Ninjas in Pyjamas (NIP), formed from the 2021 merger of Sweden’s Ninjas in Pyjamas and China’s ESV5, is seeking to expand into new markets amid slower growth.

The firm, known for its Counter-Strike and League of Legends teams, became China’s first publicly traded esports stock after its Nasdaq listing last year.

For the financial year ending April 2024, NIP reported a net loss of US$12.7 million, an improvement from the previous year’s loss of US$13.3 million. Revenue rose slightly by 1.9% to US$85.7 million.

CEO Hicham Chahine noted better margins and revenue growth as signs of progress towards profitability.

In January, NIP signed a five-year agreement with the Abu Dhabi Investment Office to establish its global headquarters in the UAE capital.

🔗 Source: South China Morning Post

🧠 Food for thought

1️⃣ East-west gaming market structure reflects broader digital ecosystem differences

The contrast Chahine highlights between China’s consolidated “super apps” and the West’s fragmentation reflects fundamental differences in how digital markets have evolved globally.

China’s gaming market developed alongside a broader digital ecosystem dominated by all-in-one platforms, with companies like Tencent holding 44% of the mobile gaming market share in China while operating WeChat and other services1.

This consolidation created efficiency in both user acquisition and monetization, with Chinese gamers showing different payment preferences, favoring SMS payments over credit cards and embracing platforms like Alipay with its 450 million users2.

The Western market’s fragmentation across multiple platforms and devices has created higher acquisition costs and more complex monetization challenges, contributing to the different growth trajectories of gaming companies in each region.

This structural difference explains why NIP, despite its Swedish-Chinese origins, needs different strategies for each market, including maintaining Hong Kong operations as a gateway to mainland China while establishing Middle Eastern headquarters.

2️⃣ Esports organizations pivot to emerging markets amid growth challenges

NIP’s strategic expansion into the Middle East reflects a broader industry trend of esports companies seeking growth in rapidly developing markets as traditional regions show signs of saturation.

The MENA gaming market is now the fastest-growing globally, valued at $500 million and projected to double by 2029, offering fresh opportunities for companies experiencing slowing growth in established markets3.