Core Viewpoint - The A-share gaming sector has shown significant strength since April 2023, with the China Animation and Gaming Index rising over 30% from its low point in early April, indicating positive changes in the industry [3][6]. Policy Support and Market Dynamics - The gaming industry has received continuous policy support, with the National Press and Publication Administration issuing 158 game copyright numbers in June 2025, marking a new high since the regulatory pause in 2021 and 2022 [7][9]. - In the first half of 2025, a total of 812 new games were approved, with 757 being domestic games, reflecting a more than 20% increase compared to the same period in 2024, signaling a shift towards high-quality development in the gaming sector [9][10]. - Various provinces and cities have issued policies to support the high-quality development of the gaming and esports industries, with Beijing's recent measures focusing on optimizing reviews and promoting quality content [10]. Leading Companies and Market Performance - The top ten stocks in the Animation and Gaming Index account for 73.41% of the index's weight, with the top five stocks representing 49.05%, indicating that leading companies are likely to benefit more from the ongoing industry reforms [11]. - Notable companies such as Kayi Network, Giant Network, and Sanqi Interactive have seen significant stock price increases since early April, with gains of 30.28%, 106.46%, and 40.53% respectively [14][13]. AI Integration in Gaming - The integration of AI in gaming is reshaping the industry, with companies like Giant Network pioneering AI-driven gameplay, enhancing user experience and product innovation [15][18]. - Sanqi Interactive has developed an AI model named "Xiao Qi," which enhances various operational aspects, including game development and marketing, significantly improving efficiency [19][21]. International Expansion and Cultural Export - The gaming industry is focusing on international expansion, with China's game exports reaching $18.557 billion in 2024, a 13.39% increase year-on-year, marking a new high [25][26]. - Major companies are actively pursuing global markets, with Sanqi Interactive's upcoming titles targeting international audiences, reflecting a strong commitment to globalization [27][29]. Industry Outlook - The combination of supportive policies, AI advancements, and cultural exports positions the domestic gaming industry for a transformative period, potentially leading to a "DeepSeek" moment in the sector [30][31].

Core Viewpoint - The article discusses the decline of the "second dimension emperor," specifically the game "Million Arthur," which was once a pioneer in the mobile game market but has struggled to maintain relevance in the face of competition and internal challenges [1][2][3]. Group 1: Historical Context and Initial Success - "Million Arthur" was initially successful, generating 300 million in revenue within two weeks of its launch, significantly impacting the domestic gaming market and stock prices [2][3]. - The game experienced rapid decline, with the Japanese version shutting down a year after the Chinese version launched, which eventually also ceased operations in 2016 [3][5]. Group 2: Series of Releases and Decline - The IP saw the release of three additional titles, but none managed to sustain the same level of success, with the latest iterations failing to last even a year [5][7]. - By 2020, the IP was considered to have run its course, with all titles under the "Million Arthur" brand having been discontinued [5][8]. Group 3: Recent Developments and Challenges - A new title, "Million Arthur: Ring," was announced and received a license for the Chinese market, generating initial excitement among fans [8][10]. - However, the game faced significant challenges, including a lack of content updates and a rapid decline in player engagement, leading to its announcement of shutdown in August 2025 [10][11]. Group 4: Internal Issues and Future Uncertainty - The game's poor performance may be linked to recent anti-corruption measures taken by Perfect World, which affected the development team responsible for "Million Arthur: Ring" [13][15]. - The future of the IP remains uncertain, with indications that it may be deprioritized as the company focuses on more successful projects [16].

Core Insights - Chengdu is emerging as a hub for the gaming industry in China, particularly for single-player games, with a significant number of game studios and talent relocating to the city [1][3][4] - The success of the game "Black Myth: Wukong" has highlighted Chengdu's potential, with one-third of the most notable domestic single-player games being developed there [3][4] - Chengdu's gaming industry has a strong foundation due to early investments in talent and infrastructure, dating back to 2003 when the city began promoting the gaming sector [4][5] Industry Overview - Chengdu ranks first in job postings for the gaming industry among top cities in China, according to a report by Zhilian Recruitment [1] - The city has produced a notable number of acclaimed games, with 9 out of 30 highlighted titles in a recent media review originating from Chengdu, surpassing other major cities like Guangzhou and Beijing [3] - The gaming industry in Chengdu benefits from lower living costs and salaries compared to first-tier cities, making it an attractive location for game development [6][7] Cultural and Economic Factors - Chengdu's cultural environment and lifestyle contribute positively to game development, fostering creativity and work-life balance [6][8] - The city has been recognized for its livability, being named one of the "most happy cities" for 16 consecutive years, which enhances its appeal to young professionals in the gaming sector [7][8] - The local gaming industry is characterized by a mix of traditional and innovative themes, with studios exploring both Chinese cultural elements and international narratives [3][6]

