Market Growth - The mini-game market, also known as mini-program games, has experienced explosive growth, with a compound annual growth rate of 182.3% from 2022 to 2024, reaching nearly 400 billion yuan in 2024, a year-on-year growth of 99.18% [2][3] - Douyin's mini-game business saw a 130% increase in revenue and a 320% growth in paid user base in 2024 [2] Industry Potential - The mini-game market is expected to become the "second curve" of growth for the gaming industry, alongside the potential for PC games to leverage short video platforms for long-term marketing [3] - Tencent's mini-game platform has reached 1 billion users, with 500 million monthly active users and over 240 games generating over 10 million yuan in quarterly revenue [3] Company Strategies - Companies like Mingchen Health are increasing investments in mini-games, indicating that mini-games will be a key focus for future development [4] - 37 Interactive Entertainment has launched several successful mini-game products, with titles like "Time Explosion" and "Heroes No Flash" performing well in sales rankings [5] - Fuchun Co. plans to continue testing and optimizing mini-game products, aiming for a breakthrough in profitability by early 2025 [5] Monetization Models - The IAAP model, combining in-app advertising and in-app purchases, has emerged as a mainstream monetization strategy for mini-games, challenging previous assumptions about revenue limitations [2][6] - Mini-game developers are focusing on long-term growth strategies, ensuring player experience through thoughtful design and leveraging IP collaborations for sustained engagement [6]

Core Viewpoint - The gaming market in China is witnessing the return of two major titles, Tencent's "Victory Goddess: New Hope" and Bilibili's "Shining! Yujun Girl," both of which have shown unexpected market performance after their respective launches [1][22]. Group 1: Game Performance - "Shining! Yujun Girl" had a long development cycle of five years and was initially launched in Japan in February 2021, generating over 5.1 billion yuan in its first month and approximately 50 billion yuan in total revenue for the year [3][17]. - The game returned to the Chinese market on May 22, 2023, after nearly two years of absence, but its performance has been underwhelming, with only 203 million yuan in revenue over 12 days on iOS [6][12]. - "Victory Goddess: New Hope" generated 24 million yuan in revenue within its first 12 days, which is significantly lower than other major titles like "Dungeon and Fighter: Origin" [32][37]. Group 2: Market Dynamics - Both games faced challenges in their marketing strategies, with "Shining! Yujun Girl" opting for a low-profile re-launch that coincided with the release of "Victory Goddess," impacting its visibility and player engagement [16][37]. - The download trends for "Shining! Yujun Girl" showed a decline, with approximately 66,000 downloads over 12 days, indicating a lack of sustained interest [12][25]. - The competitive landscape in the Chinese mobile gaming market is intensifying, with players becoming more selective and demanding higher quality content, making it increasingly difficult for overseas titles to succeed upon their return [37][38]. Group 3: Future Outlook - The future success of "Shining! Yujun Girl" will depend on the developers' willingness to invest in marketing and content optimization to attract new and returning players [16][37]. - The performance of "Victory Goddess" is being closely monitored, as its initial results are considered average compared to expectations set by its overseas success [32][37]. - The overall trend suggests that the chances of overseas games succeeding in the Chinese market are diminishing, with local developers having a better chance of success with self-developed titles [37][38].

Core Insights - The startup project led by former producer of "White Night Extreme," known as "墨犬科技," has ceased development after initial excitement and funding expectations [1][15]. Company Overview - The founder, 贾晨, previously worked at Tencent's subsidiary, 北京永航科技, where he was the producer and art director for "White Night Extreme" [1]. - The new company, 北京墨犬科技, aimed to create a significant and innovative product, with a team comprising several key members from 永航科技 [1]. Project Details - The initial project, internally named "Code:墨犬一号," was a 3D ARPG developed using UE5, but it was still in a very early stage with a rough appearance [3]. - The game was intended to feature open-world exploration elements, allowing players to collect resources and engage in combat with various monsters [3][9]. - The project faced skepticism due to the team's lack of experience in 3D game development and the high costs associated with such projects [11]. Market Context - The gaming industry has seen a significant increase in competition, particularly in the 2D and open-world genres, making it challenging for new entrants [11]. - "White Night Extreme" had a promising start but ultimately faced a decline in performance, leading to its shutdown in late 2023 [13][15]. Future Directions - Following the project's cancellation, the company is reportedly pivoting to a new urban evolution-themed game set in the Northeast industrial era [18]. - Recent job postings indicate a shift in focus towards creating high-quality effects in a magical realism style, suggesting a change in artistic direction [18]. Industry Dynamics - The departure of key personnel from 永航科技 has led to internal restructuring, with new companies being formed and existing ones undergoing significant changes [18]. - The competitive landscape remains intense, with established companies also struggling to maintain momentum in their projects [11].

