Chinese video gaming revenue falls in May, a third month of decline amid slowing economy and less player spending

China’s video gaming revenue fell 6.7 per cent to US$3.4 billion in May, driven mostly by a decline in mobile game spending

After months of regulatory uncertainty, Chinese gaming studios are now grappling with a slowing economy and less consumer spending amid Covid-19 controls

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A man looks at the page of Apple’s App Store for PUBG Mobile, which is owned by Chinese internet giant Tencent, on September 2, 2020. Chinese video game companies saw a decline in revenue in May, both at home and abroad. Photo: AFP

Published: 9:00pm, 23 Jun 2022

Chinese video gaming revenues dropped in May, according to a new report, as the industry struggles to bounce back from the impact of regulatory uncertainties and a slowing economy.

Industry revenue declined 6.74 per cent last month year on year to 22.9 billion yuan (US$3.4 billion), and it was down 0.31 per cent from April, according to a report published by research firm Gamma Data on Wednesday.

The decline was primarily driven by a drop in mobile game revenue, which fell 10.85 per cent year on year to 16.6 billion yuan for the month. The figure was also down 2.15 per cent from April, according to the new report.

In addition to blockbuster titles bringing less money compared with last year, newly launched mobile games showed “lacklustre performance”, Gamma Data said in the report.

May marked the third consecutive month with a year-on-year revenue decline, according to the report. While in the first quarter the industry saw revenues rise 3.17 per cent, the latest drop comes after regulators approved 105 new titles for sale in the country following an eight-month hiatus.

The video game licensing freeze started last summer after Beijing introduced new regulations curtailing playing time for minors. The regulatory campaign put thousands of small game studios out of business and clipped the growth of gaming giants Tencent Holdings and NetEase, neither of which had titles included on the last two approval lists released in April and earlier this month.

TikTok owner ByteDance also reportedly shut down a game development studio it acquired just three years ago, cutting more than 100 jobs in a major retreat from the country’s once-booming gaming industry.

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Chinese video gaming revenue falls in May, a third month of decline amid slowing economy and less player spending

China’s video gaming revenue fell 6.7 per cent to US$3.4 billion in May, driven mostly by a decline in mobile game spending After months of regulatory uncertainty, Chinese gaming studios are now grappling with a slowing economy and less consumer spending amid Covid-19 controls

China’s video gaming revenue fell 6.7 per cent to US$3.4 billion in May, driven mostly by a decline in mobile game spending

After months of regulatory uncertainty, Chinese gaming studios are now grappling with a slowing economy and less consumer spending amid Covid-19 controls