Japan’s mobile game market may be shrinking compared to its COVID era heights, but players’ whaling habits are keeping revenue stable. Sensor Tower published its latest Japan Game Market Insights report on September 10 (via 4Gamer), covering the one-year period between August 2024 and July 2025.
According to the report (which analyzes data from the App Store and Play Store), Japan’s mobile market saw annual downloads (new user acquisition) reach 628 million in the past year, which is a downward trend from 2020. On the other hand, revenue from in-app purchases remained strong, surpassing $11 billion (second only to China at $11.5 billion)
Sensor Tower says that Japan has an “exceptionally high” average revenue per user (ARPU), which means Japanese players are willing to spend a significant amount of money of gacha and other microtransactions. What’s interesting is that more than 80% of downloads of Japanese mobile games actually come from overseas, but nearly 70% of revenue still comes from Japanese players.
Last month, we reported on Japanese mobile game developers comparing the domestic industry to a “sinking Titanic with only a few seats left afloat,” and these new insights seem to match up. While existing hits are succeeding in retaining their players long-term and getting them to continue spending money, declining user acquisition rates mean new titles are struggling to compete.
“Despite a slightly shrinking market, ARPU continues to achieve significant profitability, supported by an enthusiastic player base and efficient monetization strategies,” Sensor Tower notes. According to the report, gacha RPGs seem to be the best at attracting high-spending core players.
On a related note, a survey by Japan’s financial giant SMBC from earlier this year showed that 18.8% of Japanese people in their 20s have at least once experienced spending so much money on in-game purchases that they couldn’t cover their living expenses. This is sadly another bit of information that adds up with the data we’re seeing.
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