Highlights
- Global mobile gaming in-app purchase revenue dropped 2% to $40 billion, while new game downloads fell 12% to 24B in the first half of 2026.
- To counteract slowing player spending, publishers increased digital gaming ad spend by 8% to $7B, pushing ad impressions up 14% to 1.4T.
- While Tencent remained the overall market leader, Century Games surged significantly with a 45% increase in in-app purchase revenue to capture second place globally
The mobile gaming landscape is shifting beneath our fingers. In the first half of 2026, the industry saw a noticeable cool-down in both downloads and player spending. But publishers aren't taking the hit quietly; to balance the books, they are flooding our screens with more advertisements than ever before. According to Sensor Tower's H1 2026 Gaming Digital Market Index, worldwide mobile in-app purchase (IAP) revenue dipped by 2% year-over-year, landing at $40 billion USD. That slight dip in spending was paired with a much sharper 12% drop in new game downloads, which fell to 24B installs globally.
Digital gaming ad spend surged by 8% to hit a massive $7B, pushing ad impressions up 14% to a staggering 1.4T. When it comes to the games themselves, Tencent’s Honor of Kings reclaimed the global number one spot for in-app purchases. Interestingly, this wasn't due to a massive surge in new spending, but rather a reshuffle at the top of the charts. The mobile giant pulled in $1.1B, even though that represented a 2% drop from the previous year.
It was followed closely by Last War: Survival at $977M and Whiteout Survival at $918M, both of which saw revenue drops of around 16%. Meanwhile, new challengers are rising fast. Gossip Harbor and Kingshot broke into the top 10 on triple-digit growth, aggressively displacing heavyweights like Roblox and Pokémon TCG Pocket.
Century Games Closes the Gap on Tencent in H1 2026 Mobile Revenue
On the player volume side, Block Blast, Free Fire, and Roblox led the pack for downloads. Roblox also led in average monthly active users (MAU), followed by Free Fire and Block Blast. Uniquely, Candy Crush Saga was the only title to crack the top 10 lists for both in-app purchases and overall downloads, proving the timeless appeal of matching candies.
Behind the scenes, the corporate battlefield is just as competitive. Tencent remains the undisputed king of both downloads and revenue. However, Century Games is making serious waves. The publisher climbed from fourth to second place globally after watching its IAP revenue surge by a massive 45%, narrowing Tencent's once-commanding lead significantly. Overall, eight publishers cleared the $1B mark this half. Companies like Microfun and Omnilojo doubled their revenue to break into the top tiers, while former titans like Roblox and miHoYo faced steep declines of 29% and 24%, respectively, as per Pocketgamer.biz.
The battle of the genres is also tightening. Strategy games are still the undisputed top earners, bringing in $9.3B. But casual gaming is catching up fast. The Puzzle genre generated $8.1B thanks to a nearly 20% increase in revenue, rapidly closing the gap with Strategy titles. Despite these massive earnings, Simulation games actually commanded the most player attention, leading playtime with 44.1B hours.
The divide between who downloads and who pays is stark: Action and Strategy games accounted for 49% of all revenue despite making up just 17% of downloads, whereas Lifestyle and Puzzle games drove 74% of installs and 53% of playtime for only 34% of player spend.
Roblox
How Ads vs. IAPs Drive Revenue Globally
Advertising strategies are heavily dictating this new landscape. Puzzle games lead global ad spending at 33%, dominating western markets like the US, UK, Canada, and much of Europe. Conversely, Strategy games lead ad spend in eastern markets like Japan, Korea, Taiwan, and Singapore. YouTube has quickly emerged as the fastest-growing major ad channel, capturing over 16% of mobile ad spend, though it still trails behind in-app mobile ads at 54.8%.
This reliance on advertising is highly regional. In developing markets like India, Indonesia, and Brazil, ad revenue is the lifeblood of the industry, making up 55% to 70% of total earnings. Meanwhile, mature markets like the US, Canada, South Korea, and Japan still rely on direct in-app purchases for up to 90% of their revenue.
Looking at the broader global economy, the US remains the top country for IAP revenue, followed by China, Japan, and South Korea. However, spending has softened in the US by 7%, alongside 10% drops in both Japan and Korea. Europe proved to be a rare bright spot for spending, with in-app purchases rising 10%, driven largely by gamers in Germany, the UK, and France.
Finally, as we look ahead to the rest of the decade, the types of games we enjoy are changing. Mid-core games, once the largest mobile product model, are continuing to lose ground from their early-decade peak. Casual titles are stable, but hybrid casual games are emerging as the mobile market's new growth engine.
