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Two of Tencent’s (OTCPK:TCEHY) (OTCPK:TCTZF) studios, Timi and Lightspeed are developing mobile games in the style of viral hit Palworld, aiming to boost the Chinese company’s core business, Bloomberg News reported citing people with knowledge of the matter.
Palworld is filled with mysterious creatures called ‘Pals’ in which the creatures can be tamed and then deployed in battles.
The two studios operate autonomously, but they seem to have found a new formula to find a new Honor of Kings which can boost the company’s growth.
Tencent is eyeing near-term growth via the China release of Nexon’s Dungeon & Fighter Mobile in the coming months, the report added.
Tencent’s revenue from VAS (value-added services) segment in the fourth quarter fell 2% year-over year to RMB69.1B. International Games revenues rose 1% year-over year, but Domestic Games revenues fell 3% for the same period.
The company is facing a price war in the cloud business arena from rivals such as Alibaba (BABA), while the gaming business is seeing competition from NetEase (NTES), whose game Eggy Party has cornered the market for a new genre of party games.
To boost growth Tencent is now incubating several, competing projects to get the best results, the report added.
The new games being developed combine open-world, survival and crafting elements with the nurture of virtual pets.
Lightspeed has shifted developers from existing games into its Palworld-like project. Timi — known for making Call of Duty Mobile — is hiring Unreal Engine programmers, 3D artists and fight designers for its project, as per a job post, which touts a ‘fantasy adventure world with cute pets,’ according to the report.