Unity Software (U) continues to look positive heading into Q3 results, as its Vector advertising platform gains traction in the industry, Wedbush said in a Wednesday note.

Unity is slated to report Q3 financial results before the market opens on Nov 5.

Vector has moved up from being a test channel for user-acquisition teams into a fully budgeted channel, according to the note.

Wedbush analysts said that an industry expert told them that his firm boosted its budget spending to about 20% from 5% from a year ago. Runtime data has not yet shown up in advertiser results, reinforcing the analysts' view that its bigger contribution will be in Q4 and in 2027.

Meanwhile, an ad-tech advisor consulted by the analysts has ranked Unity as the second among gaming demand-side platforms, behind only AppLovin (APP) and surpassing Liftoff (LFTO).

Wedbush projects Q3 non-GAAP EPS of $0.37 on revenue of $567 million for Unity, compared with FactSet consensus estimates of $0.35 and $566.6 million, respectively.

Wedbush reiterated the company's stock rating at outperform and raised the price target to $55 per share from $50.

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