Core Viewpoint - Steam is a dominant player in the $400 billion gaming market, achieving significant user engagement and profitability despite its opaque financial reporting [3][6][9]. Group 1: User Engagement and Financial Performance - As of mid-2025, Steam reached a peak of nearly 41.2 million concurrent users, with around 13.2 million players online in games, marking a historical high [2]. - Valve has maintained an operating profit margin exceeding 40% over the past decade, with employee productivity surpassing that of some of the highest market-cap companies like Amazon and Alphabet [6][9]. - In 2021, Valve had only 336 employees, with just 79 dedicated to Steam, yet it contributed to 70% of total PC game sales, indicating a highly efficient operational model [9][10]. Group 2: Business Model and Organizational Structure - Valve's business model emphasizes user-generated content (UGC) through its Creative Workshop, allowing developers to open-source their projects for community modification, enhancing user engagement [15][19]. - The company operates with a unique organizational structure where employees have significant decision-making power, promoting productivity and creativity [21][27][40]. - Valve's decision to remain private allows it to avoid external pressures from shareholders, enabling a focus on content quality and user needs [31][34][40]. Group 3: Leadership and Future Directions - Gabe Newell, co-founder of Valve, has shifted focus towards personal interests and new ventures, including Starfish Neuroscience and Inkfish, while maintaining a low public profile [44][46][48]. - The company's future direction remains uncertain, with speculation about its next steps in the gaming industry as Newell's involvement appears to be lessening [48].

Market Overview - On July 8, the A-share market experienced a rise, with the ChiNext Index leading the gains. The Shanghai Composite Index closed at 3497.48, up by 0.7%, while the Shenzhen Component Index rose by 1.46% to 10588.39, and the ChiNext Index increased by 2.39% to 2181.08. The total trading volume in the Shanghai and Shenzhen markets reached 1.45 trillion yuan, an increase of 245.3 billion yuan compared to the previous trading day [1][2]. Sector Performance - The market showed a mixed performance with over 4200 stocks rising. Key sectors that performed well included computing hardware, photovoltaic concepts, PCB, CPO, and gaming, while sectors such as insurance, banking, and electricity saw declines [1]. International Market - In the U.S. stock market on July 8, the Dow Jones Industrial Average fell by 165.60 points to 44240.76, a decrease of 0.37%. The S&P 500 dropped by 4.46 points to 6225.52, down by 0.07%, while the Nasdaq Composite rose slightly by 5.95 points to 20418.46, an increase of 0.03%. In Europe, major indices all saw gains, with the average price index rising by 0.54% [2]. Commodity Prices - International oil prices increased on July 8, with light crude oil futures for August delivery rising by $0.40 to $68.33 per barrel, a gain of 0.59%. Brent crude for September delivery rose by $0.57 to $70.15 per barrel, an increase of 0.82% [3]. Industry Insights - The China Passenger Car Association reported that domestic retail sales of new energy passenger vehicles reached 1.111 million units in June, marking a year-on-year increase of 29.7%. Cumulatively, retail sales for the first half of the year reached 5.468 million units, up by 33.3% year-on-year [5]. Institutional Perspectives - CICC noted that the current trading activity is a crucial indicator of the capital market's depth and is a significant revenue source for market participants like exchanges and brokerages. The ongoing reforms in market mechanisms are expected to enhance the trading activity in Hong Kong stocks [9]. - Ping An Securities highlighted a recovery in overall demand in the electronics sector, driven by innovations in AI and high-speed communication, which are expected to support PCB demand growth [9]. - Minsheng Securities expressed optimism for the photovoltaic industry, anticipating a rebound as the sector stabilizes from previous price wars and focuses on innovation and value competition [9]. Key Announcements - Taiji Industry announced the formal signing of contracts for its subsidiary Haotai Semiconductor with SK Hynix. Northern Rare Earth reported a recovery in export orders for rare earth products in June, maintaining a positive outlook on future price trends [11].

