Shares of all kinds of companies are now routinely upended by new AI launches.
Major gaming and entertainment companies saw their stock prices plummet on January 30, 2026, following Google’s public release of its Genie 3 world model to Ultra users in the United States. The AI model, which generates interactive 3D game worlds from simple text prompts, appears to have spooked gaming industry investors and they seem to have scrambled to assess the implications for traditional game development.
Take-Two Interactive Software (NASDAQ: TTWO), the publisher behind Grand Theft Auto and other blockbuster franchises, saw its shares drop 7.93% to close at $220.30. The company has been particularly vulnerable to concerns about AI-generated content, given the multi-year development cycles and massive budgets required for its flagship titles. With GTA VI still in development after years of work, the emergence of technology that can create playable worlds in minutes has raised questions about the future viability of such lengthy, expensive development processes.
Roblox Corp (NYSE: RBLX) experienced even steeper losses, with shares falling 13.17% to $65.76. The user-generated content platform’s business model centers on creators building experiences within its ecosystem — a proposition that could be fundamentally challenged by AI tools that generate similar content automatically. Investors appeared concerned that Genie 3 could democratize game creation beyond Roblox’s platform, potentially eroding its competitive moat.
CD Projekt SA (WSE: CDR), the Polish developer known for The Witcher series and Cyberpunk 2077, saw its shares decline 8.00% to 259.80 PLN. The company’s market value has been particularly sensitive to technological disruption, having already weathered criticism over Cyberpunk 2077’s troubled launch. The prospect of AI-generated game worlds raises existential questions for studios that have built their reputations on hand-crafted, narrative-driven experiences.
Unity, which closed at $29.10 after falling 24.22%, represents the most severe single-day decline among gaming stocks following the Genie 3 announcement. The magnitude of the drop reflects broader industry anxiety about how quickly AI could transform — or potentially replace — traditional game development workflows.
Genie 3, which Google DeepMind first unveiled in August 2025, represents a significant leap beyond traditional video generation AI. Unlike static video models such as Google’s own Veo3, Genie 3 creates persistent, interactive environments that respond to user inputs in real time. The worlds generated by the model maintain memory of player actions and simulate realistic physics, creating experiences comparable to professionally developed video games — but requiring only text prompts and minutes of processing time rather than years of human labor.
The model’s public release on January 30 gave users their first hands-on opportunity to test its capabilities. Early adopters quickly demonstrated Genie 3’s versatility, creating everything from historical recreations of San Francisco in the 1900s and New Amsterdam in the 1600s, to functional roller coaster simulations and surreal environments like a hall of mirrors or a first-person view navigating Penn Station as a cigarette pack. The breadth and quality of these user-generated worlds underscored the technology’s potential to disrupt established game development paradigms.
Genie 3 could aid one of the most resource-intensive aspects of game development: world building. Major AAA titles can require teams of hundreds of developers working for multiple years to create detailed, believable game environments. Take-Two’s Grand Theft Auto series, for instance, has become notorious for development cycles stretching beyond five years. If AI models like Genie 3 can produce comparable results in a fraction of the time, it could fundamentally alter the economics of game development. There are limitations to what Genie 3 can do — and it currently only produce simulations a minute long — but the stock selloff suggests that investors are taking this threat seriously