Unity shares rise 15% after company announces A.I. marketplace

John Riccitiello (CEO of Unity Technologies) speaks at the TechCrunch 2018 summit in San Francisco on September 5, 2018.

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Unity shares rose by over 15% on Tuesday to $42.38 after the gaming software maker announced that it would be launching a marketplace of artificial intelligence software, positioning itself as a platform for the fastest-growing part of the tech industry.

Unity's clients, who use its software for game engines to create games for smartphones, consoles, and virtual reality headsets will have the option to select software from independent companies, such as Inworld AI and Polyhive, that can generate game dialogue, textures, and graphics, using AI.

Unity's Asset Store will allow AI companies to charge game developers for their software and distribute it to them.

In recent weeks, company officials have spoken about AI's potential.

"AI will have a profound impact on gaming," I believe. In an interview with the Associated Press published on Monday, Unity CEO John Riccitiello stated that AI would make game development faster, cheaper, and better. "It is already happening."

In a separate note, Wells Fargo's Brian Fitzgerald gave the company an overweight rating with a price target of $48.

Fitzgerald and his team suggested that investors might see the current Unity share price as an opportunity to buy, and that it could expand Unity's business beyond gaming with "digital-twins" and simulation products for businesses.

Fitzgerald wrote: "We believe that Unity has a strong position in the market, despite the fact that we recognize the interactive entertainment industry's consolidation could, in the long run, lead to the use of proprietary tools/assets for game development by large studios."

Also, the note said that "metaverse", hype had died down and created a great buying opportunity.

Unity was linked to headsets like Meta because its software could be used to develop virtual reality applications.

Apple announced earlier this month that Unity-based VR apps would be compatible with the Vision Pro headset, which is expected to launch early next year.

Riccitiello does not like the word metaverse. Apple never uses it. In an interview with the AP, he stated that he thought the term was "loaded and stupid".