The Chinese gaming market has entered a phase of intense competition for a static user base, with divergent trends across different game categories in the first half of 2026.
Total domestic game sales reached 188.45 billion yuan in the first six months of the year, a 12.17% increase year-on-year, according to a report released by the China Audio-video and Digital Publishing Association at the China Digital Entertainment Expo on July 30. The user base grew by only 0.82% to 684 million, indicating that industry growth is now almost entirely dependent on spending per existing player rather than attracting new users.
Mobile games remain the dominant revenue source, generating 135.21 billion yuan, which accounts for 71.75% of the total market. However, the segment's growth rate slowed to just 7.9%. In contrast, PC gaming is experiencing a resurgence, with sales hitting 45.288 billion yuan, a sharp 27.92% increase year-on-year. This growth rate is roughly four times that of the mobile sector. The report attributes the PC market's revival to "cross-platform titles and long-running blockbuster PC games."
The fastest-growing segment is mini-program games, which generated 31.657 billion yuan in revenue, up 36.01% from the same period last year. Within this category, in-app purchase revenue rose 38.12% to 21.137 billion yuan, increasing its share of total mini-program revenue from 63.8% to 66.8%. Advertising revenue grew 31.94% to 10.52 billion yuan, but its share fell to 33.2%. A separate report from iResearch, published on July 10, notes that mini-program games are evolving from casual, light-entertainment formats to more mid-core offerings, with monetization models shifting from pure advertising to a mix of ads and in-app purchases.
The anime-themed game segment, however, delivered a disappointing performance. Revenue from mobile anime games fell 8.97% year-on-year to 13.269 billion yuan. The report attributes the decline to falling revenue from some long-running top titles, which new releases failed to offset. The console game market also contracted, with sales of 961 million yuan, down 7.06%, largely due to the natural cooling of excitement following last year's release of the blockbuster "Black Myth: Wukong."
Artificial intelligence continues to deepen its integration, with 86% of games now using AI tools. On the Steam platform, the number of games labeled as AI-assisted has surpassed 10,000, accounting for over 8% of the total library.
Overseas revenue growth is significantly outpacing the domestic market. Chinese self-developed games earned 12.372 billion U.S. dollars in the first half of 2026, a 30.22% increase year-on-year. Strategy games led the export market with a 46.91% share of revenue, followed by the 'synthesis' genre at 16.22%.
Financial results for listed companies reflect this trend of market divergence. Zhejiang Century Huatong Group Co.,Ltd. (002602.SZ) reported preliminary revenue of approximately 22 billion yuan for the first half of 2026, a 28% increase year-on-year, with net profit attributable to shareholders rising 61.87% to 79.57% to between 4.3 billion and 4.77 billion yuan. The company has achieved sequential revenue growth for 12 consecutive quarters.
Giant Network Group Co.,Ltd. (002558.SZ) expects net profit attributable to shareholders for the first half to be between 2 billion and 2.2 billion yuan, a staggering 157.38% to 183.12% increase year-on-year. The company attributed the strong performance to its title "Supernatural Action Team," which has accumulated over 200 million registered users and generated more than 5 billion yuan in total gross revenue by the end of the first quarter of 2026.
Not all companies are benefiting from the industry's growth. Perfect World Co.,Ltd. (002624.SZ) swung to a loss, projecting a net loss of 80 million to 120 million yuan for the first half. The company explained that the loss was not due to poor product performance. Its major new title "The Strange Ring," which launched in April 2026, has generated over 1.4 billion yuan in global gross revenue by June 30. However, a time mismatch between marketing expenses and revenue recognition led to the book loss. The company stated that the game's contribution to financial results will become apparent from the third quarter onward.
The two industry giants, TENCENT (00700.HK) and NTES-S (09999.HK), continued to show stable performance. In the first quarter, TENCENT's domestic gaming revenue was 45.4 billion yuan, up 6% year-on-year, while international gaming revenue rose 13% to 18.8 billion yuan. As of the end of June, "Honor of Kings" has surpassed 17.5 billion U.S. dollars in global cumulative revenue, and "Delta Force" has exceeded 900 million U.S. dollars. NTES-S's gaming and related value-added services revenue in the first quarter reached 25.7 billion yuan, a 6.9% increase year-on-year. The company's title "Where Winds Meet" has attracted over 80 million global players, with overseas revenue reaching an all-time high, while "Naraka: Bladepoint" has sold over 25 million copies worldwide.
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