• Jefferies analyst Brent Thill raised his price target on Unity stock to $35.

• Ad spending in mobile games is on the rise, and Unity should benefit from this.

• Genies partners with Unity to bring AI avatars and UGC tools to developers

Unity Software, a 3D graphics software specialist, rocketed 14% on Wednesday.

Jefferies analyst Brent Thill raised his price target on Unity by more than 20% to $35 and reiterated his buy recommendation on the stock.

Citing data from his company's 2Q mobile game ad tech survey, Thill said "overall 2025 ad spend expectations improved off of April" and are now on course for nearly 4% year-over-year growth. Unity's share of this market is growing and "incrementally positive," leading the analyst to raise his earnings estimates for the stock -- and accordingly, his price target.

Morgan Stanley analyst Matthew Cost maintained a Buy rating on Unity Software and set a price target of $25.00. The company’s shares closed yesterday at $33.94.

Genies Partners With Unity to Bring AI Avatars and UGC Tools to Developers

Genies, an AI avatar and gaming technology company, has partnered with Unity (NYSE: U), the leading platform to create and grow games and interactive experiences, to provide game developers access to highly customizable AI avatar and asset creation tools. The partnership will also bring game, entertainment, celebrity, and sports IP into the Unity Asset Store, where developers can gain access to IP-driven avatars and assets to create games via Genies’ partnerships.

With the Genies’ Smart Avatar Framework and User-Generated-Content (UGC) systems coming to the Unity Asset Store and Unity Editor, developers can cut down the time needed to create game-ready avatars and assets. By leveraging Genies’ tools and frameworks, developers can seamlessly integrate these assets into games, allowing them to focus more on crafting core game design and gameplay. The technology also opens up new genres of gameplay with intelligent avatars and UGC tools. Upon launch in 2026, these tools will empower developers to create high-quality, game-ready assets and new types of AI games.