Core Insights - The gaming industry is experiencing an "arms race" in AI technology, with Tencent launching its "Hunyuan Game" platform aimed at revolutionizing the art production process in gaming [2][3] - Tencent's approach focuses on transforming the entire art production chain by leveraging AI to automate and streamline processes, allowing designers to input simple text or sketches to generate comprehensive visual assets [3][5] - The platform is currently in a free trial phase, raising questions about its future commercialization and potential impact on the industry [2][4] Group 1: AI Integration in Game Development - Tencent's "Hunyuan Game" aims to address inefficiencies in art production, particularly for small to medium-sized teams that struggle with quality and cost in outsourcing [3][5] - The platform allows for rapid generation of art resources, significantly reducing the traditional production timeline from weeks to a much shorter duration [3][6] - The integration of AI is seen as a tool to assist rather than replace human creativity, enabling designers to focus on higher-level creative tasks [6][7] Group 2: Market Position and Future Prospects - Tencent is committed to investing in AI capabilities, with a record capital expenditure of 76.7 billion yuan in the previous year and plans for further investment in AI applications across its business units [8][9] - The company is also focusing on collaboration with Tencent Cloud to provide tailored solutions for game developers, thereby lowering the barriers to AI technology adoption [9] - The launch of "Hunyuan Game" signals the beginning of an "AI-assisted era" in game art production, with aspirations to develop a comprehensive AI content generation engine for the gaming industry [9]

Core Viewpoint - Tencent is developing an AI-driven game creation solution called "VISVISE," which includes various development tools like Auto LUV and Skirt AI, indicating a significant investment in AI technology for game development [1] Group 1: AI Game Development Tools - Tencent's GoSkinning team has created tools such as Auto LUV and Skirt AI as part of the VISVISE initiative, showcasing a comprehensive approach to AI in game development [1] - The company is actively developing various AI game tools to enhance its offerings in the gaming sector [1] Group 2: Industrial-Grade AIGC Platform - Tencent's mixed yuan has launched an industrial-grade AIGC game content production engine, which significantly optimizes game asset generation and production processes [1] - The platform can accurately replicate various artistic styles and themes, including "thick paint," "celluloid," and "cyberpunk," demonstrating its versatility in generating high-consistency game content [1] Group 3: Financial Impact and Industry Trends - During the Q1 earnings call, Tencent's CEO Ma Huateng noted that AI capabilities have already made substantial contributions to businesses like Changqing Games [1] - Other companies in the industry, such as NetEase and miHoYo, are also increasing their investments in AI game development, indicating a broader trend towards AI integration in gaming [1]

Core Viewpoint - The gaming sector is experiencing significant growth, driven by long-term products and increasing overseas sales, with notable performance from leading companies in the industry [1][2][3]. Group 1: Market Performance - In April 2025, the Chinese gaming market reached a scale of 273.51 billion yuan, marking a year-on-year growth of 21.93% and a month-on-month increase of 2.47% [1][3]. - The mobile gaming market in China for April 2025 was valued at 204.24 billion yuan, showing a year-on-year growth of 28.41% and a month-on-month growth of 3.07% [1][2]. - The overseas sales revenue of Chinese self-developed games in April 2025 was 15.54 billion USD, reflecting a year-on-year increase of 9.62% [2]. Group 2: Growth Drivers - The growth in the gaming market is primarily driven by long-term products with operational cycles of one year or more, such as "Honor of Kings" and "Genshin Impact" [3]. - The issuance of gaming licenses has stabilized, with 654 licenses granted by May 2025, including 610 for domestic games, which supports the supply side of the gaming industry [2]. - AI advancements are expected to significantly reduce game development costs and shorten production cycles, enhancing the industry's growth potential [2]. Group 3: Investment Opportunities - The performance of leading gaming companies is expected to improve due to their ability to leverage IP operations and content iteration, creating sustainable profitability [3]. - The exploration of AI in gaming is seen as a potential catalyst for value reassessment of related listed companies, especially if new game products exceed expectations [3].

