Videogame stocks slide after Google's Project Genie AI model release(reuters.com)
reuters.com
Videogame stocks slide after Google's Project Genie AI model release
https://www.reuters.com/business/videogame-stocks-slide-googles-ai-model-that-turns-prompts-into-playable-worlds-2026-01-30/
55 comments
That's a smart take. However, the cost and time to make GTA6 is mostly baked in at this point.
What I think is likely is that the cost of many other types of games in the future will be reduced because of AI. It's an open question how useful AI will be but I think its clear that it can make a lot of tasks in game making more efficient.
What I think is likely is that the cost of many other types of games in the future will be reduced because of AI. It's an open question how useful AI will be but I think its clear that it can make a lot of tasks in game making more efficient.
[deleted]
>Wouldn't tech that could significantly shorten the timeline back to something closer to a few years like it was 20 years ago - while at the same time massively expanding the scope of the game relative to those - seen as a boost to share value?
Games are already too big and too bloated. I'm not excited for anything along these lines. The best outcome would have been if ballooning game budgets required people to dial back projects and spending so that games were smaller in scope.
If this plays out, we'll see the opposite. LLMs are used to offset the costs of games while they become bigger and dumber than they already are.
Games are already too big and too bloated. I'm not excited for anything along these lines. The best outcome would have been if ballooning game budgets required people to dial back projects and spending so that games were smaller in scope.
If this plays out, we'll see the opposite. LLMs are used to offset the costs of games while they become bigger and dumber than they already are.
I'm more of a 'patient' gamer and this is a criticism I had quite a bit in the past... even GTA5 I lost interest about 25 hours in. A couple years ago I played Stray and was wowed by the art direction and tight if fairly minimal story and playtime.
Cyberpunk has changed my perspective on this. Started last August, now 84 hours in, and I plan to do a completion-ist run of at least 120+ hours. Around hour 50 I could have completed the main storyline which snuck up on me quicker than expected, so I'm trickling in the Phantom Liberty quest-line while chewing thru gigs and side jobs, many of which add a ton of narrative impact.
I remember way back when Sopranos ended and I was fairly sullen for a few months after... similar response to The Wire, Mad Men, Breaking Bad, BCS, Succession. Don't watch TV as a rule, but I immediately stopped what I was doing when a new ep of those dropped. Felt almost like I lost a loved one when each ended.
Pretty sure I'll have the same response to this game, I'm dreading leaving this universe. After that I'll get to Baldur's Gate 3 and probably have the same experience. Then after taking a year to finish that off, will likely move on to RDR2. Maybe by then I'll be able to play GTA6 on my Mac.
Basically, my thinking is that - a premium series is going to be roughly 50-60 hours, so if the story and immersion is there... which it certainly is w/ a game like Cyberpunk, the base game should roughly give a similar playtime. The fact that there is so much bonus content that is lovingly crafted gives players the option to stay longer if they so desire is fantastic given these things are now taking 10+ years to produce.
Cyberpunk has changed my perspective on this. Started last August, now 84 hours in, and I plan to do a completion-ist run of at least 120+ hours. Around hour 50 I could have completed the main storyline which snuck up on me quicker than expected, so I'm trickling in the Phantom Liberty quest-line while chewing thru gigs and side jobs, many of which add a ton of narrative impact.
I remember way back when Sopranos ended and I was fairly sullen for a few months after... similar response to The Wire, Mad Men, Breaking Bad, BCS, Succession. Don't watch TV as a rule, but I immediately stopped what I was doing when a new ep of those dropped. Felt almost like I lost a loved one when each ended.
Pretty sure I'll have the same response to this game, I'm dreading leaving this universe. After that I'll get to Baldur's Gate 3 and probably have the same experience. Then after taking a year to finish that off, will likely move on to RDR2. Maybe by then I'll be able to play GTA6 on my Mac.
Basically, my thinking is that - a premium series is going to be roughly 50-60 hours, so if the story and immersion is there... which it certainly is w/ a game like Cyberpunk, the base game should roughly give a similar playtime. The fact that there is so much bonus content that is lovingly crafted gives players the option to stay longer if they so desire is fantastic given these things are now taking 10+ years to produce.
Still, the market reaction seems hasty and hype driven. A bit wild their stocks got impacted this much. But I guess the market has short term memory.
But, I do agree a lot of things could be sped up. Animation and photogrammetry based modelling (widely used for character's clothing) come to mind. And, it should be used in cases such as these, where it is just a tool. Nothing more, nothing less.
But, I do agree a lot of things could be sped up. Animation and photogrammetry based modelling (widely used for character's clothing) come to mind. And, it should be used in cases such as these, where it is just a tool. Nothing more, nothing less.
Take Two has 13 years of sunk costs they need to recoup.
