On October 22, the National Press and Publication Administration announced that 159 domestic video games received licenses for October 2025, while 7 imported games were also approved. This number is the second highest this year after August's 173 games. According to Kaiyuan Securities, the gaming industry continues to be in a high prosperity cycle under supply-demand resonance, with the upcoming Q3 reports likely validating this trend. It is believed that this cycle may last longer than market expectations, and the current valuation remains attractive, prompting an increased recommendation for gaming equities.

Of the 159 domestic games approved this month, 73 are in the mobile-casual genre, and 70 are general mobile games. Notable publicly listed products include TENCENT's (00700) "Eight Desolations and Ten Directions," 37 Interactive Entertainment Network Technology Group Co., Ltd.’s (002555.SZ) "Survival for 33 Days," Kingnet Network Co., Ltd. (002517.SZ)’s "Blue Moon Hero," Shenzhen Bingchuan Network Co., Ltd. (300533.SZ)’s "I Want to Be the Ancestor," Shenzhen Zqgame Co., Ltd. (300052.SZ)’s "The Fantasy of Shu Mountain" and "I Am MT: The Glory Defense Team," ARCHOSAUR GAMES (09990)’s "Cloud Dream Journey to the West," and FRIENDTIMES (06820)’s "Firefly Expedition".

In terms of imported games, October saw 7 new titles approved, including Yoozoo Interactive Co., Ltd. (002174.SZ)’s "Crayon Shin-chan." So far this year, the monthly issuance of game licenses has remained stable, with a total of 1441 licenses issued. Including this month, there have been four months this year where the number of licenses exceeded 150. Alongside the approvals, the National Press and Publication Administration updated the gaming approval information for 2025. Perfect World’s flagship title "Tower of Fantasy" has added a PS5 version, while Jiubite’s "Kairo Business Owner" has been renamed to "Kairo Game World." Furthermore, Xuancheng Technology’s basketball mobile game "NBA Peak Showdown" has switched its publishing unit to Datong Publishing Media Company and has added a client version.

The A-share gaming sector has seen noticeable gains this year. According to data from Wind, as of October 22, the Shenwan secondary gaming index has risen about 66% year-to-date, ranking eighth among all secondary industries. Several gaming stocks have doubled in price this year, with Giant Network rising over 210% and Jiubite increasing by over 110%. Additionally, Shenzhen Bingchuan Network Co., Ltd., ST Kaijin, Kingnet Network, and Xinghui Entertainment have all seen gains exceeding 70%. Kaiyuan Securities believes that the gaming industry is still experiencing a high prosperity cycle under supply-demand resonance. The upcoming Q3 reports may further validate the robustness of this cycle, and it is suggested to increase the allocation to gaming stocks after the corrections.

Moreover, according to a recent report from Omdia, total revenue from game subscriptions in the Asia-Pacific region is expected to grow from $6.5 billion in 2025 to $9.4 billion by 2029. Notably, this growth rate significantly exceeds the global average share of the subscription model in content expenditures. CITIC Securities indicated that after a period of self-reflection and external changes from 2021 to 2024, the gaming industry is set to rejuvenate in 2025. In the first half of this year, the domestic self-developed online gaming market size grew by 19% year-on-year. This marks a product innovation cycle measured over years; in the short term, Q3 gaming performance is expected to grow swiftly, while mid-term new product launches are anticipated for the National Day and Spring Festival holiday periods, and in the long run, we will observe how AI enhances emotional companionship games and user-generated content (UGC) platforms.

Relevant concept stocks include: TENCENT (00700): The licensed domestic game includes TENCENT's "Eight Desolations and Ten Directions." In the first half of the year, TENCENT reported revenue of CNY 364.53 billion, a year-on-year increase of 13.7%, with a net profit of CNY 103.45 billion, up 15.6%. The added value service segment (games + social) achieved a revenue of CNY 183.5 billion in the first half, growing by 16.54%, far surpassing the previous year’s 2.54% growth. Domestic game revenues reached CNY 40.4 billion in Q2, up 17%, while overseas game revenues hit CNY 18.8 billion, a 35% year-on-year increase. New products like "Delta Force" and "Dune: Awakening" have driven liquidity and daily active users (DAU), while existing products support ARPU recovery through refined operations.

ARCHOSAUR GAMES (09990): This month’s approved domestic game includes ARCHOSAUR GAMES' "Cloud Dream Journey to the West." In the first half of 2025, ARCHOSAUR reported revenue of CNY 634 million, representing a 44.4% increase from CNY 439 million the previous year. This surge was mainly driven by the launch of two new games, "Dragon Tribe: The Gate of Cassel" and "Walking on the Wind," in the domestic market, as well as the stable performance of their flagship product "Shining with Brilliance."

FRIENDTIMES (06820): The licensed domestic game includes FRIENDTIMES' "Firefly Expedition." FRIENDTIMES reported revenue of CNY 623 million in the first half of 2025, an 18.5% increase year-on-year; during this period, profit reached CNY 40.71 million, a drastic turnaround from a loss of CNY 72.33 million last year, growing by 156.3%. Gross margin increased by 5 percentage points to 73.6%. The performance improvement can be attributed to the success of mobile games "Dulala Promotion Diary" and "Lingyun Promise," along with an increase in the proportion of high-margin revenue.

NETEASE (09999): As of the first half of 2025, NETEASE reported net revenue of CNY 56.72 billion and gross profit of CNY 36.53 billion. The net income from games and related value-added services in Q2 was CNY 22.8 billion, a 13.7% year-on-year increase. Classic games have maintained stable performance, with "Fantasy Westward Journey" mobile game recording the highest quarterly revenue since 2022, "Identity V" ranking in the top five of China’s iOS bestsellers, and "Nirvana in Fire" mobile rising to third in China’s iOS bestsellers.

NETDRAGON (00777): Guotai Junan released a research report stating that NetDragon's gaming business is growing steadily, with the "Moyun" IP series showcasing resilient long-term operational capabilities. The AI production center aids in reducing costs and enhancing game experiences, and the educational technology sector is leading advances abroad, with investments spread across multiple areas. The core gaming business focuses on MMORPGs, with three evergreen IPs (Moyun, Conquer, Spirit of Courage) generating stable cash flow, and Moyun being 100% self-developed IP with a steady growth of monthly active users exceeding 2.5 million.