Group 1 - The Chinese gaming market is projected to reach 27.351 billion yuan by April 2025, representing a year-on-year growth of 21.93%, with mobile gaming growing by 28.41% and overseas revenue increasing by 9.62% [1] - Deepseek R1 has demonstrated global leadership in deep thinking capabilities, surpassing o3 and Gemini 2.5 Pro in digital testing AIME2024 and code testing LiveCodeBench, with a 15% improvement over the previous version [1] - The advancement of artificial intelligence is expected to boost the gaming sector, as the industry is a mature application area for AI, with potential new gameplay emerging from the integration of large language models [1] Group 2 - The ability of R1 in text understanding and creative writing has improved, with a reduction in hallucination rates for rewriting, summarizing, and reading comprehension by 45%-50%, and significant growth in long-form writing and role-playing capabilities [1] - Future developments may allow large language models to endow game characters with independent personalities, enabling them to perform actions and behaviors within the virtual world, potentially creating new gameplay experiences [1]

Group 1 - The gaming sector experienced a strong rally, with companies like Giant Network and Electric Soul Network hitting the daily limit, and Changqu Technology rising over 14% [1] - The approval of 130 domestic and 14 imported games in May marks a record high for monthly approvals in nearly two years, indicating a recovery in the industry [3] - Major companies such as Perfect World and Century Huatong have products that received approval, with Perfect World's "Yihuan" currently in development and expected to enter testing soon [3] Group 2 - The gaming market in China is projected to reach 27.351 billion yuan by April 2025, with a year-on-year growth of 21.93%, driven by mobile games and overseas revenue [3] - Long-term revenue growth is supported by established products like "Honor of Kings" and "Genshin Impact," highlighting the industry's healthy development trend [3] - Wanlian Securities suggests that the high volume of game approvals and diverse product types indicate a stable recovery in the industry, recommending attention to leading companies with strong product pipelines and R&D capabilities [4]

Group 1 - The A-share gaming sector experienced a significant rise, with the gaming ETF (159869) increasing by over 4% in early trading on June 3rd, 2023 [1] - Key stocks such as Zhangqu Technology surged over 15%, while Giant Network, Dihun Network, and Borui Communication approached their daily limit, indicating strong market performance [1] - April gaming revenue saw a year-on-year growth of over 20%, driven by long-term products, with the Chinese gaming market projected to reach 273.51 billion yuan by April 2025, reflecting a 21.93% increase [1] Group 2 - Mobile gaming revenue is expected to grow by 28.41% year-on-year, while overseas revenue is projected to increase by 9.62%, primarily fueled by long-term products like "Honor of Kings" and "Genshin Impact" [1] - Huaxi Securities highlights that the long-term revenue growth underscores a healthy development trend in the industry, with leading companies leveraging IP operations and content iteration for sustained profitability [1] - The issuance of domestic game licenses has increased, with 130 domestic and 14 imported licenses granted in May 2025, contributing to improved industry confidence [1] Group 3 - The approval of game licenses across multiple platforms indicates a normalization trend in the regulatory environment, with a total of 610 domestic and 44 imported licenses issued in 2023, significantly higher than the same period in 2024 [1] - The industry's fundamentals are gradually improving due to the continuous optimization of license supply, strong overseas performance, and the launch of new games [1] - The application of AI technology and long-term operational capabilities are becoming key competitive advantages for companies in the gaming sector [1]

Group 1 - Eagle Horn Network's multiplayer cooperative adventure game "Bubble Bubble" was officially released on June 2, with a standard version priced at 66 yuan and a "Many Clothes Version" at 84 yuan, both enjoying a 10% launch discount [1] - The launch of "Bubble Bubble" reflects Eagle Horn Network's strategy to expand its product line, which supports performance expectations for its related business segments [1] - The introduction of new games increases market attention for the gaming sector [1] Group 2 - "Plants vs. Zombies 3" has announced the start of the "Element 1+1" testing recruitment, with the mobile game having received a license in February and is expected to launch on July 18 [2] - The testing recruitment for "Plants vs. Zombies 3" indicates the company's emphasis on product promotion, bringing positive signals for business development expectations [2] - The testing of a well-known IP new title generates market anticipation within the gaming sector [2] Group 3 - The preview trailer for the 2025 Summer Game Fest was released, with the event scheduled to be live-streamed on June 7, lasting approximately two hours [3] - The trailer showcases games that have been released or announced for upcoming release, indicating a wave of new product showcases in the gaming industry [3] - The Summer Game Fest enhances market attention and reflects the innovative vitality of the gaming industry [3]