Group 1 - NetEase's self-developed RPG "Forgotten Sea" has launched a new round of testing recruitment, showcasing the company's commitment to the open-world gaming segment [1] - The game allows players to assume the role of a puppet captain embarking on a maritime adventure, indicating a focus on innovative gameplay [1] - If the product quality is high, it is expected to enrich the company's product matrix and provide a new growth point for performance [1] Group 2 - The mobile game "Goose Goose Duck" has seen over 5 million new users within 24 hours of its public launch, demonstrating its market popularity and user acquisition capabilities [2] - The official announcement discouraging ID trading and account buying highlights the importance of compliance in game operations, which supports the long-term healthy development and brand reputation of the company [2] - This situation reflects the challenges faced by social games in their early commercialization stages, serving as a warning for the gaming sector that emphasizes compliance and risk management [2] Group 3 - FunPlus's game "Imo" is set to hold a preview live stream for its second testing phase, indicating ongoing engagement with its audience [3] - The game has achieved over 1.17 million reservations on the TapTap platform, showcasing strong market interest in the pet-catching gameplay [3] - The addition of new features such as RV camping and competitive modes enriches the game's content ecosystem, validating the positive impact of innovative gameplay on user attraction [3]

Company Updates - The game "Heart Town" achieved top rankings in multiple regions/countries on the iOS free game chart shortly after its overseas pre-download on January 7, with the official launch occurring on January 8 [1] - The game supports cross-platform play on Android, iOS, and PC, with user account synchronization [1] - Initial download performance exceeded expectations, with a focus on user retention and localized operational activities [1] - Since testing began in November 2025, the game has seen a significant increase in pre-registrations, surpassing one million before its launch [1] - As of January 8, the game ranked first in the iOS download charts across 16 countries/regions, including Japan, South Korea, the United States, and Singapore [1] Strategic Insights - The international version of "Heart Town" is a validation of the company's "evergreen games + globalization" strategy, highlighting its ability to rejuvenate IP and the long lifecycle value of high DAU categories [2] - Other growth points for the company in 2026 include: 1. "Torchlight," with expected revenue growth in the second half of 2025 and continued momentum into 2026 following the completion of IP acquisition [2] 2. TapTap platform, anticipated to achieve double-digit year-on-year growth in advertising revenue due to a rich supply in the gaming industry [2] 3. Continued expansion of ADN business [2] Shareholder Returns - The company announced a share buyback plan of HKD 400 million, set to expire on June 4, 2026, reflecting confidence in long-term growth and benefiting shareholder equity [2] Profit Forecast and Valuation - The company maintains its net profit forecasts for 2025-2027 at RMB 1.43 billion, 1.69 billion, and 1.96 billion respectively [2] - Current price corresponds to 18x and 15x P/E for 2026 and 2027, respectively, with a target price of HKD 89.5, indicating a potential upside of 28% [2]

Core Insights - The Chinese gaming industry experienced significant growth in 2025, with total market sales exceeding 350 billion yuan and user numbers surpassing 680 million, both reaching historical highs [1] - The year 2025 marked a shift towards recognizing new possibilities within the industry, moving away from overcrowded segments and allowing for the emergence of niche products [2] Industry Trends - The gaming sector saw a reduction in "copycat" behavior, leading to the rise of many previously overlooked genres, with notable successes such as "Search and Retreat" games [2] - The mini-game market generated revenues of 53.535 billion yuan in 2025, reflecting a substantial year-on-year growth of 34.39%, indicating a broadening demographic of gamers, including older adults [3] Company Performance - Key financial metrics for the company include a revenue of 4.075 billion yuan and a net profit of 1.583 billion yuan for the first three quarters of 2025, representing a year-on-year increase of 23.70% and a stable gross margin above 83% [2] - The company has adopted a strategic focus on its core gaming business, emphasizing the importance of IP in ensuring product success and reducing costs in both development and marketing [4][5] Strategic Initiatives - The company has expanded its business model to include a user platform, highlighted by the launch of the "996 Legend Box," which caters to a dedicated community of fans and has achieved nearly 500,000 daily active users [5] - In 2026, the company plans to enhance its four business systems—development, publishing, investment + IP, and user platform—aiming for better synergy among these areas [6]

