For companies that focus on the gaming business, the product lifecycle has always been an inescapable proposition. When a number of old games enter maturity or even decline, the flow will fluctuate, and whether new products can take over in a timely manner directly determines whether the company's performance can re-enter the growth path.
For Zupa (09890), the first half of 2026 is at such a critical point in the transition between old and new products. In the first half of 2026, the company recorded net profit of approximately RMB 210 million for the six months ended June 30, 2026, compared to RMB 650 million for the same period in 2025.
According to the company, the decline in profits is mainly affected by two factors: on the one hand, the decline in earnings from the appreciation of financial assets related to the shares of listed companies; on the other hand, some existing domestic games have entered the late stages of their life cycle, which has led to a decline in turnover and a decrease in revenue.
In other words, the pressure on profits this time is not simply due to deterioration in operating efficiency, but also from changes in the return base of investment and phased pressure brought about by natural iterations of game products.
What is particularly noteworthy is that since July, new products such as “Time Hunters: Awakening” and “Hot Blood Rivers: Awakening” have entered the market one after another, and “Hot Blood Rivers: Return” has achieved impressive results in many markets. At the same time, the company has continued to increase investment in the AI industry and AI skits. Therefore, standing at the mid-2026 time point, the real highlight of playtime may not be just this half-year report, but whether new games, overseas markets, and the AI business can jointly push the company out of the product cycle.
Old games have entered a period of adjustment. Can new games open up room for performance restoration?
Judging from the core changes in the 2026 interim results, the main game industry entering the product cycle transition is the most important main line for understanding this performance. For game publishers, the decline in sales of old products itself does not mean that the business model has failed; what really determines the elasticity of performance is whether the new product can take over in a timely manner.
If a new product is in development or has not yet been launched, then the decline in old games will be directly reflected in revenue and profit; once a new product enters the large-scale operation stage, performance may quickly regain momentum for growth.
Therefore, to a large extent, Zangwan's performance in the first half of 2026 occurred exactly in the time window of alternating between old and new products.
According to the Zhitong Finance App, judging from the time point of view, most of the new products currently being promoted by the company are focused on being released in the second half of 2026 and later, so these products failed to generate sufficient revenue growth in the first half of the year to completely hedge against the decline in old games.
In other words, the company's 2026 H1 financial performance actually reflects more the end state of the past product cycle than the full performance of the company's latest product cycle. Because of this, it is easy to make an overly pessimistic judgment if we only see a year-on-year decline in net profit; what we really need to continue to observe is the market performance of the new game after July and whether it can form a continuous product contribution in the next few quarters.
Looking at it now, “Time and Space Hunters: Awakening”, which first entered the market, has sent a positive signal. According to information, the game is based on the classic “Time and Space Hunter” IP and is positioned as a fighting ARPG mobile game. After its launch in July, it quickly topped the iOS free list.
As far as the game is concerned, the importance of this achievement is not only the ranking itself, but also because it proves that classic IP still has strong user appeal even after being re-commercialized.
For a game company that has many years of experience in IP operation, the greatest value of mature IP is that it can reduce the cognitive cost of new products when entering the market, and the first appearance of “Time and Space Hunter: Awakening” provided a good verification for the company to later iterate on products through classic IP.
At the same time, the martial arts MMO mobile game “Hot Blood Rivers: Awakening”, which was developed based on the “Hot Blood River” IP, has also officially started public beta. What is more noteworthy is that the same IP has shown strong commercialization performance in overseas markets.
According to the Zhitong Finance App, “Hot Blood River: Return” released by the company reached the top of the App Store free list in South Korea, obtained simultaneous results on the Google Play, App Store, and LDPlayer free lists in Thailand, and achieved TOP1 in the free list and TOP2 in Taiwan, China, indicating that Cangfan is trying to further extend the value of mature IPs from the domestic market to the international market, and this is also an important path for the company to reduce its dependence on a single market and single product in the future.
Today, overseas distribution is also becoming an important part of the strategy to enjoy new products.
The company is currently promoting the construction of a global game ecosystem through the unified brand Game Lovin, which emphasizes “global distribution+local cultural adaptation”, and combines overseas KOL cultivation and community cooperation to improve the ability of products to penetrate the local market. For game companies, globalization in the true sense of the word is not simply translating domestic products into different languages and then launching them, but rather reoperating according to user preferences, cultural environments, and channel characteristics in different regions.
If Play can replicate its experience in IP operations and domestic distribution to overseas markets, then overseas business is expected to become an important source of revenue growth for new games in the future.
In the longer term, the company's current game reserves are also quite rich. Focusing on Jin Yong's martial arts IP, the company has already prepared classic IPs such as “The Eight Heavenly Dragons”, “The Legend of the Diaojiao Trilogy”. Products such as “The Legend of Heroes” and “The New Legend of Huashan Sword” will be launched one after another.
In addition, the company also has a stock of products such as “Blue Moon Dragon Slayer” and “Dream Warrior”, which have already obtained editions. This means that the core problem the company is currently facing is not insufficient product reserves, but rather how to actually transform reserves into continuous flow through product quality, launch pace, and operational capacity.
