New York, February 1, 2026, 05:37 ET — Market closed.
- Unity shares ended Friday at $29.10, down 24.2%.
- Alphabet’s Google rolled out “Project Genie,” an AI tool that generates interactive worlds from prompts.
- Investors now look to Unity’s Feb. 11 results for the next catalyst.
Unity shares closed Friday down 24.2% at $29.10, ending a volatile session that ranged from $38.03 to $27.54. About 86.9 million shares changed hands, company data showed. (Unity)
The drop followed Alphabet Inc.’s Google unveiling of an AI model dubbed Project Genie that can create interactive digital worlds from text or image prompts, raising fresh worries about what gets automated inside game engines such as Unity and Epic Games’s Unreal Engine. Shares of Take-Two Interactive fell 10% and Roblox Corp. was down more than 12% in afternoon trading. “We’ll see a real transformation … once AI-based design starts creating experiences that are uniquely its own,” said Joost van Dreunen of NYU Stern School of Business. (Reuters)
Google said in a blog post on Thursday that Project Genie is an experimental research prototype powered by Google DeepMind’s Genie 3, a “world model” — AI that simulates how an environment changes as you move through it. Access is rolling out to Google AI Ultra subscribers in the U.S., with generations capped at 60 seconds, it said. (Blog)
Unity Chief Executive Matthew Bromberg tried to put a floor under the narrative in a LinkedIn post, writing: “Rather than viewing this as a risk, we see it as a powerful accelerator.” He argued that world-model outputs remain probabilistic — they can change from run to run — and still need deterministic systems for consistent, repeatable play. (LinkedIn)
For traders, the weekend pause may not mean much. Big one-day drops like Friday’s can invite bargain hunting, but they can also drag in systematic selling and tight stops when the market reopens.
The next scheduled test is February 11, when Unity is set to release fourth-quarter and full-year results before the market opens, followed by a webcast at 8:30 a.m. ET, the company said. (Unity)
But there’s a clear downside case. If investors decide Project Genie points to a future where engine tooling becomes cheaper and more commoditized, Unity’s path back to steadier growth looks harder — and any stumble on guidance could keep pressure on the shares.
When trading resumes Monday, investors will watch whether Unity stabilizes after the slide. The next hard catalyst is February 11, and what management says about AI-driven creation on that call.