Group 1 - The gaming sector remains strong, with the gaming ETF (159869) rising approximately 1.2% as of January 8, driven by stocks such as Guomai Culture, Borui Communication, Perfect World, and others showing significant gains [1] - As of January 7, the ETF's scale reached 13.707 billion, providing investors with a convenient tool to invest in leading A-share gaming companies [1] - First Capital Securities anticipates that with the normalization of game approvals and industry recovery, gaming companies are increasing investment in new product development, expecting a concentrated launch period in 2026 [1] Group 2 - The gaming sector is catalyzed by multiple factors including AI, content, and commercialization model transformations, with the gaming ETF (159869) tracking the performance of A-share listed companies in the animation and gaming industry [2]

Group 1 - The gaming sector saw a slight reduction in midday gains, with the gaming ETF (159869) rising nearly 1% as of January 8, 2025, and its scale reaching 13.707 billion yuan by January 7, 2025, providing a convenient tool for investors to position in A-share gaming leaders [1][2] - Sensor Tower's report on January 7, 2025, highlighted that the mobile game "Endless Winter" by Dd Interactive topped the overseas revenue chart, with global cumulative revenue exceeding 4 billion USD, driven by a Christmas-themed event launched in late December [1][2] - Activision Blizzard and Tencent's TiMi Studio Group's "Call of Duty Mobile" achieved a 36% increase in overseas revenue, ranking fifth in the revenue chart and leading the growth in overseas mobile game revenue during the same period [1][2] Group 2 - The success of "Endless Winter" and "Call of Duty Mobile" underscores the exceptional capabilities of Chinese developers in long-term operations and content updates, indicating that holiday marketing and IP collaboration can effectively enhance user value, thus supporting the valuation of leading gaming companies with global distribution networks [2] - The overall performance of domestic mobile games in the global market continues to lead, boosting market confidence in the overseas prospects of the gaming industry and cultural exports [2] - The gaming sector is catalyzed by multiple factors including AI, content, and commercialization model transformations, with the gaming ETF (159869) tracking the CSI Animation and Gaming Index, reflecting the overall performance of A-share listed companies in the animation and gaming industry [2]

Group 1 - The mobile game "Goose Duck" officially launched its full platform public beta on January 7, generating significant buzz on social media, with discussions reaching 1.247 million and a reading volume of 1.78 billion on Weibo [2] - The game achieved over 20 million pre-registrations before the public beta, topping various app store pre-registration charts, and maintained a stable rating of 9.6 on TapTap [2] - The game received 732 positive reviews on Steam, with players expressing nostalgia and enjoyment of the gameplay [2] Group 2 - The development team at Kingsoft Game has made optimizations based on player feedback from previous tests, addressing issues such as server connectivity and gameplay experience [3] - New gameplay modes and characters have been introduced, including "Super Golden Water Bell" and "8-Person Knife Fight," along with new roles exclusive to the Chinese server [3][4] - Original costumes, emojis, and personalized actions have been added to enhance player customization and experience [4] Group 3 - Kingsoft Software, the parent company, has shifted its strategy from short-term game releases to long-term IP operation since 2022 [5] - Despite the success of "Goose Duck," Kingsoft Software reported a decline in revenue and net profit for the first three quarters of 2025, with total revenue of 7.065 billion yuan, down 8.34% year-on-year [5] - The CEO attributed the revenue drop to reduced contributions from existing games and the early-stage development of new titles [5] Group 4 - Industry analysts suggest that Kingsoft Game serves as an effective testing platform for new games, with the potential for "Goose Duck" to fill a gap in party game experiences [6] - Continuous innovation in gameplay and content is essential for maintaining player interest and avoiding a peak immediately after launch [6]

