Core Insights - Tencent's Q2 2025 earnings report highlighted the unexpected success of the game "Delta Action," which has rapidly climbed to the top of the industry in terms of daily active users (DAU) and revenue [1][4][10] Game Performance - "Delta Action" launched in September last year and has shown significant growth, entering the top five in industry DAU and top three in revenue [1][4] - The game achieved over 10 billion yuan in revenue in Q4 last year and currently boasts over 20 million daily active users, marking a 66% quarter-on-quarter increase [4][10] - It has become a rare dual-platform evergreen product, performing exceptionally well on both PC and mobile [4][10] Strategic Importance - Tencent's management has consistently highlighted "Delta Action" as a key contributor in every earnings report since Q3 last year, positioning it alongside major titles like "Honor of Kings" and "Peace Elite" [2][5] - The game aligns with Tencent's strategy for long-term service-oriented games (GAAS), marking it as the most successful self-developed evergreen product since "Peace Elite" in 2019 [5][20] Market Dynamics - "Delta Action" has reached a peak of nearly 200,000 concurrent users on the Steam platform and ranks among the top three in net bar popularity [6] - On mobile, it competes closely with "Peace Elite," ranking in the top three of both the App Store free and revenue charts [8] - The game has the highest average daily active accounts among new releases in the past three years [9] Revenue Structure - The strong performance of "Delta Action" has shifted Tencent's revenue structure towards self-developed products, directly enhancing the gross margin of Tencent's value-added services, which saw a year-on-year increase of 23% [10] Competitive Landscape - Tencent's management has addressed concerns regarding potential cannibalization among its flagship games, emphasizing that the shooting game genre in China remains underexploited compared to Western markets [15] - The company believes that the introduction of new gameplay modes can expand the user base rather than merely competing for existing users [15] - "Delta Action" and "Peace Elite" currently have low overlap in user demographics, reducing immediate competition [15][18] Future Considerations - Tencent aims for "Delta Action" to complement "Peace Elite," potentially attracting players interested in extraction gameplay [18] - The company holds the IP for "Delta Action," allowing for greater revenue control and operational flexibility compared to "Peace Elite," which is based on an IP controlled by a third party [20] - The competition between Tencent's internal studios could lead to significant shifts in its game development strategy, especially if "Delta Action" continues to outperform "Peace Elite" [20]

Financial Performance - Net revenue for the second quarter reached RMB 27.9 billion, representing a year-on-year growth of 9.4% [1] - Revenue from games and related value-added services was RMB 22.8 billion, up 13.7% year-on-year, with online games accounting for 97.1% of this segment, approximately RMB 22.14 billion [1] Game Releases and Updates - Notable game releases include "Out of Bounds" on Xbox and PS5 in April, "All-Star Streetball Party" globally in May, and "Marvel Secret Wars" launched in June [4] - Existing titles like "Nirvana in Fire," "Seven Days World," and "Identity V" achieved strong market performance through version updates in Q2 [4] Product Pipeline - Upcoming products include a sci-fi shooting mobile game set to launch overseas on August 28, an ocean adventure RPG expected in 2026, and several other games in development [8] - "Nirvana in Fire" mobile and "Yanyun Sixteen Sounds" are set for global release, with the former having opened global pre-registration in May [10] Market Strategy and Performance - The CEO emphasized the commitment to developing "evergreen games" and enhancing player experiences through self-developed IPs [10] - "Yanyun Sixteen Sounds" has shown robust performance, exceeding pre-launch expectations in user engagement and monetization [10] Revenue Dynamics - "Seven Days World" experienced a revenue rebound following a significant update in July, with a balanced user and revenue ratio between domestic and overseas markets [11] - The company is focusing on the competitive landscape of shooting games, aiming to meet high user expectations for quality and innovation [12] Marketing and Expansion - The company employs a standard operational process for marketing, leveraging social media and AI tools, with a balanced approach to marketing expenditures [17] - Future expansion in overseas markets is a priority, with successful entries in regions like North America, Japan, and Southeast Asia [18] Game Performance Insights - "Marvel Secret Wars" saw a temporary rise in sales rankings on Steam, indicating effective seasonal update strategies [13] - "Dream of the Red Chamber" and "Egg Party" have shown data recovery, attributed to innovative content and marketing strategies [15]

