People walk past the image of the ‘Monkey King’ character, or ‘Sun Wukong’ of Chinese action role-playing game ‘Black Myth: Wukong’, developed by Chinese video game company Game Science, during its launch day in Hangzhou, in eastern China’s Zhejiang province on August 20, 2024.
Str | Afp | Getty Images
BEIJING – China’s first attempt at a top-tier video game has smashed world records, bolstering the industry’s global ambitions just a few years after Beijing’s gaming crackdown.
Black Myth: Wukong, an action game set in mythological China, sold more than 10 million units three days after its launch on Aug. 20. Ten days later, the title still ranked second by revenue in the U.S., and No. 1 globally, according to the Steam video game platform where it sells for around $60 or more.
“I think the next triple-A game is likely very close, because Black Myth: Wukong has shown everyone that a China-made AAA game can reach such high global sales,” said Dino Ying, chairman of Hero Games, which co-published the game and was an early investor in its developer Game Science. That’s according to a CNBC translation of his Mandarin-language remarks in an exclusive interview Thursday.
Ying said he knew of at least one such game under development, which his business partner at Hero Games has invested in. But he declined to share a timeframe.
As for how well Black Myth: Wukong has done, Ying only said sales have since increased by “much more” than the 10 million unit figure, although he indicated it had not yet doubled.
He said that in the future, the company’s game releases will have a global strategy from the start. He also expects foreign AAA game developers to realize how large China’s market is and tailor more features to Chinese players.
AAA games generally refer to titles with high graphics quality and significant marketing. That’s meant such video games have tended to come from companies such as Nintendo, Ubisoft and Electronic Arts.
“China is a big country. We’re talking about 1 million concurrent players,” said Ivan Su, senior equity analyst at Morningstar. “China has 600 million gamers.”
He said the reason why China hasn’t previously developed its own AAA game, which are typically played on computers and consoles, is the years-long production time. “It’s much more cost-effective if you create mobile games,” Su said.
Apple’s Tim Cook visited Hero Games
When Hero Games first invested in Game Science, Apple CEO Tim Cook visited in 2017 and was so impressed by the first game, Art of War: Red Tides, he gave it the front page of the iOS App store in 178 countries, Ying said.
But that wasn’t a commercial success.
Apple CEO Tim Cook visited the office of Hero Games in 2017 after it invested in Game Science, which went on to develop Black Myth: Wukong.
Hero Games
Hero Games had already spent three years investing 60 million yuan (about $8.5 million today) in two failed projects from Game Science when the developer approached Ying and his team in August 2020 about Black Myth: Wukong, he said.
“We’re very lucky, we didn’t give up on Game Science before it succeeded,” Ying said, noting his business partner Daniel Wu, now CEO of Hero Games, had first discovered the startup.
“We aren’t saying to blindly wait for all people,” he said. “When you see that kind of talent, you need to be confident that that talent has been underappreciated. It may not have found the right direction. [So you just need to] help it to find it.”
‘Best game that I have seen’
Two days before Game Science planned to release a promotional video for Black Myth: Wukong, the company showed it to Ying and asked his team for at least 100 million yuan more, he said. If not, he said the startup planned to ask Bilibili, a major Chinese video streaming and game platform.
After watching the video, Ying said he told his team that “I really don’t want to miss this opportunity because this is the best game that I have seen in my life.”
Tencent then bought a 5% stake, but said it would not interfere with Game Science’s plans, Ying said. “Because this was an AAA game, under the normal process of a big business, there was no way it would have been approved.”
Hero Games’ initial investment in Game Science was for a 20% stake.
Beijing has only in the last two years started to approve games, after suspending new titles and limiting how many hours minors could play in 2021.
Black Myth: Wukong got China’s government approval in February. No part of the game needed to be changed for it to pass, Ying said.
“Personally I think in the past two years the regulation is increasingly respectful of the game industry and is beneficial to its development,” Ying said, noting that one or two years ago, there “was a misunderstanding.”
Massive market potential
In the first half of this year, domestic game sales in China reached 147.27 billion yuan, said Ashley Dudarenok, founder of China digital consultancy ChoZan, citing industry figures.
Ying pointed out that many people in China bought PlayStations or upgraded their graphics cards after Black Myth: Wukong’s release, similar to how many people first bought the Nintendo Switch because of Zelda.
Something that’s lasted 1,000 years, people will definitely like it
Dino Ying
Hero Games, chairman
As for the global market, Dudarenok said overseas sales of China-developed games rose to $16.4 billion in 2023, up from $11.6 billion in 2019.