Core Viewpoint - The gaming sector in the A-share market has seen a significant rise, with an overall increase of over 60% in 2025, driven by favorable policies and market conditions [1] Group 1: Market Recovery and Growth - The number of approved domestic online games reached a historical high of 1,771 in 2025, a 25.07% increase from 1,416 in 2024 [2] - The recovery in game approvals is attributed to a combination of factors, including improved policies and social attitudes towards the gaming industry [4][5] - In April 2025, the government introduced three measures to support the gaming industry, including tax incentives and support for IPOs and mergers [6] - The approval process for game licenses has been optimized, reducing the time to under a year, with some approvals taking as little as three months [8] - Negative impacts from past regulations, such as restrictions on minors and license suspensions, are gradually dissipating [9] Group 2: Industry Investment and Revenue - Leading gaming companies have significantly increased their R&D expenditures, with Century Huatong, Giant Network, and G-bits spending 760 million, 340 million, and 280 million yuan respectively, all showing over 45% growth year-on-year [11] - The actual sales revenue of the domestic gaming market reached 350.79 billion yuan in 2025, reflecting a year-on-year growth of 7.68% [13] - The user base grew by 1.35% to 683 million, marking a historical peak [16] - The gaming industry is experiencing a surge in user engagement and spending, with the overall revenue growth for the industry’s stocks showing increases of 22%, 22%, and 29% in the first three quarters of the year [23] Group 3: Evolving Game Genres and Trends - The gaming industry is witnessing a rapid evolution in game genres, with a notable rise in party games and FPS titles since 2022 [30][32] - The success of games like "Genshin Impact" has set a precedent for future game releases, indicating a trend towards innovative and hybrid game types [35] - WeChat mini-games have emerged as a significant growth area, with market revenue reaching 53.54 billion yuan in 2025, a 34.39% increase [39] - The monthly active users of WeChat mini-games reached 500 million, with daily online time increasing by 10% [40] Group 4: Future Outlook and Competitive Landscape - The gaming market is expected to continue expanding, driven by the rise of high-quality mobile games and the integration of AI in game development and operations [46][47] - Despite the positive outlook, competition within the gaming industry is intensifying, prompting companies to pursue mergers and global market expansion [50][51] - The most promising companies are those that can innovate gameplay and develop platform-based gaming experiences, which may lead to growth and valuation increases [55] - The darkest times for the gaming industry appear to be over, signaling a potential turning point for sustained growth [56]

Group 1 - The core viewpoint is that brain-computer interfaces (BCIs) are entering a stage of mass production, with gaming as a significant application area expected to benefit continuously [1][2] - BCIs can enable individuals with motor disabilities to experience gaming through "brain-controlled" interfaces and assist in rehabilitation for neurological conditions [1][2] - The recent launch of China's first fully implanted, wireless BCI product by Shanghai Brain Tiger Technology marks a critical breakthrough in core BCI technology, positioning China among the top international players [2] Group 2 - Game companies are actively investing in the BCI field, with 37 Interactive Entertainment investing in Strong Brain Technology, the first unicorn in China's BCI sector, and developing a game for autism assistance that integrates BCI technology [2] - Century Huatong has established a research center with Zhejiang University focusing on brain-computer integration and other emerging fields [2] - Tom Cat plans to collaborate with various research institutions in 2024 to advance BCI, brain function data analysis, and digital game therapy [2] Group 3 - AI is significantly empowering the gaming industry, enhancing multi-modal capabilities and innovative integration forms, which may open new industry spaces [3] - The integration of AI in gaming has led to a 40% reduction in character animation production cycles and a significant decrease in prototype validation time [3] - The exploration of AI and gaming integration is expected to provide players with novel experiences and further expand industry development opportunities [3] Group 4 - The upcoming gaming season is anticipated to drive revenue growth through the launch of new games and updates to existing titles [4] - Notable upcoming events include anniversary celebrations and collaborations with popular IPs, which are expected to attract player engagement [4] - Investment opportunities in the gaming sector are highlighted, with a focus on companies like Giant Network, Xindong Company, and others benefiting from the seasonal demand [4]