They will almost certainly do well with GTA 6, but maybe a game that can compete with GTA 6 will be coming out a lot sooner now.
We are a year away from GTA 6, presuming the HQ boiler explosion causes a delay.
They will almost certainly do well with GTA 6, but maybe a game that can compete with GTA 6 will be coming out a lot sooner now.
We are a year away from GTA 6, presuming the HQ boiler explosion causes a delay.
>>It's not like someone is going to prompt up "gimme GTA7 based on what you know about all the past GTAs"
well....
https://www.youtube.com/watch?v=k3u1G3RZsL4
well....
https://www.youtube.com/watch?v=k3u1G3RZsL4
Will AI games be good? I think they could be, but in practice when you reduce the friction what happens is that the signal to noise ratio gets much worse. The market will be flooded with garbage, and so per capita games will become worse, even if the absolute number of good games rises. So, I'm not excited. We already have too many games. The market is flooded and fragmented. There are more games released now than I have remaining hours in my life.
> Will AI games be good? [...] The market will be flooded with garbage, and so per capita games will become worse, even if the absolute number of good games rises.
Funny you use "will be" here, because this is already happening. Have you looked at daily Steam releases lately? It's 90% AI-generated hentai games, asset flips, or AI-generated hentai asset flip games.
Right now the limitations of genAI tech are limiting the types of games that can be pumped out, but Genie is just going to be more of the same; instead of a clearly AI-generated, painfully uninteresting hentai game, you're going to get clearly AI-generated, painfully uninteresting Call of Duty clones. You can ask the developers of Concord, Highguard, Marathon, etc. how successful bland shooters are these days.
Funny you use "will be" here, because this is already happening. Have you looked at daily Steam releases lately? It's 90% AI-generated hentai games, asset flips, or AI-generated hentai asset flip games.
Right now the limitations of genAI tech are limiting the types of games that can be pumped out, but Genie is just going to be more of the same; instead of a clearly AI-generated, painfully uninteresting hentai game, you're going to get clearly AI-generated, painfully uninteresting Call of Duty clones. You can ask the developers of Concord, Highguard, Marathon, etc. how successful bland shooters are these days.
I wasn't aware of this, and this is an important comment. I think the imaginations of the people on HN are really turning with what could be possible in principle. In practice, it looks just like you've described; low quality engagement-focused garbage, just like your facebook and youtube feeds.
Gaming is already flooded with garbage. Pretty much on every level. From cheapest possible shovelware sold for cents. To soulless derivative attempts in live service games. And anything in between. It can probably get worse, but I doubt anything will actually change.
From an art perspective, AI seems to be quite a ways away from someone being able to make a coherent general game.
The self-consistency just doesn't seem to be there to make a coherent playable game (easily, broadly - many types of games, styles, etc).
Music gen AI is pretty good, and with a reasonable amount of finagling, you might be able to pull that off generally.
From a coding perspective, you can probably make simple games with minimal skills already, and I can definitely see it being possible to create pretty sophisticated games with minimal bugginess with minimal coding skills in the near future.
Is that combination good enough? I doubt it outside of niche games for quite some time
The self-consistency just doesn't seem to be there to make a coherent playable game (easily, broadly - many types of games, styles, etc).
Music gen AI is pretty good, and with a reasonable amount of finagling, you might be able to pull that off generally.
From a coding perspective, you can probably make simple games with minimal skills already, and I can definitely see it being possible to create pretty sophisticated games with minimal bugginess with minimal coding skills in the near future.
Is that combination good enough? I doubt it outside of niche games for quite some time
> Music gen AI is pretty good
Is it? I have quite a few friends that are relatively successful music producers/djs, and they don't seem impressed. A lot of music gen AI fails to match prompts at all. Maybe I am using the wrong tools.
It also seems quite difficult to iterate on a sound.
Is it? I have quite a few friends that are relatively successful music producers/djs, and they don't seem impressed. A lot of music gen AI fails to match prompts at all. Maybe I am using the wrong tools.
It also seems quite difficult to iterate on a sound.
Are you talking specifically about Genie?
Yes, I've played a lot of indie hobby-tier niche games and I will say that AI assets are a big help for solo hobby devs who wouldn't otherwise be able to finish the game. At the same time, the AI art is noticeably inconsistent in an 'uncanny valley' way that breaks immersion, making the game quality poor.
It is definitely a new frontier. How do you review a game that isn't reproducible? Similarly how do you do play testing? You don't get the same "shared experience" outside of multiplayer and people experiencing it together. It is taking current generation procedurally generated games to the next step, but where do you find a threshold of "this blob of constraints is _the_ game"?
I'm not saying that video games should be confined to today's paradigms, I'm just happily curious to see what will happen with it.
