Mobile gaming remains a gold mine in 2024
Without a doubt, mobile games are still extremely profitable. The global gaming market is projected to generate $197 billion in 2022 revenue according to Newzoo – and already over half of this figure comes from mobile gaming alone, at a staggering $93 billion. With projections estimating 11.7% year-over-year growth leading the mobile games market value to reach $116 billion by 2024, there is no sign that mobile gaming‘s profitability is slowing down.
An unstoppable force propelling profits
It’s an understatement to say mobile technology has been advancing at a blazing pace. Current iPhone 14 Pro models now match the RAM in last-gen gaming consoles with up to 16GB, able to play graphically rich titles like Genshin Impact smoothly at 60 FPS. Compare this to the Nintendo Switch at just 4GB RAM. Android phones have similarly closed the hardware gap. With 5G connectivity rolling out globally over the next few years, on-the-go gaming will only get closer to matching the quality possible from dedicated home consoles tied to the TV.
Combine this unmatched access to 3 billion current smartphone owners worldwide – far exceeding the addressable markets for PlayStation, Xbox, and even gaming PCs which remain confined to a more hardcore niche – and you have the ingredients for astronomical profitability. Mobile gaming now accounts for over 52% of games industry revenue, more than PC and console markets combined. In 2021, an incredible $133 billion was spent via in-app purchases across both iOS and Android stores according to SensorTower data. This figure was up 19.7% year-over-year,说明 the spending power of mobile gamers isn’t going away.
Below is a breakdown of the top 3 highest grossing global mobile games, fueled predominantly by in-app purchase revenue:
| Game | Publisher | 2022 Revenue | % from IAP |
|---|---|---|---|
| Honor of Kings | Tencent | $2.28B | ~95% |
| Genshin Impact | miHoYo | $1.56B | ~98% |
| Coin Master | Moon Active | $1.31B | ~100% |
With certain mobile titles generating over $6 million daily from virtual goods and currency, it’s easy to see how publishers like Tencent, Activision Blizzard, and others are able to reap incredible profit margins over 80% on their mobile catalog.
Mobile obliterates other platforms financially
Mobile gaming‘s revenue crush lead over console and PC continues to widen. According to Activision Blizzard‘s 2021 annual report, their mobile platform delivered over 50% of total gaming revenues. Contrast this to just 27% from console and 23% from PC. Industry-wide, the gap is similar – Sensor Tower found in 2022 that mobile gaming grew 12.6% year-over-year, significantly outpacing the 2.7% growth rate of console gaming revenues.
The chart below illustrates the platform revenue shares shift further towards mobile in recent years:
Diving deeper into the leading mobile publishers worldwide by revenue shows how massive and profitable these Apple and Google app store gaming operations have become:
- Tencent Games: $13B+ in annual mobile gaming revenue
- NetEase: $7.7B+ in annual mobile gaming revenue
- Activision Blizzard‘s King division: $2.58B in mobile revenue
- Bandai Namco: $959M in mobile gaming revenue
- Garena/Sea Limited: $922M
All of these publishers focus heavily or exclusively on free-to-play mobile titles compared to premium console formats. The sheer size of the addressable casual smartphone gaming audience allows them to monetize what a dedicated but smaller console/PC fanbase cannot match financially.
Overcoming discoverability challenges
Indeed, launching a runaway mobile gaming success has gotten harder given the over 1 million apps flooding iOS and Android stores today. Even big publishers like Activision Blizzard warn of rising user acquisition costs to stand out. However, for gaming and entertainment mobile apps in general, research by Adjust found retention rates increasing 9% annually. This shows consumers actively want more gaming content – it just has to be creative and engaging enough to not get quickly discarded.
Moreover, the worldwide mobile user base still has so much headroom to grow, especially in emerging markets like India, Latin America, Southeast Asia and MENA regions undersupplied today with app store games. The right product/market fit targeting these next big opportunities outside already saturated countries can circumvent prohibitively expensive paid ads. Offer the next billion mobile gamers something viral and addictive enough, and world-changing profits follow.
Finally, major gaming franchises like Call of Duty Mobile with millions of eager fans guarantee a highly profitable built-in audience as soon as they launch. No matter how crowded app stores become, big shot IP and sequels can easily market themselves sufficiently via their brand recognition alone. Worth established followers, rising user acquisition expenses can be shrugged off.
The final verdict: higher revenues than ever
In summary – yes, mobile games remain tremendously profitable even in a jam-packed app ecosystem thanks continuing technological and monetization innovation combined with immense global demand still adding hundreds of millions of new smartphone owners annually. Publishers who strategically assess market gaps complementary to their game design strengths are primed to capitalize on this $100+ billion industry getting bigger every year. The barriers blocking mobile gaming‘s standardized profit margins above 80% show no evidence of arriving until phones become obsolete – which won‘t be happening anytime remotely soon.
