Downloads rose steadily from Q1 2017 to Q4 2019, reaching around 30 billion, before jumping sharply to around 39 billion at the peak in Q1 2020. Since then downloads have fallen, hovering between approximately 35 and 37 billion, standing at approximately 35 billion in Q4 2022.
2022 saw India and the US leading global installs, alongside emerging markets such as Brazil and Indonesia. China, despite being the world’s largest mobile-first market, isn’t named as one of the biggest regions for downloads, due in part to a slow reopening following Covid and a crackdown on the country’s tech sector. However, Sensor Tower notes that China is poised to resurge following the issue of new licenses and help drive growth in the future following the easing of restrictions.
China is also due to see a rise in consumer spending, with mobile spending reaching a record high of $540 million in January 2023, an increase of $29 million from January 2022. While mobile spending in China is increasing, it isn’t doing so as quickly as the pre-Covid period. However, Sensor Tower notes that Chinese consumers have a historically high level of savings, which represents significant monetisation opportunities for app developers in the coming months.
Mobile gaming is leading the way
Mobile gaming remains the top app category by downloads. While installs for the category remained relatively flat year-on-year in 2022, they stood 19 billion above pre-pandemic figures. Games were the number one app category in the majority of global markets for the year, with only some African countries, such as Kenya and Nigeria, bucking the trend.
However, Sensor Tower notes that the increase in smartphone ownership and improvements in economic ecosystems and internet penetration will make Africa an important region for game developers in coming years, with African countries expected to rise in the download rankings in the future.
Sensor Tower reports that mobile gaming generated $79 billion in revenue, making it far and away the most profitable app category, with entertainment apps coming in a distant second place at $12 billion.
Despite this, 2022 saw the games market decline for the first time, with the company reporting industry revenue of $86 billion in 2021. This is attributed to numerous global factors, such as the normalisation of the market following the pandemic and the war in Ukraine.
Japan saw the largest decrease in revenue, falling $960 million in Q4 2022 compared to the same period in 2021. Sensor Tower identifies several key factors in this, including a late Covid reopening, the World Cup, and an unprecedented rise in inflation.
Revenue also declined in other key markets, including market leaders such as the United States, and China. Spending decreased across the entire game category however some apps, such as Lineage W, Diablo Immortal, and Royal Match, reported gross revenue growth in excess of $300 million.
Despite these declines, emerging markets such as India, Brazil, and Turkiye were among the fastest-growing game markets. However, Sensor Tower notes that these increases aren’t enough to offset the decline in major markets.
In December, Newzoo released its own predictions for 2023.