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Chinese video gaming house miHoYo sees revenue surge on back of blockbuster titles as it closes in on Tencent and NetEase

Shanghai-based video games developer miHoYo nearly tripled its revenue in the last three years, according to Chinese media, as it emerges as the main domestic challenger to Tencent Holdings and NetEase in the world's largest gaming market.

As a private company miHoYo is not obliged to disclose its financial details, but it has submitted some financial data to authorities.

In 2022, the company racked up revenue of 27.34 billion yuan (US$4.2 billion), generating a net profit of 16.15 billion yuan, according to a report by state-owned newspaper Guangming Daily on Thursday. The report also listed the company as one of China's "Top 30 Chinese Culture Enterprises".

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The newspaper reported earlier that miHoYo's revenue reached over 20 billion in 2021, without providing a precise figure. In 2021, another official newspaper in Shanghai put the gaming house's revenue at 10.1 billion yuan in 2020, roughly one third of the reported figure for 2022.

The revenue surge at miHoYo comes on the back of roaring success for its Genshin Impact title, which propelled it to its current position as the third-largest gaming company in China, after Tencent and NetEase respectively.

Tencent, which operates the world's largest video gaming business, posted revenue of 170.7 billon yuan for its video gaming business in 2022, down 2 per cent from a year ago, while NetEase's gaming revenue surged 10 per cent to 74.6 billion yuan.

miHoYo, which has remained privately-owned since its creation in 2011 by three engineering postgraduates from Shanghai Jiao Tong University - Cai Haoyu, Liu Wei and Luo Yuhao - has never publicly disclosed financial figures for the whole company or for any of its individual game titles.

The state-owned newspaper also praised miHoYo as a good example of overseas expansion by a domestic video games developer, saying it has "created a window for foreign players to understand China" that makes Chinese elements "an important gene" when it comes to the overseas expansion of Chinese video game titles.

Genshin Impact, which was launched in September 2020, had bagged US$4 billion in global revenue by the end of 2022, according to data from US app analytics firm Sensor Tower, making it one of the most successful Chinese video games of all time and marking the rise of China-developed games.

Last November, miHoYo saw its monthly mobile gaming revenue overtake NetEase's sales, making it the second highest-grossing mobile games publisher in China for the first time in over a year, according to Sensor Tower. Although NetEase regained the position in January and March, miHoYo took the second spot again in April and May.

Meanwhile, miHoYo's latest blockbuster title Honkai: Star Rail, a role-playing anime-style game launched in late April, recently eclipsed Genshin Impact to become the biggest global launch of any Chinese video game.

This article originally appeared in the South China Morning Post (SCMP), the most authoritative voice reporting on China and Asia for more than a century. For more SCMP stories, please explore the SCMP app or visit the SCMP's Facebook and Twitter pages. Copyright © 2023 South China Morning Post Publishers Ltd. All rights reserved.

Copyright (c) 2023. South China Morning Post Publishers Ltd. All rights reserved.