Core Insights - Sensor Tower's report reveals that Century Huatong ranks second among Chinese mobile game publishers globally, driven by explosive growth across multiple product categories [1] - The company has three core products listed: "Whiteout Survival" leads the overseas mobile game revenue chart, "Kingshot" secures third place, and "Tasty Travels: Merge Game" debuts at 27th [1] Industry Overview - The global mobile game market is projected to grow steadily, with revenues expected to reach $82.3 billion in 2025, marking a 1.3% increase [4] - The overseas market for mobile games on App Store and Google Play is anticipated to rise by 2%, reaching $69.8 billion [4] - Strategy games are identified as the key growth driver, with a projected 20% increase in global revenue, surpassing $20 billion in 2025 [4] Company Performance - Century Huatong's "Whiteout Survival" has maintained its position as the top overseas mobile game revenue generator for 24 consecutive months [7] - "Kingshot" has rapidly climbed the revenue charts, leveraging a unique art style and innovative gameplay to establish a strong market presence [7] - The company has successfully implemented localized operational strategies, resulting in significant revenue increases in Japan and South Korea, with growth rates of 92% and 70% respectively [7] Market Trends - The casual gaming segment is experiencing robust growth, with the global merge game market projected to increase by 95% in 2025, reaching a market size of over $2.4 billion [8] - "Tasty Travels: Merge Game" has capitalized on this trend, achieving a remarkable 28-fold increase in revenue and debuting at 27th in the overseas revenue rankings [8] - Century Huatong is transitioning from a single blockbuster approach to a multi-category matrix strategy, enhancing its global presence and operational capabilities [8] Future Outlook - The company plans to focus on the casual gaming segment in 2026, aiming to strengthen its dual-track business structure of "SLG + Casual" games [8] - By leveraging its global development capabilities and localized operational experience, Century Huatong aims to capture additional market share in the global mobile gaming landscape [8]

Core Insights - The article highlights the latest trends in gaming, particularly focusing on games that support controllers, offering immersive experiences across various genres such as action-adventure, racing, and strategy [1][6]. Game Recommendations - **Call of Duty Mobile**: A multiplayer first-person shooter developed by Activision and Tencent, featuring high-quality visuals and optimized gameplay for mobile devices, enhancing the shooting experience [1][6]. - **Super Phantom Cat 2**: An action-adventure game nominated for the 2017 TapTap Best Independent Game, known for its accessible gameplay and rich skill mechanics, allowing players to manipulate enemies and explore diverse environments [1][6]. - **Ultra Hardcore Fighting King**: A PVP esports fighting mobile game that simulates arcade controls with an innovative gesture system, emphasizing real combat [7]. - **Dead Cells**: A RogueVania platform action game that challenges players to refine their combat skills and master unique weapons while navigating through unpredictable enemy waves [7]. - **Party Star**: A platform fighting game where players can use various heroes to engage in exciting battles, focusing on unique combat styles [7]. - **Pascal's Wager**: An action RPG set in a world shrouded in darkness, where players control distinct characters to uncover a mysterious story and face formidable enemies [7]. - **War of the Visions: Final Fantasy Brave Exvius**: A tactical RPG that combines strategic gameplay with a rich narrative, appealing to fans of the genre [4]. - **Dusk Diver**: An action RPG that blends exploration and combat in a vibrant urban setting, offering a unique gameplay experience [4]. - **Bit Squad**: A challenging game that involves exploring various planets, acquiring powerful items, and defeating diverse enemies to save endangered galaxies [8]. Industry Trends - The gaming industry is increasingly focusing on controller-supported games, enhancing user experience and engagement through immersive gameplay [1][6]. - The rise of mobile gaming, particularly in the action and adventure genres, indicates a shift in consumer preferences towards accessible yet high-quality gaming experiences [1][6].

Core Insights - Sensor Tower data indicates that the mobile game "Whiteout Survival" by DianDian Interactive has successfully launched a Christmas-themed event, significantly boosting global player spending and securing its position as the top-grossing mobile game for overseas markets, with projected total revenue exceeding $4 billion by December 2025 [1] Group 1: Game Performance and Revenue - "Gossip Harbor" by Lemon Microfun saw a 7% increase in revenue this month, reaching a historical high and ranking second in overseas mobile game revenue [1] - "Call of Duty Mobile" experienced a 36% month-over-month revenue increase due to extensive updates, including a sixth anniversary celebration and new game modes, ranking fifth in revenue [2] - "Genshin Impact" achieved a 47% increase in overseas revenue with the launch of the new version "Moon's Three," climbing five spots to ninth in revenue rankings [2] - "Where Winds Meet," an international version of NetEase's martial arts open-world game, debuted in the overseas market, ranking 27th in overseas mobile game revenue in its first month [3] - "Love and Deep Space" by Die Paper Network saw a 38% increase in overseas revenue, ranking tenth in revenue and fifth in growth, with total overseas revenue surpassing $400 million [4] - "Zero Zone" by miHoYo experienced a 56% increase in overseas revenue, achieving its highest daily revenue since launch and topping various market charts [4] - "Nobunaga's Ambition: True War" launched in Japan, resulting in a 207% increase in overseas revenue, ranking eighth in growth [4] Group 2: Download Rankings - "Block Blast!" by Hungry Studio topped the overseas mobile game download chart with an 11% increase in downloads [6] - "Vita Mahjong" by Vita Studio ranked second in downloads, with over 170 million downloads since its launch in December 2023 [6] - "Mobile Legends: Bang Bang" by Mouton Technology saw an 8% increase in downloads, securing the third position in the download rankings [7]

