Google Genie 3 rollout hits gaming stocks, but analysts see limited long-term impact
Published At: 31 Jan 2026
India TV News
Google's rollout of its advanced generative AI technology, Genie 3, has triggered a sharp sell-off in global video game stocks. While investors fear disruption to traditional game development, analysts believe the market reaction is exaggerated and expect stability as earnings season approaches.
New Delhi:
Google has yet again shaken up the gaming world by giving its US-based Google AI Ultra subscribers early access to Project Genie 3, and the news soon rattled the investors. Video game stocks took a hit as people started worrying about what generative AI like Genie could mean for the future of gaming.
Freedom Capital says the sell-off happened fast. Investors panicked, thinking AI tools like this might disrupt the whole industry. Google says it’ll roll out Genie 3 to more countries soon, but for now, it’s only available in the US.
So, what’s Genie 3 all about?
Basically, it is a powerful AI tool that lets anyone create, explore, and remix digital worlds just by typing a prompt or uploading an image. Google first showed it off in August 2025. The big pitch is that it makes building virtual environments way easier for everyone.
Three things stand out with Genie 3: you can sketch out worlds with prompts or pictures, explore those worlds as the AI generates them on the fly, and remix environments in real time. You can also swap between first- and third-person views and make instant edits to characters or scenes.
AI replacing game developers
After Google’s announcement, some big names in gaming and tech saw their stock prices drop. Unity, Roblox, Take-Two Interactive, Nintendo, and AppLovin all felt the pressure. Still, Freedom Capital thinks the market freaked out a little too much. They say worries about AI replacing game developers are overblown—at least for now.
Take-Two Interactive’s earnings are coming up on February 3, right on the heels of all this AI buzz. The company is worth about USD 40.44 billion and posted nearly 14 per cent revenue growth over the last year. Even though its shares trade just above what analysts see as fair value, most experts feel good about the stock. Their price targets range from USD 160 to USD 300, so expect some ups and downs in the short term.
Despite the anxiety over AI, analysts have not lost faith in Take-Two.
Jefferies still says to 'buy' with a USD 300 target. Wells Fargo bumped its target to USD 288. BMO Capital and TD Cowen are both bullish, aiming for USD 275 and USD 284. Sure, Grand Theft Auto VI got delayed, and that stings, but strong sales in their NBA games and GTA Online keep Take-Two’s long-term outlook solid.