“Chinese games often incorporate rich cultural elements that appeal more and more to a global audience,” she said. “This unique cultural flavor sets them apart from games developed in other regions”
Ying said he expects China has at least five to 10 other stories that have been passed down over the last millennia that can be turned into games.
“If I create a new thing, I don’t know if people will like it. But something that’s lasted 1,000 years, people will definitely like it,” Ying said. “We don’t know why it was preserved over so many years. But we just need to respect the [original] artisans.”
He said Game Science sent teams and equipment to ancient temples in China to scan and replicate the designs, boosting the game’s immersive feel.
Indie Chinese games
In the more niche market of independent games, Chinese companies are also on the rise.
Shanghai-based Cotton Game, which has a staff of 70 people, won the 2024 award for best development team in indie games from the French-supported Game Connection organization and ChinaJoy, which runs a major annual game conference in China.
“It depends on how capable we are, but [we hope to] use games as a way to share art, philosophy and thoughtful content,” the company’s CEO, who goes by the English name Cotton Guo, said in Mandarin translated by CNBC.
Cotton Game’s Sunset Hills – which took five years to draw by hand – also won the “Game of the Year” and “Best Indie Game” awards. The $20 game launched on Aug. 21 on Steam after raising $13,000 on Kickstarter.
The game follows an anthropomorphic dog through a Europe-like village, accompanied by the sounds of nature and music. Players solve puzzles along the way.
“Everyone is quite tired. In society today, the speed of life is very fast,” Robin Luo, the manager of Sunset Games. Its main character is based on his own dog. “So my hope while making Sunset Hills was that everyone playing the game could [find it] refreshing.”
Chinese national flags flutter on boats near shipping containers at the Yangshan Port outside Shanghai, China, February 7, 2025.
Go Nakamura | Reuters
BEIJING — China’s reaction to new U.S. tariffs will likely focus on domestic stimulus and strengthening ties with trading partners, according to analysts based in Greater China.
Hours after U.S. President Donald Trump announced additional 34% tariffs on China, the Chinese Ministry of Commerce called on the U.S. to cancel the tariffs, and vowed unspecified countermeasures. The sweeping U.S. policy also slapped new duties on the European Union and major Asian countries.
Chinese exports to the U.S. this year had already been hit by 20% in additional tariffs, raising the total rate on shipments from China to 54%, among the highest levied by the Trump administration. The effective rate for individual product lines can vary.
But, as has been the case, the closing line of the Chinese statement was a call to negotiate.
“I think the focus of China’s response in the near term won’t be retaliatory tariffs or such measures,” said Bruce Pang, adjunct associate professor at CUHK Business School. That’s according to a CNBC translation of the Chinese-language statement.
Instead, Pang expects China to focus on improving its own economy by diversifying export destinations and products, as well as doubling down on its priority of boosting domestic consumption.
China, the world’s second-largest economy, has since September stepped up stimulus efforts by expanding the fiscal deficit, increasing a consumption trade-in subsidy program and calling for a halt in the real estate slump. Notably, Chinese President Xi Jinping held a rare meeting with tech entrepreneurs including Alibaba founder Jack Ma in February, in a show of support for the private sector.
The policy reversal — from regulatory tightening in recent years — reflects how Beijing has been “anticipating the coming slowdown or even crash in exports,” Macquarie’s Chief China Economist Larry Hu said in a report, ahead of Trump’s latest tariff announcement. He pointed out that the pandemic-induced export boom of 2021 enabled Beijingto “launch a massive regulatory campaign.”
“My view stays the same,” Hu said in an email Thursday. “Beijing will use domestic stimulus to offset the impact of tariffs, so that they could still achieve the growth target of ‘around 5%.'”
Instead of retaliatory tariffs, Hu also expects Beijing will focus on still using blacklists, export controls on critical minerals and probes into foreign companies in China. Hu also anticipates China will keep the yuan strong against the U.S. dollar and resist calls from retailers to cut prices — as a way to push inflationary pressure onto the U.S.
China’s top leaders in early March announced they would pursue a target of around 5% growth in gross domestic product this year, a task they emphasized would require “very arduous work” to achieve. The finance ministry also hinted it could increase fiscal support if needed.
About 20% of China’s economy relies on exports, according to Goldman Sachs. They previously estimated that new U.S. tariffs of around 60% on China would lower real GDP by around 2 percentage points. The firm still maintains a full-year forecast of 4.5% GDP growth.
