our Unity AI product went into open beta in May, just so everyone's on the same page. It's an integrated agent that's tuned specifically for Unity game development. It's still very early, just still in beta, but the results have been really encouraging. For many tasks, because the harness we built, we've been able to build with our unique insight into our software, Unity AI is very often more effective than outside frontier models and virtually always more efficient, which is key, than frontier models. The product really helps our developers leverage the full power of Unity. Our goal and our strategy here is to give developers a choice. You can use our bespoke AI or use your own. We don't care. Our primary goal is to maximize the usage of the authoring platform that I was just describing to Matt. We're not looking to restrict our customers, and which is why we open up both our CLI and our API in Unity 7. I also want to let you know that we are really currently just seeing a fraction of the functionality that we have planned in Unity AI. We're just really excited about the future of that product. Ultimately, our ambition is to use Unity AI and our runtime data to offer a complete tool set for game developers. What I mean is, recall that Unity AI is useful for developers not just in coding assistant, but ultimately it's going to enable real-time personalization of content creation at scale, so that customers can change the way they build games to optimize experiences for players at an individual level. There's so much more interesting going on here than just coding and UI assistance, where the product is currently, as happy as we are about it's really still very much at the beginning. The Commerce product, we're really pleased to announce that the product went into general availability in June 30th. This is an amazing opportunity for us, the opening of commerce opportunities, and things are moving really fast. A lot of estimates are showing that direct-to-consumer monetization within mobile gaming is already around 15% of the overall market. Just to remind everybody, our product is completely free to developers. We're really pleased with the early feedback. We're actively onboarding new partners. We recently published an example of a new partner, a terrific game publisher in Hutch, who's using the Unity IAP product to add direct-to-consumer purchasing for one of their top games, Top Drives. Like many customers, they're able to achieve this without any added complexity or the need to manage multiple or separate SDKs or stores. It's sort of the perfect example of how our platform can provide more value to the games ecosystem over the long term. There are three main benefits of the Commerce product. It expedites and simplifies the process for publishers to circumvent high fees. It gives us visibility into the rich purchase behavior data, which further optimizes our ad models. There is some small economic benefit to us as well, which scales over time. The product's been really well-received. This is a long-term growth opportunity, and we're really pleased to be able to have successfully integrated into our offering. Your next question comes from the line of Clark Lampen with BTIG. Your line is open. Please go ahead. Hey, guys. Good morning. Did I get all three unmuted here? Can you guys hear me okay? Yes, we can hear you. Okay. All right. Perfect. Thank you guys very much. Vector growth 23% in the quarter, you're guiding 20% in the forward quarter. Maybe I've missed this in the past, but I don't think I've heard you guys call out step function model improvements on a quarter-by-quarter basis. Has that been a driver historically or something that we should think about as a potential future opportunity? I'm just thinking about the range of product releases and evolution that you've talked about on this call and on recent ones, and wondering if that's something that could drive accelerating or improving momentum from a development standpoint. Thank you for the question, Clark. The short answer is yes. In my prepared remarks, when I noted that AI is a real driver of product velocity and quality, this is one of the areas that I was thinking of. As I noted, we delivered more than 20 product enhancements to Vector during the second quarter. It's just an incredible rate of progress. The way I would think about this business is that progress comes across all three of the important elements of a performance model. You need continuous product enhancement, which we are accelerating, the velocity of which is accelerating, and which we feel we have lots more to do. Every quarter won't be as busy as this quarter in terms of product enhancements. We're not going to do 20 product enhancements every quarter. We are going to continually enhance the product as quickly as we possibly can. Product enhancements are just one leg of that stool. The second leg of the stool is higher-quality data, better signal. That's what I'm referencing when we talk about the long-term benefits of runtime as an example, but there's also lots of other routes for us to improve the quality of our signal and the depth of our signal. When you have product enhancements and you have higher-quality data, you also give your model the opportunity to learn and improve and tune itself as a self-learning model does. Each time you make product improvements and improve data, your model has an opportunity to get more efficient. It's all three of those drivers that are driving significant gains for our customers. We just were very confident that we're going to be able to continue that process over time, as we continue to benefit from what we think is a long-term strategic moat we have around runtime. Okay. That makes sense, and is really helpful. Maybe as the follow-up here, I wanted to ask a question related to the Netflix partnership, and the very basic question is, to the extent you're comfortable sharing more detail around the scope and potentially even the economics of this, how is the initial working relationship taking shape, or how is it going to affect your customers? Thanks. Yeah, as I mentioned upfront, what we love about the Netflix relationship is that it's emblematic of the kinds of significant platform relationships we have with virtually all of the major gaming platforms in the world. It's very rewarding, and we're really