Core Insights - The return of the game "Goose Duck" in China has generated significant social media buzz, with over 20 million pre-registrations and billions of views on related topics, indicating its potential as a new "social currency" for Generation Z [1][2][4] Group 1: Game Performance and Market Impact - "Goose Duck" has achieved a remarkable presence on social media, with its pre-registration surpassing 20 million and related topics trending on platforms like Weibo, accumulating hundreds of millions of views [2][3] - The game has strong social attributes, with nearly 80% of its players aged 18-25, highlighting its appeal among younger audiences [4] - Despite initial excitement, there have been complaints regarding server issues and user experience, indicating potential operational challenges [3][4] Group 2: Financial Performance of Kingsoft - Kingsoft's financial performance has been under pressure, with revenue and net profit declining in the first three quarters of 2025, showing a revenue drop of 8.34% to 7.065 billion yuan and a net profit decrease of 5.68% to 1.029 billion yuan [7][8] - The gaming segment has faced significant challenges, with revenue from network games dropping by 26.1% to 2.886 billion yuan, and a nearly 50% decline in the third quarter alone [7][8] - Increased marketing expenses, which rose by 55% year-on-year to 564 million yuan, have not translated into revenue growth, leading to a substantial decline in gaming income [7][8] Group 3: Strategic Challenges and Future Outlook - Kingsoft is transitioning from a short-term hit-driven model to a long-term IP-focused strategy, aiming to integrate games into users' daily lives [6][8] - The company faces a cycle of declining revenue from existing games while new titles have not met market expectations, raising concerns about future growth [8][9] - The CEO has acknowledged that the decline in revenue is primarily due to the aging of flagship games and the underperformance of new releases, alongside increased investments in AI and game development [8][9]

Core Viewpoint - The return of the game "Goose Duck" in China has generated significant social media buzz, with over 20 million pre-registrations and billions of views on related topics, positioning it as a new "social currency" for Generation Z. However, the parent company, Kingsoft, is facing performance anxiety as its revenue and net profit have declined significantly, particularly in the gaming sector, which has seen a nearly 50% year-on-year drop in the third quarter [1][2][3][4]. Group 1: Game Popularity and Social Impact - "Goose Duck" has achieved a remarkable pre-launch presence, with over 20 million pre-registrations and significant engagement on social media platforms, especially Weibo [5][6]. - The game has become a cultural phenomenon, with players and streamers expressing excitement and sharing personal stories, indicating its strong social attributes [9][10]. - The game targets a young audience, with nearly 80% of its players aged 18-25, highlighting its appeal among Generation Z [10]. Group 2: Company Performance and Challenges - Kingsoft's financial performance has deteriorated, with total revenue of 7.065 billion yuan, a year-on-year decrease of 8.34%, and net profit of 1.029 billion yuan, down 5.68% [17]. - The gaming segment has been particularly hard hit, with revenues dropping by 26.1% to 2.886 billion yuan, and a significant decline of 47% in the third quarter alone [17][18]. - Increased marketing expenses, which rose by 55% year-on-year, have not translated into revenue growth, leading to a substantial impact on overall company performance [17][18]. Group 3: Strategic Direction and Future Outlook - Kingsoft is shifting from a short-term focus on hit games to a long-term strategy centered on IP development, aiming to integrate games into users' daily lives [13][14][16]. - The company faces a challenging cycle of declining revenues from existing games while new titles have not met market expectations, raising concerns about future growth [18][19]. - The CEO has acknowledged that the decline in revenue is due to reduced contributions from existing games and the need for new titles to establish market presence, while also investing heavily in AI and new game development [18][19].