Changing global trade
What’s different from the impact of tariffs under Trump’s first term is that China is not the only target, but one of a swath of countries facing hefty levies on their exports to the U.S. Some of these countries, such as Vietnam and Thailand, had served as alternate routes for Chinese goods to reach the U.S.
At the Chinese export hub of Yiwu on Thursday, businesses seemed nonchalant about the impact of the new U.S. tariffs, due to a perception theiroverseas competitors wouldn’t gain an advantage, said Cameron Johnson, a Shanghai-based senior partner at consulting firm Tidalwave Solutions.
He pointed out that previously, the U.S. had focused its trade measures on forcing companies to remove China from their supply chains and go to other countries. But Chinese manufacturers had expanded overseas alongside that diversification, he said.
“The reality is this [new U.S. tariff policy] essentially gives most of Asia and Africa to China, and the U.S. is not prepared,” Johnson said. He expects China won’t make things unnecessarily difficult for U.S. businesses operating in the country and instead will try harder to build other trade relationships.
Since Trump’s first four-year term ended in early 2021, China has increased its trade with Southeast Asia so much that the region is now Beijing’s largest trading partner, followed by the European Union and then the U.S.
The 10 member states of the Association of Southeast Asian Nations (ASEAN) joined China, Japan, South Korea, Australia and New Zealand in forming the world’s largest free trade bloc — the Regional Comprehensive Economic Partnership (RCEP) — which came into being in early 2022. The U.S. and India are not members of the RCEP.
“RCEP member countries will naturally deepen trade ties with one another,” Yue Su, principal economist, China, at the Economist Intelligence Unit, said in a note Thursday.
“This is also partly because China’s economy is likely to remain the most — or at least among the most—stable in relative terms, given the government’s strong commitment to its growth targets and its readiness to deploy fiscal policy measures when needed,” she said.
Uncertainties remain
The extent to which all countries will be slapped with tariffs this week remains uncertain as Trump is widely expected to use the duties as a negotiating tactic, especially with China.
“Unlike some of the optimistic market forecasts, we do not expect a US-China bilateral grand bargain,” Ting Lu, chief China economist at Nomura, said in a note Thursday.
“We expect tensions between these two mega economies to worsen significantly,” he said, “especially as China has been making large strides in high-tech sectors, including AI and robotics.”
Check out the companies making headlines in midday trading. Lululemon – The athleisure company saw shares plunging more than 11% after President Donald Trump’s imposition of tariffs on countries where the firm imports a big portion of its products. In 2024, Lululemon sourced 40% of its products from Vietnam, which was hit by a 46% tariff by the administration. Almost 90% of Lululemon’s products are made in Vietnam, Cambodia, Sri Lanka, Indonesia and Bangladesh. Deckers Outdoor – Shares of the footwear company plunged more than 14% following Trump’s reciprocal tariffs rollout. The Ugg maker has 68 supply chain partners in Vietnam and 125 suppliers in China. Nike – The athletic apparel stock declined 12.1% following the Trump administration’s wide-ranging tariffs upon major trading partners. Nike manufactures roughly half its footwear in China and Vietnam, which will be subject to tariff rates of 54% and 46%, respectively. Discount retail stocks – Shares of Five Below and Dollar Tree shed more than 27% and 9%, respectively, on the heels of the new reciprocal tariff announcement. Both companies are big sellers of imported goods, and Dollar Tree CEO Michael Creedon has said that the company might increase prices to offset the tariff impact. Bank stocks – Shares of several banks Bank stocks pulled back as traders reckoned with the potential economic fallout of Trump’s tariff policy. Shares of Goldman Sachs and Morgan Stanley each slid nearly 8%, while JPMorgan Chase , Bank of America and Citi fell more than 5%, 9% and 10%, respectively. Ford – The automaker’s stock declined nearly 4%. On Thursday, Ford announced that it’s offering employee pricing to all customers on multiple models in a program called “From America for America.” Trump’s 25% tariffs on imported vehicles went into effect Thursday. Big Tech stocks — Shares of mega-cap technology names plummeted amid investor concerns that the businesses will face pressures from Trump’s tariffs. Tesla declined nearly 5%, while shares of Amazon and Apple fell more than 7% and 8%, respectively. Alphabet shares also moved more than 