Summary of Key Points
In 2026, Huya achieved significant growth in its gaming business thanks to the hit game "Goose and Duck Kill" (with quarterly gaming-related revenue exceeding 600 million yuan and a narrowing loss). However, due to its affiliation with Tencent, a giant company, its achievements seem insignificant within Tencent's ecosystem. Additionally, Huya holds a large amount of cash on its balance sheet—more valuable than its actual business operations—which has labeled it a "stub stock," similar to He Youjun's esports company, which, no matter how well it performs, is still considered less significant in the context of the gambling tycoon's family.
I. How Powerful Is "Goose and Duck Kill"? It Dominates Huya's Financial Reports
"Goose and Duck Kill" has truly become Huya's saving grace. The game topped the iOS app charts multiple times in 2026, dominating Huya's financial reports:
- Gaming-related revenue increased by 69.4% year-over-year to 627 million yuan in the first quarter, accounting for 36.3% of total revenue; it continued to grow by 54.1% in the second quarter to 638 million yuan, and the operating loss was reduced from 23.7 million yuan to 7 million yuan.
- To promote the game, Huya increased its marketing expenses by 45.1% in the first quarter and another 57.7% to 91 million yuan in the second quarter.
For a company like Huya, which previously operated conservatively in the live streaming industry, having such a hit game is like a turning point from underperforming to thriving.
II. In Front of Tencent, "Goose and Duck Kill's" Achievements Are Considered Minor
However, Huya is a subsidiary of Tencent (with its current chairman being a senior executive at Tencent). Its success must be assessed within the context of Tencent's overall business:
- Tencent's quarterly gaming revenue alone amounts to 40-50 billion yuan, with individual games like "Honor of Kings" and "Peace Elite" generating over 4 billion yuan in annual revenue. In comparison, "Goose and Duck Kill's" revenue is just a fraction of this.
- Tencent's newly launched game "Kingdom of Rock World" generates more revenue and receives more attention than "Goose and Duck Kill."
It's like He Youjun's company having a market value that only covers a quarter of the cost of a house in his family—impressive to outsiders but insignificant within the family context.
III. Huya Aspires to Be a Promotion Partner for Tencent, But Its Capabilities Are Limited
Tencent acquired Huya with the intention of using it as a platform for game promotion and organizing esports events to complement its gaming empire. However, Huya's capacity is limited:
- Huya's total revenue from games and advertising in one quarter is just over 600 million yuan, while Tencent spends 1.4 billion yuan on the initial promotion of a new game like "Dream Star" and 11 billion yuan on advertising expenses in that same quarter.
- With its limited user base and usage time, Huya has limited ad opportunities. Tencent, with its own platforms (WeChat Moments, Video Accounts, Mini Programs), can easily access additional traffic without relying on Huya's resources.
Therefore, Huya's strategic value is not considered high by Tencent.
IV. Excess Cash on the Balance Sheet Makes Huya a "Rich Second Generation That Relys on Parents"
Another issue for Huya is its large amount of cash. Live streaming was once a booming industry, and Tencent invested heavily in it (460 million US dollars in Series B financing, 200 million US dollars in IPO, 500 million yuan in additional fundraising, and another 260 million yuan later). Yet Huya's current market value is only 540 million US dollars, with cash on its balance sheet being more valuable than its business operations, making it a "stub stock."
After taking over, Tencent distributed substantial dividends to Huya (400 million US dollars in 2024) to recoup its investment. For Huya, this money could have been used for new initiatives; now that it has been distributed, it feels like a sign of being undervalued—similar to someone with 100 million yuan from demolition compensation receiving criticism for having a low monthly salary.
V. The Common Struggle of "Rich Second Generations": No Matter How Successful, They Can't Escape the Shadow of the Family
Whether it's He Youjun's esports company or Huya's "Goose and Duck Kill," their success is overshadowed by their affiliation with larger entities (the He family/Tencent). These companies are successful on their own, but within the context of these conglomerates, they appear insignificant.
This news article uses the metaphor of "rich second generations" to illustrate a business phenomenon: the success of smaller companies may be negligible in front of larger corporations, and the resources of large companies can sometimes become a constraint for them. While outsiders see Huya as impressive, it is just one piece in Tencent's larger puzzle—a stark reality.