I'm not saying that video games should be confined to today's paradigms, I'm just happily curious to see what will happen with it.
Sounds like an increased demand for game critics. Or perhaps the same thing that has happened with web search will apply (at least in my experience)--less clicking on search results, more going directly to trusted sites. Less trying out new studios and IPs, more gamer brand consciousness and loyalty?
That's a likely adaptation, yes, but there is no real market demand for a higher volume of (mostly) lower quality games. So will we all adapt, yes, but much like web search it would have been better if it were never ruined in the first place.
You can't be serious, do investors have smooth brain? GTAVI is about to be released (will probably break all kinds of records) and they think Project Genie a prototype of an experimental idea has any impact on the games industry?
GTA VI by itself will make about 30 googles of money and then T2 stocks go to the moon. These people only react on a minute by minute basis, what can one expect?
Even T2's CEO doesn't dare tell Rockstar what to do (said it himself), they deliver everytime and make him all the money he wants.
Even T2's CEO doesn't dare tell Rockstar what to do (said it himself), they deliver everytime and make him all the money he wants.
But there are growing concerns with GTA VI due to almost complete change of the leadership at Rockstar (Dan Houser, producers, writers). I wouldn't bet money on VI being as big of a hit as V or even IV.
Good. Video games are being ruined by shareholders demanding returns over good games. The less public investment there is, the better.
Just which prominent publishers remain private, anyway? Besides Valve.
Epic.
Haha, yes, ruining games by that hated public video game studio, Nintendo
Yeah I don't even agree with the conceit that public investment is causing companies to make bad games. You don't make 'good returns' as a video game company with bad video games, I don't care how fancy your financial engineering is. And private investors care about returns just as much as public investors do.
If anything a lot of this is on gamers for continuing to buy shitty games that they complained even at the time were shitty games.
If they'd stopped buying games the lousy companies would have folded, their investors would have eaten a loss, and the game companies that remained would care more about the investors who'd shown more of a long-term focus.
If anything a lot of this is on gamers for continuing to buy shitty games that they complained even at the time were shitty games.
If they'd stopped buying games the lousy companies would have folded, their investors would have eaten a loss, and the game companies that remained would care more about the investors who'd shown more of a long-term focus.
[deleted]
Gamers hate AI art as it is, developers hate unreliable AI made code. Lets make something with both.
Gamers words are not worth shit, and the industry has known this forever.
DLC was the worst thing to happen to gaming, gamers hated DLC, they still hate DLC, but...
They spend a few billion a year on it, and each year spend more and more. Companies follow money more than they follow social media rants.
DLC was the worst thing to happen to gaming, gamers hated DLC, they still hate DLC, but...
They spend a few billion a year on it, and each year spend more and more. Companies follow money more than they follow social media rants.
When it comes to revealed preferences vs. stated preferences, "Gamers" probably have the wildest difference between them.
Games shouldn't cost $70!! [consistently pays $70 for games]
Game sequels suck, they're just rehashes of previous games!! [buys the sequels anyway]
Games shouldn't have AI content! [buys games with AI content]
Microtransactions are terrible! [pays for microtransactions]
Loot boxes are ruining games! [plays games with loot boxes]
Anti-cheats are rootkits. They are unacceptable! [plays games with anti-cheat]
That's it, they crossed the line. I'll never buy that game! [buys the game]
Games shouldn't cost $70!! [consistently pays $70 for games]
Game sequels suck, they're just rehashes of previous games!! [buys the sequels anyway]
Games shouldn't have AI content! [buys games with AI content]
Microtransactions are terrible! [pays for microtransactions]
Loot boxes are ruining games! [plays games with loot boxes]
Anti-cheats are rootkits. They are unacceptable! [plays games with anti-cheat]
That's it, they crossed the line. I'll never buy that game! [buys the game]
This is a classic example of Goomba fallacy.
Even if they're different people, they must be a vocal minority since the games that they seem to complain about tend to be the ones that sell the most copies
As someone that mostly plays relatively niche games, I love DLC. I went from getting a game, then an expansion if I am lucky to getting a game with constant development for 10 years. Ill happily pay $10-20 for my favorite niche sandbox games to give me another 100 hours of play time.
A DLC and AI slop is not the same thing. Tho Steam reviews will burry both AI slop and bad DLC accordingly. And players do care about reviews.
Most gamers don't care about AI use provided it's not too egregious (like the latest call of duty). Only a vocal minority on Bluesky and Reddit.
Arc Raiders uses AI in various ways yet it's one of the biggest success of 2025.
Arc Raiders uses AI in various ways yet it's one of the biggest success of 2025.
Vocal gamers care, majority market gamers dont.
They will continue to buy three reskinned Ubisoft sandboxes a year and two seasonal sports releases.
The industry is already forfeit.