Core Insights - The mobile gaming industry continues to see significant revenue growth, with several titles achieving record earnings and player engagement in December 2023 [1][2][4]. Group 1: Revenue Highlights - "Whiteout Survival" by DianDian Interactive achieved global cumulative revenue exceeding $4 billion by December 2025, solidifying its position as the top-grossing mobile game in the overseas market [1]. - "Gossip Harbor" by Lemon Microfun saw a 7% increase in revenue this month, reaching a historical high and ranking second in overseas mobile game revenue [1]. - "Call of Duty Mobile" experienced a 36% month-over-month revenue increase, ranking fifth in overall revenue due to significant updates and events [2]. - "Genshin Impact" by miHoYo reported a 47% increase in overseas revenue, climbing five positions to rank ninth in revenue [2]. - "Where Winds Meet," the international version of "燕云十六声" by NetEase, entered the overseas revenue rankings at 27th place in its first month [3]. - "恋与深空" by Paper Games saw a 38% increase in overseas revenue, ranking tenth in revenue and fifth in growth [4]. - "绝区零" by miHoYo experienced a 56% increase in overseas revenue, achieving its highest daily revenue since launch [4]. - "信长之野望 真战" by Lingxi Interactive saw a 207% increase in overseas revenue after launching in Japan [4]. Group 2: Download Performance - "Block Blast!" by Hungry Studio led the download rankings with an 11% increase in downloads, reaching a historical high [5]. - "Vita Mahjong" by Vita Studio ranked second in downloads, surpassing 170 million total downloads since its launch in December 2023 [5]. - "Mobile Legends: Bang Bang" by Mutong Technology saw an 8% increase in downloads, maintaining its position in the top three for downloads [5].

Core Viewpoint - The evolution of the Chinese shooting game industry over the past 20 years has transformed it from a niche market to a significant player in the global gaming landscape, with substantial growth potential and recognition in the FPS genre [60][63]. Group 1: Historical Context - In 2004, a pivotal moment occurred when a Chinese player, Meng Yang, defeated the renowned American gamer "Fatal1ty" in a major FPS competition, marking a significant achievement for Chinese esports [1]. - Despite early successes, the Chinese shooting game market struggled for recognition and profitability, with many industry players doubting its viability [3][9]. - The dominance of MMO games in the early 2000s overshadowed shooting games, leading to a lack of investment and development in the FPS genre [9][11]. Group 2: Industry Development - Tencent's strategic pivot towards shooting games began with the acquisition of "CrossFire" and "King of Battlefield," which were initially seen as low-potential projects [12][14]. - "CrossFire" underwent significant adjustments to appeal to a broader audience, leading to its successful launch in 2008, which opened the floodgates for the domestic shooting game market [19][24]. - The release of "Call of Duty 4: Modern Warfare" in 2007 set a new standard for FPS games globally, but Chinese developers were slow to adapt to this model [27][29]. Group 3: Recent Trends and Innovations - The rise of mobile gaming in 2014 provided a level playing field for Chinese developers, allowing them to compete globally with heavy shooting mobile games [31][33]. - "CrossFire: Gun Battle" successfully adapted the FPS experience for mobile, demonstrating that complex shooting mechanics could be effectively implemented on mobile platforms [35][37]. - The emergence of battle royale games in 2017, such as "PUBG Mobile," showcased the capabilities of Chinese developers to create competitive products that resonated with global audiences [38][40]. Group 4: Current Market Position - As of 2023, the Chinese shooting game market has grown significantly, contributing over 100 billion yuan to the gaming industry and becoming the second-largest game category in China [60][63]. - Chinese developers are increasingly recognized for their innovative gameplay mechanics and ability to adapt to market demands, positioning them as leaders in the global shooting game sector [49][55]. - The ongoing development of new gameplay styles, such as extraction shooters, indicates a proactive approach to evolving the FPS genre and meeting player expectations [52][54].

