Xsolla’s 2025 Gaming State of Play report reveals optimistic trends

Mobile gaming is thriving, the Asia-Pacific market is experiencing a surge — and so are new opportunities and new markets. In our most recent GamesBeat Live session, Chris Hewish, chief strategy officer at Xsolla, spoke with Dean Takahashi, GameBeat’s Lead Writer, about what game industry leaders can expect in 2025, Xsolla’s recent report — The Gaming Industry State of Play: 2025 and Beyond — and what’s driving greater-than-expected industry growth.

Arguably the biggest trend is the growth of direct-to-consumer (DTC) web shops, driven by a 70% capture rate on off-platform sales, made possible by regulatory changes that free developers from the dependence of traditional app stores.

“This is part of a bigger trend, which is all about putting power in the hands of the consumers and the users,” Hewish said. “Things were locked away previously in platforms and gatekeepers, but now we’re making things easier and giving them more access.”

The changing landscape of game monetization

The value proposition of platforms charging 30% of developers’ revenue has declined, and has become hugely oversaturated, making discoverability a major challenge. Platforms still have their place, but developers are looking for ways to evolve beyond them, and add revenue streams where margins are significantly more favorable, and realizing great success rates, Hewish said.

“We’re seeing a 16% increase in overall revenue for companies that are engaging with these, because it’s not just about the margin,” he explaind. “You’re paying less, you’re connecting directly with your player, and you’re able to understand who that player is.”

Xsolla’s strategy has been about bringing opportunities together, Hewish added, giving studios of every size and even solo developers what they need to succeed in the business side of the game industry. The company is in a unique market position, sitting in the middle of the Venn diagram of payments, platforms and technology. They’re a merchant of record for partners, offering over a thousand different global payment methods, while also offering a number of other solutions. These range from web shops, fast and streamlined ways to launch DTC sales and cloud gaming technology to funding, operational tools, the recently announced loyalty-as-a-service solution, alternative revenue models such as “Play Before You Buy,” and a publishing suite that gives developers a way to scale with marketing.

“There’s really nobody who’s offering everything that we do, and we offer it for free if you work with us,” he said. “We just charge a flat fee.”

Growth trends and industry outlook

The industry saw an unexpected 9% surge in growth in the last three months, driven by industry trends, such as the upcoming release of prestige titles like GTA 6 and excitement around the next generation of the Nintendo Switch, which is expected to boost engagement and spending across the sector. And there are also greater margins for developers launching new monetization strategies.

Industry consolidation

Industry consolidation is creating challenges for independent studios, because larger studio systems create increased competition and market control, but when a larger company takes on a small studio, projects are often better funded, operations get streamlined and that increased competition means better games are getting made. Plus, independent studios are better able to hold their own nowadays with new lower-cost, easy-to-launch monetization strategies.

The changing perspective on cloud gaming

When cloud gaming first emerged, it was touted as a platform in and of itself.

“The reality is cloud gaming is more of a feature, and can be very important to how you connect with your players,” Hewish explained. “What we’re seeing is people looking at cloud gaming as a way to open up the top of their funnel, where they can connect with players anywhere, reach out to an audience all over the world and allow them to try your game before they buy it.”

Cloud gaming eliminates hardware restrictions, reducing the barriers to play and leveling the playing field for developers, who can expand beyond traditional console and PC markets. Plus, allowing players to experience a game before purchasing means higher conversion rates, increased trust and longer retention.

Xsolla’s Cloud Gaming service gives developers the option to offer instant access to games, reducing the friction between discovery and purchase.

Job market growth

Hewish pointed out that growth in the market should also mean growth for gaming jobs, despite industry consolidation, and hopes to see that trend pick up.

“Just personally for me, and I know for our company, we’re big proponents of going direct to the players, putting power into developers’ hands,” he said. “If you’re keeping 20% more of your revenue, some of that’s going to go to marketing, some’s going to building better offerings for your players. But that’s also more money to retain your staff and keep your teams.”