Therefore, looking at the 2026 mid-term results for the second half of the year, the logic of being playful is actually very clear: the first half of the year was a concentrated reflection of the pressure brought about by old games entering the latter stage of the life cycle, while the second half of the year entered the intensive release of new products. Among them, the first release of “Time and Space Hunters: Awakening”, the public beta of “Hot Blood Rivers: Awakening”, and the performance of “Hot Blood Rivers: Return” in overseas markets all provided an observation window for the company's subsequent performance restoration.
Whether the company can actually get out of this round of adjustments will ultimately depend on whether these products can transform the popularity of users in the early stages of launch into continuous flow, and further form a stable product cycle of “one product after another”.
From “AI+ games” to AI skits, playful searches for a second growth curve
If the new game determines whether the traditional gaming business can resume growth, then the AI and skit business will determine whether the company can break away from a business model that simply relies on the game life cycle in the future.
Judging from the latest moves in 2026, the layout of AI at the application level has moved from “testing at the application level” to the stage of “industrial investment+internal application+content commercialization”.
One important move is the company's strategic investment in VAST, Beijing Sanqi Wanwu Technology Co., Ltd. The company said the move will further expand its industrial reach in the fields of AI 3D content generation, industrial visualization, etc., and provide new impetus for the group's strategic transformation to “AI+ gaming”.
At the same time, the company has issued HK$468 million zero-interest convertible bonds to raise funds for strategic investment and technological ecosystem layout in the AI industry. From the perspective of capital allocation, the signal is clear: AI is no longer a simple conceptual label for gambling, but is becoming an important direction for the company's future business layout.
More importantly, according to the Zhitong Finance App, the company has not stopped AI at the level of external investment, but has begun to actually embed AI into daily operations. The company's self-built global smart assistant “Fun Shrimps” has been launched. It is based on big language models and multi-modal technology, and is equipped with exclusive AI agents divided by role through an independent AI operating environment, data security isolation mechanism, and enterprise-level AI knowledge base.
At the same time, the company launched the internal skills platform “TW Agent Hub” to provide token credits to employees, encourage employees to create and share AI skills, and promote internal AI applications through AI efficiency improvement and co-creation contests. These actions may not directly generate large-scale revenue in the short term, but their more important significance is to change the way the company produces.
If AI can continue to enter R&D, operation, marketing, customer service, and content production, then for game companies, it may eventually be reflected in improved R&D efficiency, reduced material production costs, and improved user acquisition efficiency.
Furthermore, it is worth mentioning that playtime has begun to further extend AI capabilities to skits. In 2026, the company will set up an AI comic and skit circuit, efficiently generate video content through AI technology, and rely on a self-developed AI delivery system for accurate distribution. It not only produces AI skits, but also further promotes and distributes AI skits, forming a “self-development+spontaneous” business model.
The company also clearly proposed that in the future, it will combine relevant AI skit content with game business materials to reverse empower games with content. What is noteworthy about this layout is that it actually links the content production, user acquisition, advertising, and IP operation capabilities accumulated in the gaming field in the past with new forms of content in the AI era.
One of the core problems in the traditional game business is that customer acquisition costs are getting higher and higher, and AI skits offer another possibility. After lowering the threshold for content production through AI, the company can continuously generate large amounts of content around game IP, characters, and worldview, and then distribute it using its own delivery capabilities.
If some of this content can generate traffic, then this traffic can not only serve the skit itself, but also have the opportunity to be imported in reverse into game products.
As a result, skits are no longer just a new business juxtaposed with games, but may become a new traffic entry point for game IP. For gamers with large reserves of classic IP and game products, the potential value of this model is worth paying attention to.
Looking further, AI skits and games may form a new closed commercial loop: games provide IP and character materials, AI is responsible for reducing content production costs, skits are responsible for acquiring users and expanding IP influence, and the company's original marketing system is responsible for further transforming content traffic into commercial value.
If this model works, the value of AI will not only help companies “save money,” but may also help companies create new traffic and revenue streams. This is particularly important for Gaming, which is currently in the product cycle adjustment stage. It means that the company is trying to gradually shift from simply relying on game flow growth in the past to a comprehensive operating model of “IP+game+content+AI”.
Therefore, a more reasonable understanding of the 2026 mid-term results may be to view them as a shift between the company's old product cycle and the new growth cycle. In the first half of 2026, the decline in old games became a reality; after entering the second half of the year, whether new games can actually take over became the first variable in recovering performance, while whether AI and skits can move from the investment and exploration stage to actual commercialization will determine whether the company's second growth curve can actually be established.
What is worth tracking next will also shift from simply focusing on profit figures in semi-annual reports to observing the sustainability of new traffic, the pace of expansion of overseas markets, and the extent to which AI content commercialization has been implemented. In other words, the first half of 2026 is a period of intense play and pressure, but what really determines the company's valuation space for the next stage is probably the new set of variables “new game+globalization+AI+short drama” that has already begun to appear.