pleased that Netflix chose us. It's an important multi-year deal that calls for us to invest in support of their gaming initiatives on their platform, and ensure that those games work well, that our developers can easily build games that function on the Netflix platform. Which helps us expand the opportunities for our developers. This is what we're all about. Expand access to games for a new set of consumers that might not have played before or that haven't had the opportunity to play on that platform. What's interesting and exciting about Netflix is that it's important to remind folks that there are always new platforms developing, and that interactive entertainment is a fundamental human desire. Consumers love and will always love playing games. Platforms rise and fall, they grow and shrink. There's all sorts of cycles. New platforms and innovation always come to the fore, and players will always love playing games. We are really excited to be in a position to help platforms, any and all platforms, be optimized for Unity, because Unity is by far the leading platform for game making in the world. That's what we're so excited about. Thank you. Yeah, Matt. Your next question comes from the line of Vasily Karasyov with Cannonball. Your line is open. Please go ahead. Thank you. Good morning. Matt, I wanted to ask you to go into more detail, please, if you can, on Unity 7. I know you said in your prepared remarks that it's a new frontier product for you. Can you explain to us in simple terms, please, how it's different from the previous generation and how you see it supporting growth in both of your segments? Thank you. Thank you, Vasily. I'm happy to do it. I could talk about Unity 7 all day. Very excited about the product release. I think the most important thing to remember is that this isn't just another engine upgrade for us. It's a complete change in how developers are going to interact with our technology, and how they're going to utilize coding agents in concert with Unity, and how they're going to collaborate with their teams. What we did effectively was re-architect Unity so that a team of both creators and coding agents could work together side by side across every stage of game development together using Unity. Previously, that was not possible. It was very difficult to connect your coding agents to Unity, and it was impossible to really collaborate with multiple parties. It was very much a single-use experience. Being able to partner with other people and with coding agents in unlimited numbers to make interactive entertainment is a fundamental shift in the way Unity works. At the same time, a big part of Unity 7 was that we accelerated every part of the development process because one of the things we discovered is that when you expose Unity to coding agents, which are working extremely quickly and relentlessly, we saw that sometimes our software was the bottleneck in the speed of development. We also had to go back into the laboratory to accelerate lots of parts of the development process so we were never the thing that was making developers wait. Maybe even most importantly, we've done all of this in a way that will not require our customers to do a traditional upgrade. Nothing will break. Everything that works in Unity 6 will work in Unity 7. There is no languages to learn. There is no barrier whatsoever. That is a major change to the way we have built Unity in the past. I would also note that I believe the wait between Unity 5 and Unity 6 was something like seven years. We were closer to 18 months, and that's going to continue to accelerate. It is a very different product than it was before. You asked for me to be clear and simple, I'm not going to talk about in too much depth around each one of the really important technical features that we upgraded. Suffice it to say that we sped the quality and the fundamental nature of the way games are rendered. As I mentioned, enhanced the collaboration, enhanced the ability for folks to make live changes so that you're building a game, you make a change in code, and you can literally see it running in the game you're building in real-time. Make a change, see the change in the game. Right? If you think about how fast that is, especially if you're using coding agents or multiple coding agents and multiple people together, all these advancements are really a fundamental change and it opens Unity to folks beyond engineers. Those agentic workflows are going to enable faster iteration, which ultimately, and this is the most important part, is going to enable people to make deeper and more beautiful games and more of them. None of this technology is designed to replace people. Great interactive entertainment will always have the spark of human creativity. Great interactive entertainment is not going to be built by sort of the average of all the games that have been built before, which is effectively what language models are giving you. What this does is open up all those tools to accelerate innovation, and folks are going to create amazing, differentiated, new things that we have never seen before with this, and that's going to drive growth in the industry, and we're really excited to be a part of it. Thank you. Your next question comes from the line of Eric Sheridan with Goldman Sachs. Your line is open. Please go ahead. Thanks so much for taking the question. When you guys couple the operating momentum you have now with the completion of all the corporate actions you've been putting in place to align the business for the long term, how would you think about long-term incremental margins in the business from both a business mix perspective, also the balance you would likely have to strike between maintaining that momentum with growth investments and letting some elements of just the pure incremental margins of this mix flow through to the bottom line, just if there's a framework you're thinking through? Thanks so much. Maybe just a minute of history, then I'll let Jarrod take the rest of that question, Eric, thank you for the question. It is quite exciting for us to take a step back for a moment and think that two years ago, Vector wasn't even a thing. Six quarters ago, it wasn't a thing. It's now by far our biggest and fastest-growing business, significantly more than $1 billion on a run rate. two years ago, our Create business