Core Insights - The 2025 Cologne International Game Show will take place in Cologne, Germany, from August 20 to 24, and is recognized as Europe's largest and most authoritative interactive entertainment exhibition, focusing on game hardware, software, technology, and related content [1][3] Group 1: Exhibition Overview - The event attracted 1,500 exhibitors from 72 countries and regions, marking an 11% increase from the previous year, setting a historical record for the Cologne International Game Show [4] - The exhibition area reached a record 233,000 square meters, featuring various segments including interactive gaming experiences, cosplay performances, independent games, card games, artist zones, and merchandise sales [9] Group 2: Chinese Participation - Over 50 Chinese exhibitors participated, a 32% increase from last year, showcasing new titles such as Tencent's "Honor of Kings World," "Delta Action," and "Crossfire: Rainbow" [13] - The presence of Chinese games in Europe has significantly increased, with Germany being the largest game market in Europe, housing approximately 37.5 million gamers [17] Group 3: Awards and Recognitions - The mobile game "Love and Deep Space" by Paper Games won the Best Mobile Game award, becoming the first female-oriented game to achieve this honor at the Cologne Game Show [19] - Other notable nominations included "Genshin Impact" and "Tomorrow's Ark" for Best Mobile Game, and "Shadow Blade Zero" for Best Sound Effects [24][26] Group 4: Major Game Releases and Innovations - Tencent's TiMi Studio Group showcased several titles, including "Delta Action," which announced cross-platform support for PC, mobile, and console [26] - The new game "Black Myth: Zhong Kui" was unexpectedly revealed, focusing on a new hero and gameplay, although its release is projected to be three years away [29] Group 5: Japanese Dominance - Japanese companies excelled at the event, with Capcom winning multiple awards for "Resident Evil 9: Requiem," including Best Visual Effects and Best PlayStation Game [42] - Nintendo also received accolades for innovative gameplay with "Donkey Kong: Banana Power" and topped the Switch 2 sales chart with "Mario Kart: World" [46]

Core Viewpoint - The Chinese gaming industry is transitioning from merely exporting products to a comprehensive globalization of the entire upstream and downstream industry chain [1] Policy Background - The policy "foreign-funded game companies developing games in Shanghai are treated as domestic games" aims to promote the agglomeration of the digital content industry in Shanghai [2] - This measure is part of a broader policy framework, including the "Fair Competition Review Regulations" passed by the State Council, which aims to ensure fair competition and expand high-level opening-up [3] Industry Development - Since 2014, Shanghai has initiated a pilot program for the territorial management of domestic online games, allowing local authorities to directly review and approve game licenses [4] - The "Accelerating the Comprehensive Pilot Work Plan for Expanding the Opening-up of the Service Industry" further promotes territorial management trials for domestic online games across multiple regions [6] Policy Impact - The new policy is expected to significantly reduce the time and uncertainty for foreign-funded game companies entering the Chinese market, aligning the approval process for foreign games with that of domestic games [8] - Historically, the approval process for imported games has been much longer than for domestic games, with delays often exceeding 12 months [8] Future Outlook - The policy may lead to more foreign-funded game companies being able to engage in various activities from development to operation in China, potentially creating new jobs and competitive products [11] - There are considerations regarding the expansion of this policy to other cities and the potential relaxation of operational requirements for foreign game companies [12] - The introduction of more favorable policies for the gaming industry is anticipated, particularly benefiting small and medium-sized enterprises [13] Industry Trends - The gaming industry is witnessing a shift as major companies relocate development teams to second-tier cities, indicating a proactive approach by local governments to attract gaming enterprises [15]

Core Viewpoint - The Shanghai Municipal Government has introduced measures to promote the high-quality development of the software and information services industry, particularly focusing on attracting foreign game companies to establish R&D teams in Shanghai by treating their products as domestic games for licensing purposes [1][3]. Group 1: Policy Measures - The measures aim to invigorate the operational vitality of software and information service enterprises, support AI-driven upgrades, cultivate new growth drivers, and reduce costs for companies in the sector [1]. - A notable aspect is the pilot policy allowing foreign game companies' products developed in Shanghai to be treated as domestic games, which is expected to enhance their chances of obtaining game licenses [1][6]. Group 2: Market Context - Shanghai is a preferred entry point for foreign game companies due to its status as a highland of openness in China, with many well-known firms like Ubisoft and Blizzard establishing their Chinese headquarters there [3]. - Despite having many foreign company headquarters, Shanghai has struggled to attract direct game development due to operational qualifications and licensing restrictions, limiting its industry scale [3][4]. Group 3: Competitive Landscape - The competition among cities for the game industry is intense, and Shanghai's ability to convert foreign company headquarters into substantial investments and a robust industry ecosystem is crucial [3][4]. - Local game companies in Shanghai, while established, lack the scale and experience compared to giants like Tencent and NetEase, making it essential for Shanghai to offer more attractive pathways for foreign collaboration [4]. Group 4: Licensing and Regulatory Challenges - The likelihood of foreign game companies obtaining domestic game licenses is significantly higher, with 1,306 domestic game licenses issued in 2024 compared to only 110 for imported games [6]. - However, obtaining a license still requires compliance with additional regulations, such as APP filing and possessing an ICP license, which presents further challenges for foreign companies [7]. Group 5: Future Implications - The pilot policy is seen as timely, as many foreign companies are looking to cut costs and may find it advantageous to establish R&D teams in Shanghai, leveraging local talent and reducing communication barriers [5]. - The actual impact of these measures on foreign game companies will depend on subsequent policies and their integration with existing regulatory frameworks [7].