They will continue to buy three reskinned Ubisoft sandboxes a year and two seasonal sports releases.
The industry is already forfeit.
Also children probably don't care.
To understand whether AI world models could replace traditional video games, it might be useful to compare this to how LLMs have affected old-school role-playing games. LLMs are more mature and have been around longer than AI world models so we should've seen the shift there first.
I don’t personally know anyone who role-plays, so candid question: have LLMs changed the way people play tabletop RPGs?
I don’t personally know anyone who role-plays, so candid question: have LLMs changed the way people play tabletop RPGs?
Yes, they absolutely have. The use of AI chat bots for role playing is now fairly commonplace, and not just for sex chat. Silly Tavern and Kobold are major tools for running those locally.
There are numerous guides for integrating an LLM as a sort of automatic game master when _also_ following solo play variants of major TTRPGs. You can find these on reddit and drivethrurpg.
There are numerous guides for integrating an LLM as a sort of automatic game master when _also_ following solo play variants of major TTRPGs. You can find these on reddit and drivethrurpg.
Interesting, I didn't expect that. I guess stock markets have a good reason to worry about video game studios then. Now, makes me wonder if movie companies stocks were similarly affected when major video models were announced.
The video games industry is suffering a lot of headwinds, so it's misleading to call this the major driver. Studios have been shutting down for 18+ months. Ubisoft stock is at a ~15 year low as are most big publishers. Many big titles fell flat in 2025 (and there were some surprise wins too -- not all doom). Console sales fell off a cliff. Now hardware is impossibly expensive, putting Gen 6 in doubt. Lots of projects shuttered or delayed, and layoffs.
AI and gaming is an important topic, but this story is an oversimplification of what has been hitting the games industry for > 2 years .
AI and gaming is an important topic, but this story is an oversimplification of what has been hitting the games industry for > 2 years .
The point is that stock-market guys thinks that the Google AI models alone is worth a 21% drop in share price between Thursday and Friday for Unity Technologies.
I have no doubt that someday in the future these world models will revolutionize gaming. However, they are clearly very far off from that point in capability, not to mention the cost. And a lot of these articles I'm seeing are confidently stating very incorrect facts like "this new model will completely change the workflow of game developers and accelerate game development." No it won't.
I don't trade individual stocks but it does seem like an easy case of "buy the dip" here.
I don't trade individual stocks but it does seem like an easy case of "buy the dip" here.
The intersection of investors who understand what it takes to build a game engine and also the capabilities and plausible future capabilities of Google’s model is practically zero.
They do not even play games. Probably would invest into Concord/Highguard too.
This is a cool tech demo, not a video game. The fact that video game stocks slid by so much after this release just shows how reactive, speculative and uneducated most investors are.
There is no limit to the ignorance of stock-market investors.
Related HN Discussion on Genie:
https://news.ycombinator.com/item?id=46812933
https://news.ycombinator.com/item?id=46812933
It will be a long way to productionize this.
I would say an impossibly long way.
Unless the idea is to have a new kind of media, distinct from classic games.
I would say an impossibly long way.
Unless the idea is to have a new kind of media, distinct from classic games.
It's important to remember that "games" aren't a monolith. People want different things. There's a categorization I vaguely remember and I was an "explorer". Hated narrative, puzzles and any repetition. Never wanted multiplayer. Just give me a weird world to explore. Yeah, procgen has limits but Minecraft is still fascinating to me.
This is so silly.
Games are a form of communication in arts between the designer and the player.
Ai generated content is at best the ikea flat pack replacement. Utilitarian and you feel nothing.
Anything meaningful and worthwhile spending time on must come from something that carries meaning.
Games are a form of communication in arts between the designer and the player.
Ai generated content is at best the ikea flat pack replacement. Utilitarian and you feel nothing.
Anything meaningful and worthwhile spending time on must come from something that carries meaning.
Meh, irrelevant. This... thing comes from Google, which has two guarantees: it'll be unbearably bland, and will be abandoned in one year tops.
It's not like someone is going to prompt up "gimme GTA7 based on what you know about all the past GTAs" and similar crazy high level instructions in a few weeks and go, "yep, that's our standard". There are almost certainly thousands, if not hundreds of thousands, of little decisions that go into producing something so massive in scope. Anything that could significantly speed up prototyping, world building, character modeling, NPC behavior, etc, should be seen as a massive boon, and probably the shot in the arm the video game industry needs.
And I have the same critique of premium streaming series. Vince Gilligan likes to extoll the benefits of not using AI at all in producing his work, but then he gives us a potentially 3 year span between seasons of his latest entry... where not a lot happened, because it's almost entirely chewing character dev stuff. The idea that a 5-6 season show might take longer to complete than seeing a child born and off to college is absolute bonkers.