(Yicai) Sept. 3 -- The Chinese gaming market grew over 12 percent to CNY188.5 billion (USD28.1 billion) in the first half of the year, with most revenue concentrated among leading firms and a few enduring products, according to an official report.

China had 684 million gaming users in the first half of the year, up just 0.8 percent from a year earlier, according to a report by the Game Publishing Committee of the China Audio-Video and Digital Publishing Association.

A clear K-shaped differentiation is emerging at the enterprise level in the Chinese gaming market, Jiang Xiaoxiao, managing director of China Insights Consultancy, told Yicai. The double-digit growth in the first half was primarily driven by leading companies and a few blockbuster products, while mid-to-long tail products did not perform well, he added.

Tencent Games reported first-half revenue of CNY130.1 billion, up 10 percent from a year earlier. Revenue from the Chinese market climbed 11 percent to CNY92.7 billion (USD13.8 billion), and overseas revenue rose 6 percent to CNY37.4 billion.

Six of the top 10 Chinese mobile games by revenue in July were developed by Tencent Games, including the four highest-grossing ones, according to Gamma Data statistics.

NetEase’s gaming revenue expanded 8.3 percent to CNY50.7 billion in the first half from the same period last year, ranking second in China.

Zhejiang Century Huatong Group, the third largest firm by gaming revenue, achieved revenue growth of 28 percent in the six months ended June 30, mainly thanks to blockbuster products, such as Whiteout Survival.

Meanwhile, Giant Network Group hit the jackpot with Tomb Busters, which generated over CNY5 billion (USD740 million) in revenue since January in 2025, driving the company's revenue and profits to double from a year earlier.

The scale of leading games is becoming larger and larger, said Liu Yi, vice president of publishing at Kingsoft World Games. Meanwhile, new traffic dividends from minigames on platforms like WeChat and Douyin are mainly being captured by a few small companies, putting significant pressure on mid-tier firms, Liu added.

Major internet companies are exiting the gaming sector. For instance, ByteDance sold Moonton Technology to Saudi Arabia's Savvy Games Group for over USD6 billion in March, and Alibaba Group Holding sold Lingxi Games to Trustar Capital last month, with market reports indicating the transaction price exceeded USD1.5 billion.

Both Moonton and Lingxi Games have well-known representative works and sustainable revenue-generating capabilities, indicating they are not loss-making assets worth divesting.

Editor: Futura Costaglione