Group 1 - NetEase's first major single-player game, "Wanmin Changge: Three Kingdoms," was canceled shortly after its demo release, indicating a cautious approach to project viability based on market demand [4][17] - The success of "Black Myth: Wukong" has revitalized the single-player game market in China, showcasing its potential beyond direct sales revenue and changing perceptions about the quality of domestic single-player games [4][5] - The number of new F2P games in China is declining, with a reported drop of over 22% year-on-year in the first half of 2025, indicating a challenging environment for free-to-play titles [4][12] Group 2 - The single-player game market in China saw significant growth, with sales reaching approximately 10.22 billion yuan in 2024, largely driven by "Black Myth: Wukong," which alone generated around 9 billion yuan [7][9] - Despite the growth in single-player games, they still lag behind top F2P games in revenue, with "Honor of Kings" generating approximately 2.419 billion USD (about 17.359 billion yuan) in 2024 [9][10] - The cost of developing AAA games has become a significant challenge, with budgets often exceeding 100 million USD, leading to a focus on fewer, more secure projects by major publishers [18][20] Group 3 - The cancellation of "Wanmin Changge: Three Kingdoms" highlights the high development costs associated with single-player games, where a team of 70 could incur costs of around 150 million yuan over three years, necessitating substantial sales to break even [17][21] - The industry is witnessing a shift towards mid-tier 2A games and independent titles as viable options for developers, allowing for better cost control while still delivering creative content [21] - The current landscape suggests that the single-player game market may be entering a favorable era, where both creative aspirations and financial viability can coexist [21]

Core Insights - The article highlights the impressive DAU achievement of "Metro Escape" mode in "Peace Elite," surpassing 37 million on May 1, indicating a strong market presence and potential for growth in the shooting game sector [1][3][4] - "Metro Escape" has established itself as a leading product in the new "search, fight, and retreat" genre, demonstrating the ability of established titles to adapt and thrive in changing market conditions [4][5][12] - The success of "Metro Escape" reflects a strategic shift towards more engaging gameplay experiences, appealing to both new and existing players, and signifies a potential new standard in the gaming industry [8][19][30] Summary by Sections DAU Performance and Market Position - "Metro Escape" achieved a DAU of over 37 million, leading the "search, fight, and retreat" genre and significantly outpacing other new titles [1][4] - The mode's success indicates a robust growth trajectory for established games that can pivot to new trends effectively [5][12] Gameplay Innovation - The "search, fight, and retreat" gameplay model enhances player experience by integrating strategy, character development, and resource management, making it appealing to younger audiences [8][9] - The mode's design focuses on accessibility and enjoyment, reducing barriers for new players while providing diverse gameplay options [24][27] Strategic Development and Market Trends - The article discusses how "Peace Elite" has leveraged its large user base to identify and capitalize on emerging gameplay trends, leading to sustained growth [11][12][15] - The introduction of "Metro Escape" in 2024 reflects a calculated response to market demands, showcasing the ability of established titles to innovate and adapt [12][19] Economic Impact and Community Engagement - The success of "Metro Escape" has driven significant engagement on social media platforms, with over 36.9 billion views on Douyin, indicating a thriving community around the game [33][35] - The mode has contributed to a resurgence in content creation related to "Peace Elite," enhancing its ecosystem and attracting new creators [35][36] Long-term Viability and Growth Strategy - The article emphasizes the importance of maintaining a dynamic product lifecycle, with "Metro Escape" exemplifying how established games can evolve to meet changing player expectations [17][19] - The success of "Metro Escape" is expected to have long-term positive effects on "Peace Elite," reinforcing its position in the competitive gaming landscape [36][39]

Core Insights - The global mobile game market is shifting from "traffic-driven" to "deep cultivation" of existing products, with Century Huatong's game "Whiteout Survival" demonstrating the logic of evergreen products through sustained operations [1][3] - "Whiteout Survival" ranks in the top three for new mobile game revenue in 2024, showcasing strong growth momentum [1][3] - The report indicates that RPG games dominate the market, with a 33.7% share, highlighting the importance of long-term operational capabilities in sustaining player engagement [5][7] Company Performance - Century Huatong's subsidiary, DianDian Interactive, has significantly improved its self-development capabilities, leading to high-frequency updates and new content for "Whiteout Survival" [3] - The introduction of AI tools has optimized production efficiency, allowing for rapid content generation and refinement, which enhances user experience [3] - Century Huatong's subsidiary, Shengqu Games, has successfully leveraged classic IPs, with "MapleStory" celebrating its 20th anniversary and "Final Fantasy XIV" maintaining strong user interest [4] Market Trends - The 2024 report shows that mid-core games, particularly RPGs and strategy games, occupy a significant portion of the top 1000 new games, indicating their mainstream status in the market [5] - The success of long-standing IPs like "Legend of Blood" and "Dragon Valley" demonstrates the effectiveness of continuous updates and deep operations in meeting player demands [5][6] - Looking ahead, Century Huatong aims to further explore the potential of classic IPs to create more sustainable and high-quality games, contributing to a healthier industry [7]

