Does this count as cheating? Need advice.

Im sitting here crying , not knowing what to do. I'm 22 weeks pregnant with my son. My fiancé just admitted to me that while I was away for a weekend ( I was babysitting all weekend for my sister at her house ) he had another woman ( that we both know extremely well) over at our house , and that they got drunk and he plugged in a porn , they watched it he said , but half way through she asked him to turn it off and he did and she left. This happened about 4 weeks ago and he told me he had been planning to tell me but didn't know how ( I found out because I got on his phone and seen the texts between the two of them). I'm so heartbroken , he says I have no reason to be and that it doesn't count as cheating . I tried to explain to him how I see it as cheating and that if it was the other way around he would have seen it as betrayal to. I don't know wether I should leave him over this or try and make it work and forgive him.  Does that count as cheating or am I just overreacting ?