Investment Rating - The report maintains a "Buy" rating for Tencent Holdings [4] Core Views - The company has exceeded revenue and profit expectations, with Q1 2025 revenue reaching 1800.2 billion yuan, a year-on-year increase of 12.9%, surpassing Bloomberg's consensus estimate of 1756.0 billion yuan. Non-IFRS net profit was 613.3 billion yuan, up 22.0% year-on-year, also exceeding expectations [2][14] - AI is making substantial contributions to the gaming and advertising industries, enhancing product differentiation and driving revenue growth [3][4] Summary by Sections Revenue and Profit Performance - Q1 2025 revenue was 1800.2 billion yuan, up 12.9% year-on-year, exceeding expectations [2][14] - Non-IFRS net profit for Q1 2025 was 613.3 billion yuan, reflecting a year-on-year increase of 22.0%, also above consensus estimates [2][14] Gaming Business - Online gaming revenue reached 595 billion yuan in Q1 2025, a 23.7% year-on-year increase, surpassing expectations [20] - Domestic gaming revenue was 429 billion yuan, up 24.3% year-on-year, while international gaming revenue was 166 billion yuan, up 22.1% year-on-year [21] Advertising Revenue - Advertising revenue for Q1 2025 was 319 billion yuan, a 20.4% year-on-year increase, exceeding expectations [24] - The growth in advertising revenue is attributed to increased user engagement, AI upgrades, and optimization of the WeChat ecosystem [24] Financial Technology and Enterprise Services - Financial technology and enterprise services revenue was 549 billion yuan in Q1 2025, a 5.0% year-on-year increase, slightly below expectations [28] - The growth in financial technology is driven by consumer loan services and wealth management services [28] Profitability Metrics - Overall gross margin for Q1 2025 was 56%, up 3 percentage points year-on-year, driven by high-margin revenue sources [33] - The gross margin for value-added services was 60%, reflecting growth in both domestic and international gaming revenue [33] Future Earnings Forecast - The report forecasts adjusted net profits of 2441 billion yuan, 2693 billion yuan, and 2984 billion yuan for 2025, 2026, and 2027 respectively, with corresponding PE ratios of 18, 16, and 14 times [4][43]

Core Insights - Tencent Games held the "SPARK2025" event, showcasing 46 game updates, including 24 new titles across various platforms [1][2] - The event marks Tencent's first major business display following the release of its 2024 financial report, which indicated total gaming revenue of 197.7 billion yuan [2][12] - Tencent aims to build a "production + distribution + investment" ecosystem to enhance its market share and secure future technologies amid a slowing industry growth [2][13] Game Production - Tencent's subsidiaries, including TiMi, Lightspeed, and others, presented 18 game updates, with several titles entering pre-registration or testing phases [5] - The flagship IP "Honor of Kings" announced multiple derivative projects, including an animated series and esports events, with the KPL finals expected to attract 50,000 viewers [5] - The game "Call of Duty Mobile" achieved over 1 billion global downloads in 2024, with plans for collaborations with other major IPs [6] Game Distribution - Tencent showcased 13 new games and 7 updates for popular titles, highlighting its diverse distribution strategy [8] - The domestic version of "Path of Exile 2" is set for a pioneer test this year, while "THE FINALS" will enter public testing in the second half of the year [8] - Tencent is focusing on cross-platform strategies, with several games enabling data interoperability between mobile and PC versions [9] Investment Strategy - Tencent's investment strategy emphasizes global expansion and exploration of innovative game genres, showcasing works from 8 invested studios [10] - A notable investment includes Tencent's 1.16 billion euro (approximately 9 billion yuan) stake in Ubisoft's new subsidiary, enhancing its presence in the AAA game sector [10] - The trend of "going global" is recognized as a common strategy among game developers, with companies like Century Huatong also achieving significant success in overseas markets [11] Future Outlook - Tencent's gaming business is expected to continue stable growth, although it faces challenges such as high dependency on core products and increasing global competition [12] - The company plans to increase R&D investments, particularly in AI technology, and enhance its global operational capabilities [13] - The "SPARK2025" event's showcased products and technological innovations reflect Tencent's strategic initiatives to optimize its gaming business structure and reshape industry competition [13]