Investment Rating - The industry rating is "Recommended" [5] Core Views & Investment Suggestions - Significant progress has been made in China-US tariff negotiations, leading to cautious optimism. The US will suspend 24% tariffs on Chinese goods for 90 days while retaining 10%, and China will reciprocate. This agreement signals a phase of easing tensions and may alleviate export chain pressures [2][22] - Three major food delivery platforms, including JD, Meituan, and Ele.me, have been summoned for discussions regarding fair competition practices. This regulatory action is expected to enhance service quality and industry standards [2][27] Market Overview - In the week of May 12-16, 2025, the Shanghai Composite Index rose by 0.76%, while the SW Media Index fell by 0.77%, ranking 29th among 31 industries [1][11] - The top-performing sub-industries included Internet services, broadcasting, and sports, with respective increases of 1.86%, 0.37%, and 0.1% [1][11] Investment Opportunities - The report suggests focusing on the following investment opportunities: 1. Hong Kong Internet leaders, which are expected to benefit from consumption promotion and employment stabilization 2. The gaming industry, which is likely to see growth due to policy incentives and technological advancements 3. The film and cultural tourism sectors, which may recover due to consumer policies stimulating demand [3][23] Industry Data - The top three films by box office revenue for the week were "Dumpling Queen" (31.914 million yuan), "Hunting Gold: Game" (27.856 million yuan), and "Life Opens the Door" (12.039 million yuan) [50][51] - The iOS game sales rankings were led by "Honor of Kings," "Peacekeeper Elite," and "Golden Shovel," while the Android rankings were topped by "Heartfelt Town," "My Leisure Time," and "Honkai: Star Rail" [52][53] - The top three TV dramas based on viewership index were "Bending the Waist," "Huai Shui Bamboo Pavilion," and "A Good Life" [56]

Investment Rating - Industry Rating: Recommended [5] Core Views & Investment Suggestions - Significant progress in China-US tariff negotiations, maintaining cautious optimism. The US will suspend 24% tariffs on Chinese goods for 90 days while retaining 10%, and China will reciprocate. This agreement signals a phase of easing tensions and may alleviate export chain pressures [2][24] - Three major food delivery platforms, including JD, Meituan, and Ele.me, were summoned for discussions to enforce fair competition and protect rider rights. This regulatory push is expected to enhance service quality and industry standards [2][30] Market Overview - In the week of May 12-16, 2025, the Shanghai Composite Index rose by 0.76%, the CSI 300 Index increased by 1.12%, and the ChiNext Index grew by 1.38%. The Hang Seng Index saw a 2.09% rise, while the SW Media Index fell by 0.77%, ranking 29th among 31 industries [1][12] Investment Opportunities - Focus on leading technology companies in China, particularly in the context of increasing domestic demand and technological innovation. Suggested sectors include: 1. Hong Kong internet leaders benefiting from consumption and employment stabilization 2. Gaming industry, with policy incentives boosting domestic demand and overseas expansion potential 3. Film and cultural tourism sectors, with consumption policies aiding cinema recovery [3][25] Industry Data - Top three films by box office for the week include "Dumpling Queen" with 31.914 million yuan, "Hunting Gold: Game" with 27.856 million yuan, and "Life Opens the Door" with 12.039 million yuan [4][57] - iOS game sales rankings are led by "Honor of Kings," "Peace Elite," and "Golden Shovel," while Android rankings feature "Heart Town," "My Leisure Time," and "Honkai: Star Rail" [4][61] - The top three TV dramas by broadcast index are "Bending the Waist," "Huai Shui Bamboo Pavilion," and "A Good Life" [4][64]

