What happened
Yaoji Technology, nicknamed the 'King of Playing Cards,' saw its first-half 2026 results take a hit. The company posted revenue of RMB 1.322 billion, down 8.07% year-on-year; net profit of RMB 216 million, down 15.51%; and net profit excluding non-recurring items of RMB 223 million, a decrease of 12.2%.
Yaoji operates three segments: playing cards, mobile games, and digital marketing. In the first half, playing-card revenue rose 7.23% to RMB 460 million, digital marketing fell 13.52% to RMB 450 million, and mobile games dropped 16.03% to RMB 404 million. These three segments accounted for 34.76%, 30.54%, and 34.04% of total revenue, with gross margins of 30.04%, 88.13%, and 8.69%, respectively. Mobile games, the highest-margin business, was also the one with the steepest decline.
Yaoji said the gaming pullback was within normal fluctuations, but it has also curbed spending. Sales expenses for the first half fell 32.50% year-on-year to RMB 70.9589 million, a trend that has continued since 2022: the figure dropped to RMB 163 million in 2025 from RMB 476 million in 2022, with year-on-year falls of 32.99%, 17.51% and 38.14% between 2023 and 2025. A company representative said heavier investment would not bring suitable returns, while an industry source noted that fishing games, a focus for Yaoji, have an aging audience and that regulators have basically stopped granting new fishing-game licenses after 2018.
Why it matters
The H1 numbers show that Yaoji's most profitable arm is also its biggest drag: mobile games posted an 88.13% gross margin yet saw revenue fall 16.03%, outpacing declines in the lower-margin businesses. That mix helps explain why net profit dropped faster than revenue.
The drop reflects a broader squeeze in the fishing-game category, where legal titles are mostly legacy products because new licenses have effectively stopped since 2018. With an aging player base and diminishing returns on user acquisition, Yaoji has chosen to cut marketing spend rather than chase growth at any cost.
With sales expenses already trimmed for several years, future momentum may have to come from product iteration, small-game expansion, or overseas markets rather than from heavier advertising.
Key facts
Revenue for H1 2026 was RMB 1.322 billion, down 8.07% year-on-year; net profit fell 15.51% to RMB 216 million; net profit excluding non-recurring items dropped 12.2% to RMB 223 million.
Mobile gaming revenue declined 16.03% to RMB 404 million in H1 2026, making it the worst-performing segment; playing cards grew 7.23% to RMB 460 million, and digital marketing slipped 13.52% to RMB 450 million.
Gross margins by segment were 30.04% for playing cards, 88.13% for mobile games, and 8.69% for digital marketing; sales expenses fell 32.50% year-on-year to RMB 70.9589 million.
What to watch next
Overseas expansion: Yaoji said it will prioritize Southeast Asia, the Middle East, Japan/Korea, and Europe/US in 2026, yet first-half overseas revenue fell 10.85% to RMB 91.9793 million. The company is considering self-running overseas operations or finding a stronger third-party publisher, so execution there will be closely watched.
New product pipeline: Yaoji plans to keep iterating its core fishing titles and to broaden revenue with limited fish species, skins, and themed plush toys. It is also targeting mid-to-light small games through internal incubation and external partnerships.
AI use: Yaoji has mentioned AI-driven technology as one of its strategic pillars, but for now it says AI is mainly a productivity tool to improve efficiency and cut labor costs, not a feature built into games. Watch whether that approach changes.