was in decline. It's now a healthy growth business with a product roadmap we're incredibly excited about, with straight quarters of sequential growth and acceleration. Couple years ago, our adjusted EBITDA margins were in the low 20s. We're now approaching 30. As Jarrod noted, we expect to be GAAP profitable for the first time ever. Our free cash flow on a quarterly basis has more than doubled, as Jarrod mentioned in his remarks. We're really excited about the mix of businesses we're operating and very excited, to your point, about having shed slower-growing, less profitable businesses. As I noted, we've been able to significantly grow revenues while also growing profitability. We expect to continue to be able to do that. That is our strategy. We expect to have our cake and eat it too. There are continued efficiencies we can find in our business. We will have continued rapid revenue growth, and we continue to look for ways to structure our business so that we continue to invest in high-growth activities by making choices and prioritizing the things that we do, which is the most critical piece of a well-operated business. That's as true in lean times as it is in good times. In fact, it's even more true when things are going well. That's when folks have the inclination to want to start doing everything. We are not going to fall into that trap. We're going to continue to apply capital to our fastest-growing businesses and prioritize those and not get distracted by things that are not creating growth and profitability for us. That's our strategy. I think that's well said. I think the only thing I'd add to what Matt reviewed was, Unity is blessed with structurally high contribution margins. If you look at our adjusted gross margin, they've been about 82%, up to 83% in the second quarter. As we invest in our business, there are short periods of investment followed by periods of revenue realization that allow for very high levels of ROI on those investments, and we're seeing that repeatedly in our business. Investment followed by revenue realization, followed by ROI and operating leverage in the business. We're very pleased with that. We've experienced 200 basis points of margin expansion each quarter since the first quarter of 2025. Based on the strategic actions we've recently executed, we're looking at 400 basis points of operating margin expansion, of EBITDA margin expansion in the third quarter alone. We also believe that there is further opportunity for margin expansion in the business. We are doing that all along the while investing in our product roadmap. That is right now, first and foremost, our job is to continue to make sure that these high ROI opportunities for accelerating our business, for accelerating the value that we provide to our customers, are fed through our cash flows and through our P&L. Despite investing in those opportunities, we're still seeing the operating leverage, and we're still seeing the margin expansion. I think we're in rare air right now, and that virtuous cycle has really taken off for us in terms of investment, margin expansion, and operating leverage. Your next question comes from the line of Andrew Boone with Citizens. Your line is open. Please go ahead. Thanks so much for taking the question. Jarrod, I wanted to go back to, or Matt, excuse me. I wanted to go back to Unity 7 and think about how we should be thinking about the cross-sale in terms of the advertising business and then core Create. You mentioned it earlier, it's always been this massive opportunity for Unity. Can you really unpack that as we start to think about 2027 and the next generation of Unity, of bringing those two sides closer together? Absolutely. The most important thing I could deliver as an idea for you all to think about our company is to go back to the framing offered up front about the flywheel and how we see our platform and the use of that authoring platform, including Vector, as the primary driver of our business going forward. As more games get created with our authoring platform, those games. Think of it this way. When you create a game, you've created a thing, and it exists in your world, there are no consumers playing that game. There is no monetization in that game. It can't be updated. It's not being offered in live service where hundreds of millions or billions of people can play it, right? All the deep underlying systems and infrastructure that go into operating a massive live service is done on the Unity platform. The ability to acquire new users, which especially in mobile, is literally the lifeblood of the revenue of every mobile game, is done using our Vector platform. The ability to build a storefront and take IAPs we talked about earlier is something that is, that functionality is fully integrated into the Unity platform. When I was asked a question about Unity AI, I talked about the opportunities that we have to deliver added value to our game creators in the form of giving them tools to help build more customized, personalized, more exciting experiences. All those tools that sit on the platform are what we're really excited about. Folks tend to focus just at the application layer, which is the least interesting part of this. We open up the funnel to as many creators as possible. They build games. Those games drive use of our platform. Vector is the very, very big part of that platform. What I mentioned earlier, remember what I said was that when folks use coding agents Rather than going into the Unity application directly and working with our UI, we're also able to configure all these platform elements automatically for them, and it's just built in. Not only the process, the AI that is driving this, not only drives more content creation, and we think it's not only driving more innovations, but it's driving easier and more use of our platform. As that happens, we will earn money downstream from services, from live operating services, from Vector, from other things. That is the flywheel we are trying to explain and why we're so excited about this. Last thing I'll say about it, we are only just beginning to scratch the surface of the number of people who are building interactive entertainment. AI is going to make it much easier for consumers to do. I am fond of saying creation is the new consumption. What I mean by that is we believe that tens of