Understanding the Market | Game stocks rise broadly, Apple's reduction of App Store commission rates may create a demonstration effect, helping domestic developers increase profit margins

According to Zhitong Finance APP, gaming stocks are generally rising. As of the time of publication, LINEKONG (08267) is up 7.94%, trading at HKD 0.34; BOYAA (00434) is up 5.41%, trading at HKD 3.12; Bilibili-W (09626) is up 3.55%, trading at HKD 210.2; XD INC (02400) is up 3.06%, trading at HKD 74.2; NetEase-W (09999) is up 1.39%, trading at HKD 185.3; Tencent (00700) is up 0.36%, trading at HKD 560.5.

In terms of news, Goldman Sachs' latest research report points out that Apple announced last week a reduction in the commission rate for the App Store in mainland China; meanwhile, Google also announced in early March that the in-app purchase commission rate for the Google Play store will be reduced from 30% to 20% or lower, and will open up third-party payments, allowing developers to use billing systems outside of Google's own. Goldman Sachs believes that the reduction in commission rates by these two companies will lower channel costs for mobile game developers/publishers, help expand their profits, and save costs to increase R&D investment, providing longer development cycles for startup teams/small and medium-sized enterprises, promoting the development of the entire industry, and nurturing more innovative products.

Goldman Sachs further stated that the measures taken by the Google Play store may also pave the way for domestic companies to expand overseas. More importantly, Apple's actions may have a demonstration effect and become an important bargaining chip for game developers to pressure domestic Android channels to implement similar reforms. If domestic Android channels follow Apple's lead in reducing commission rates, there is still room for improvement in the profitability of game publishers/developers