Core Viewpoint - NetEase's Q1 2025 performance showed significant growth, driven by both new and existing games, with a net revenue of 28.8 billion yuan, a year-on-year increase of 7.4% [1][11] Revenue Growth - In Q1 2025, NetEase's net revenue from online games and related value-added services reached 24 billion yuan, up from 21.2 billion yuan in the previous quarter and 21.5 billion yuan in the same quarter last year [2] - Online games accounted for approximately 97.5% of the net revenue in this segment, an increase from 96.7% in the previous quarter and 95.2% year-on-year [2] Game Performance - The newly launched games, including "Marvel Showdown" and "Yanyun Sixteen Sounds," contributed to revenue growth, with "Marvel Showdown" achieving record highs on Steam after its second season update [2][3] - "Yanyun Sixteen Sounds" surpassed 30 million registered players by March 2025, filling a gap in the market for martial arts-themed games [5][10] Game Strategy - The company plans to adjust the update cycle for "Marvel Showdown" from three months to two months, aiming to enhance player engagement and stabilize game metrics [5] - The monetization strategy for "Yanyun" focuses on a tiered, low-pressure payment model, allowing players to enjoy the game without heavy financial commitment [6] Long-term Game Development - The success of "Identity V," which has been optimized over six years, demonstrates the potential for long-term game sustainability, with a significant revenue increase of 123% in January 2025 [7][8] - The company emphasizes the importance of continuous content updates and player loyalty for the longevity of its games, particularly for "Yanyun" [9][10] Market Response - Following the positive financial results, NetEase's stock price rose by 13.03% to 190 HKD on May 16, 2025, reflecting investor confidence [11]

Core Insights - Tencent, Point Interactive, NetEase, Mihayou, and Lemon Microfun continue to dominate the top five positions in the mobile game revenue rankings [3][4][5] - The competition in the lower rankings (Top 20-30) is intense, with several companies like Mattel163, Youku Shengshi, Thunder Network, and Competitive World returning to the Top 30 due to effective operational strategies [3][4] - The total revenue from Chinese mobile game publishers in the global Top 100 reached $2 billion, accounting for 38.4% of the total revenue of the Top 100 [3] Tencent - Tencent maintains a strong presence with nine titles in the Top 20, including the newly added "Delta Action" and "NBA All-Star" [4][5] - "Honor of Kings" saw a significant revenue increase due to a major update and various promotional activities, leading to a 71% global revenue growth [9][11] - "Delta Action" experienced a 115% revenue surge in April, reaching the 11th position in the revenue rankings [11][12] - "Naruto: Ninja" also achieved a revenue increase of 91% in April, breaking its daily revenue record since launch [18][20] Point Interactive - Point Interactive's main revenue driver remains "Whiteout Survival," which continues to perform well in multiple regions [22] - The new SLG game "Kingshot" launched in late February has shown promising growth, with a 209% revenue increase in April, contributing to a 5% overall revenue boost for the company [26][30] Mihayou - Mihayou's "Honkai: Star Rail" celebrated its second anniversary with a significant revenue increase of 51% in April, driven by new character releases and promotional events [32][34] - Other titles like "Genshin Impact" and "Honkai: Zero" also saw revenue growth due to updates and new character introductions [38][40] Yuxing Network - Yuxing Network's titles, including "Mahjong Soul," "Blue Archive," and "Arknights," performed exceptionally well in Japan, with revenue increases of 110%, 458%, and 69% respectively, leading to a 91% overall revenue growth [42][46] 4399 and Thunder Network - 4399's revenue increased by 24% due to new games like "Endless Journey: Scroll World" and "Raising Godkkaebi," which have gained popularity [48][50] - Thunder Network returned to the Top 30 rankings, attributed to the success of "Wandering Sword," which has shown strong performance since its launch [54][57]

3 月底，腾讯入股育碧子公司的交易正式敲定。根据公告，这家子公司将拥有《刺客信条》《孤岛惊 魂》和《彩虹六号》的开发团队、历史作品以及所有未来的新作品。 育碧通过向该子公司授予全球 独家永久 IP 授权许可，来换取版权费。 华尔街日报指出，1986 年，吉尔莫特家族（Guillemot）五兄弟创立了育碧，至今仍然掌握着公司的 控制权。他们不仅在十年前成功抵御了法国传媒集团威望迪（Vivendi）的收购企图，即便在 2022 年微软收购动视暴雪、Take-Two 和索尼频频出手的行业并购潮中，育碧依然保持独立。当时其 CEO 表示，健康的资产负债表和游戏组合是他们能够保持独立的关键。然而，最近两年，情况发生了变 化。彭博社分析认为，育碧一直在努力摆脱疫情造成的开发困境，不得不取消部分项目，延期发布新 游戏，加上已推出的产品未获得玩家认可，去年损失了超过一半的市值。 ▲ 刺客信条游戏画面 | 图源：育碧 那么，育碧近年来究竟遇到了哪些挑战呢？ 根据彭博社 2019 年的报道，育碧平均每年推出约 5-6 款 3A 大作，而其竞争对手，即同样主营高成 本单机游戏的厂商如 EA 和 Take-Two 等，已将每年上架的 ...