3% lower. Semiconductor stocks – Shares of chipmakers also took a hit after the tariff announcement, even after the White House said that semiconductors wouldn’t be subject to the new levies. Shares of Nvidia and Advanced Micro Devices both fell more than 6%, while Broadcom declined more than 8% and Qualcomm slumped more than 9%. Microsoft – Shares shed about 3% after Bloomberg, citing people familiar with the matter, reported that the company is scaling back its data center projects around the world. RH – The luxury home furnisher nosedived 43.5%, on track for its worst day on record after fourth-quarter earnings and forward guidance came in weaker than expected. RH earned $1.58 per share, excluding items, on $812 million in revenue, while analysts polled by LSEG penciled in $1.92 per share and $830 million in revenue. CEO Gary Friedman told analysts that the company was operating within the ” worst housing market in almost 50 years .” Wayfair – Shares tumbled 25% on the back of Trump’s newly announced tariffs, with countries such as Vietnam, Thailand, Cambodia and the Philippines all receiving higher tariffs than the baseline 10%. During a February earnings call, Wayfair CEO Niraj Shah said that these aforementioned nations “have grown as places where folks have factories and where our goods are coming from.” Lyft – The ride-sharing stock dropped more than 9% after receiving a double downgrade to underperform from buy at Bank of America, citing increasing headwinds from autonomous vehicles. Lamb Weston – Shares gained more than 9% after the food processing company posted better-than-expected third-quarter results. Lamb Weston reported adjusted earnings of $1.10 per share on $1.52 billion in revenue, while analysts polled by FactSet were expecting 86 cents per share on $1.49 billion in revenue. — CNBC’s Alex Harring, Hakyung Kim, Yun Li and Lisa Kailai Han contributed reporting.
Check out the companies making headlines before the bell. Lululemon – Shares tumbled more than 12% on the heels of President Donald Trump’s new wide-ranging tariffs . According to an SEC filing , the company sourced 40% of its products from Vietnam in 2024 – a country that was slammed with a 46% tariff. Almost 90% of Lululemon’s products are made in Vietnam, Cambodia, Sri Lanka, Indonesia and Bangladesh. Nike — Shares slumped about 9% after the United States lifted tariffs Wednesday. Nike manufactures roughly half its footwear in China and Vietnam, which will be subject to tariff rates of 54% and 46%, respectively. Discount retailers — Dollar Tree and Five Below tumbled more than 10% and 15%, respectively. Dollar Tree CEO Michael Creedon previously said the company may raise prices on items to offset the impact of new U.S. tariffs. The two companies are big sellers of imported goods. Ford — The automaker slipped 2.3%. Reuters reported that Ford will offer employee pricing to all customers on multiple models to absorb tariff costs, in a program called “From America for America.” Big Tech — Shares of mega-cap technology companies such as Nvidia fell as investors worried that the businesses will come under pressure from President Donald Trump’s new tariff regime. Nvidia dropped more than 5%, as did Tesla . Shares of Amazon.com slid more than 6%. Apple declined by more than 7%. Microsoft — The tech stock declined 2.3%. Bloomberg released another report stating that the XBox and Windows company is scaling back data center projects in the U.S. and overseas. JPMorgan , Citi , Goldman Sachs , Morgan Stanley — Bank stocks retreated sharply early Thursday as investors weighed the economic fallout of Trump’s tariff policy. Shares of JPMorgan Chase were down 3.8%, while Citi, Goldman Sachs and Morgan Stanley all slid more than 4%. RH — The luxury home furnisher plunged 28% after posting weaker fiscal fourth-quarter earnings and first-quarter guidance than Wall Street had estimated. RH earned $1.58 per share, excluding one-time items, on $812 million in revenue in the fourth quarter, while analysts polled by LSEG had penciled in $1.92 per share and $830 million in revenue. CEO Gary Friedman acknowledged to analysts that the company was operating in the “worst housing market in almost 50 years.” Deckers Outdoor — The footwear company that makes Ugg boots sold off more than 12% after the Trump administration’s reciprocal tariffs rollout. Deckers has 68 supply chain partners in Vietnam and 125 suppliers in China. Wayfair — The furniture retailer weakened about 12% on the back of higher U.S. tariffs on goods from Cambodia, Vietnam, Thailand and the Philippines. CEO Niraj Shah said during an earnings call in February that the countries “have grown as places where folks have factories and where our goods are coming from.” — CNBC’s Alex Harring, Jesse Pound, Sarah Min and Sean Conlon contributed reporting