millions of new folks will begin creating interactive entertainment just as they today create linear video. You're making TikTok videos, you're making YouTube videos, you're posting on Instagram, whatever you're doing. Every one of those creators ultimately is going to become a creator of some kind of interactive entertainment because the technology and our tools are going to enable them to do that. Because interactivity is the only way to increase engagement over linear video, which is spectacular, but can only ever be so engaging. Whereas interactivity can create effectively infinite engagement loops. There are going to be tens of millions of people who are doing that. We are opening our software and opening our platform to welcome those folks who are now going to be able to use Unity, and we're going to be having further announcements about this over time. We're now going to be able to use Unity in a way that they were not able to before. That is the state from professional users who I was addressing slightly earlier in this answer, who are building multi-billion-dollar games or using our platform, using Vector. That's going to grow, but the market size is also going to grow with lighter and different forms of interactive entertainment that other folks are going to build. We're going to see both an extension of our historical professional customer set ultimately, as well as the expansion of a more kind of, I'll call it a prosumer over time, a creator class. All that's going to be enabled by opening our software to coding agents and collaboration between people and coding agents, which is effectively how modern interactive entertainment is going to be built. I hope that's helpful. Thanks, Matt. Your next question comes from the line of Dylan Becker with William Blair. Your line is open. Please go ahead. Hey, Matt, Jarrod, Alex, appreciate it. Might be a little late to the party here, Matt, but congrats on the Knicks championship recently. Thank you very much. It's not as important as the quarter, but it's very important. It certainly helps. Yeah. I want to touch on the I know we've talked about the flywheel pretty extensively here, Matt, but maybe if you could characterize the components of the flywheel or how you're interpreting those between some of the platform advancements. We talked about the excitement around the future roadmap of the business, but how much of that is initiatives that are already ramping and scaling and seeing success that are driving conviction in that? Maybe how that kind of fuels incremental stuff that we're not yet seeing today, but opening the aperture on things that you can develop into the future. If you could weigh between those two, if that makes sense. Yeah. Look, the best way to figure out how much value and improvement we're driving is to track revenue growth. As I talked about earlier, when our customers are seeing return, they're spending more with us, and our revenue goes up. Revenue is in fact a direct output of the quality of that three-legged stool I talked about. The quality of the nature of our product releases, the quality and increases to the quality of the data that drives Vector, as well as our ability to improve the efficiency and accuracy, and tuning of our models. Those three legs of the stool are what drive this forward. As I mentioned, every quarter, we are working as fast as we possibly can to implement as many positive changes to all three legs of the stool as we can. Our self-learning algorithms are always working. We're trying to put as many new product enhancements as we can into the marketplace, and we are always working on enhancing data. The long-term benefits of access to runtime data, which we're now six, eight weeks into, are going to be substantial. The long-term advantages of this flywheel I described, where more and more games are going to be created on our platform, which are going to be automatically integrated with that platform, which includes Vector, is going to drive a lot of growth in the future. We are very bullish about continuing to put our heads down and work across all three of those main legs of the stool. We're really very bullish about the ability of our platform and that flywheel to keep spinning and, in fact, to increase the velocity with which it is spinning. That is the way we think about this business. Very helpful. Thank you. Your final question comes from the line of Omar Dessouky with Bank of America. Your line is open. Please go ahead. Hi. Thank you. Can you hear me? Yes. Great. Could you maybe just give us an update on where you think you are in terms of advertiser penetration as sort of like a percent of all the advertisers in the market, how that's trended over time and what you're doing to accelerate that adoption? Or if you need to do anything at all in that advertisers just come to you when they see returns. Hi, Omar. Thanks for the question. I would say that by and large, in the game space, the vast majority of folks already do know who we are and are already spending with us to one degree or another. There's a lot of dynamics in this market, a tremendous amount of growth in Asia, and in particular, new entrants come into the market all the time. We've been doing this for quite some time, and good news travels fast in our world. Remember I was saying before, as you know better than anyone, new installs are the lifeblood, especially in the mobile game business. If folks are seeing return, and this is a very competitive business and everybody's tracking everybody else, they can see that something's going on and they will generally reach out to us. We already know them. As I said, they're already probably spending with us. It's not as if the issue for us is we've got to ramp up some big new sales force to ring doorbells to try to get folks to try Vector. It is much more of what I describe as an optimization and account management function in which we test and scale individual games and do the work around data and integration to ensure that we are able to deliver as much scale and as much value as we possibly can for each advertiser. That is more of the dynamic, and it's playing out in a really positive way for us. This concludes the question and answer session. I will now turn the call back to Alex for closing remarks. Thank you, everyone, for joining this morning. Have a great day.