Group 1 - Tencent's game "Code Name: Cookie Man" has officially started testing recruitment, with expectations to launch testing in mid to late July 2025. The recruitment requires players to have experience in action or card games [1] - If "Code Name: Cookie Man" proves the viability of its "cute + strategic competition" gameplay during testing, it could become a new flagship for Tencent in the casual gaming sector, potentially leading to a reevaluation of the entire casual competitive market by capital [1] - The success of this game could increase attention on similar products from smaller developers, while also highlighting Tencent's resource integration capabilities in the agency publishing sector [1] Group 2 - Hero Game's "Double Helix" has concluded its third test, which began on June 12, 2025, and provided a detailed summary and optimization plan. This test was a limited, paid, and deleted test covering both PC and mobile platforms [2] - The focus on optimizing player experience in the summary is crucial for enhancing player satisfaction and retention rates. A balanced difficulty, convenient controls, and engaging storylines could lead to a stable active user base, which is vital for revenue growth [2] - A stable active user base indicates higher payment potential, which is essential for Hero Game's financial performance [2] Group 3 - Chuangmeng Tiandi's highly anticipated mobile game "Kara Bichu" has announced its long corridor test starting on July 10, 2025, and lasting until July 19, 2025. This test is a limited paid deletion test and is only open to Android platforms [3] - If the long corridor test receives positive player feedback and attracts a large number of participants, it could enhance market expectations for the future commercialization prospects of "Kara Bichu" [3] - Good performance in testing may draw more investor attention to Chuangmeng Tiandi and provide growth potential for revenue after the official game launch, boosting investor confidence in the company's future performance [3]

Group 1 - The "Meta Universe Street" named "Yuanjie Neo World" officially opened in Shanghai, integrating gaming IP industry and urban consumption [1] - The core commercial entity, Xinyao·Guanghuan Live, spans 100,000 square meters, offering a complete ecosystem for secondary dimension consumption, including various cultural landmarks and themed stores [2] - Major gaming companies such as Tencent, NetEase, and miHoYo are establishing a presence in the area, contributing to the production of high-quality content [2] Group 2 - The Xu Hui District Game Industry Service Center has launched new incubators to support game enterprises from startup to growth phases, aiming to create a new generation of innovative entrepreneurial clusters [2] - The "Yuanjie Summer Carnival" will take place from July 18 to August 17, featuring various themed events and activities to promote popular IP merchandise [3]

Market Overview - The market experienced a strong upward trend throughout the day, with the ChiNext Index leading the gains and the Shanghai Composite Index approaching 3500 points [1] - The total trading volume in the Shanghai and Shenzhen markets reached 1.45 trillion, an increase of 245.3 billion compared to the previous trading day [1] Sector Performance - The market saw a diverse range of hot sectors, with over 4200 stocks rising overall [1] - Notable sectors that performed well included computing hardware, photovoltaic concepts, and gaming, while insurance, banking, and electricity sectors faced declines [2] Index Performance - By the end of the trading session, the Shanghai Composite Index rose by 0.7%, the Shenzhen Component Index increased by 1.46%, and the ChiNext Index surged by 2.39% [3]

Core Viewpoint - The article highlights the increasing internal anti-corruption efforts within internet companies, specifically focusing on Bilibili's recent internal report regarding serious misconduct by a senior executive, Zhang Zaimin, and similar actions taken by other companies in the industry [1][4]. Bilibili's Internal Anti-Corruption Measures - Bilibili reported that Zhang Zaimin, former General Manager of the Game Cooperation Department, was arrested for serious job-related crimes during her tenure at the company [1]. - The company emphasized the importance of compliance with national laws and encouraged employees and partners to report any misconduct, assuring strict confidentiality for whistleblowers [2]. - Zhang Zaimin had a significant role in Bilibili's game business, which had previously experienced several quarters of sluggish growth, but saw a notable recovery in Q1 of this year with a 76% year-on-year increase in game revenue, reaching 1.73 billion yuan [3]. Industry-Wide Anti-Corruption Trends - There is a noticeable trend of heightened anti-corruption measures across internet companies, with ByteDance and Perfect World also taking significant actions against internal misconduct [4]. - ByteDance's internal report revealed a case of undisclosed personal relationships leading to conflicts of interest, resulting in the dismissal of involved employees and forfeiture of their bonuses [5][6]. - Perfect World announced an internal investigation revealing multiple violations of company policies and potential criminal activities, leading to police involvement and the detention of several individuals [6]. - NetEase also addressed corruption issues, confirming the investigation and criminal measures against several employees involved in fraudulent activities [6].

Group 1 - The gaming sector is experiencing a strong recovery driven by four key factors: continuous improvement in fundamentals, marginal policy easing, significant valuation repair potential, and innovation driven by AI technology [1][2] - In June, 147 domestic games and 11 imported games were approved, with a total of 812 game licenses issued from January to June, representing a year-on-year increase of 17.9% [1] - In May, the revenue of China's gaming market reached 28.1 billion yuan, a year-on-year increase of 10%, while the mobile gaming market's actual sales revenue was 21.2 billion yuan, growing by 12% [1] Group 2 - The new game cycle is expected to drive continuous improvement in fundamentals, with the gaming sector still having upward valuation elasticity [2] - The gaming sector is catalyzed by multiple factors including AI, content, and changes in commercialization models, with the annual gaming event ChinaJoy approaching, presenting potential investment opportunities in gaming ETFs [2]