37 Interactive Entertainment, a Chinese gaming giant, reported a staggering 981.35% year-on-year increase in investment income in Q1 2026, driven by its early bet on Zhipu AI, a large language model (LLM) company that went public in Hong Kong in January 2026, with its stock price soaring from 116 HKD to over 1,000 HKD. But this is just the beginning. On May 15, 2026, 37 Interactive hosted a conference in Wuhu, Anhui, titled 'Reading Technology, Interactive New Life,' bringing together nearly 50 hard-tech companies, including AI chip maker XiWang, brain-computer interface (BCI) unicorn BrainCo, edge GPU cloud service provider Tingyu, embodied AI company Guanglun, and video AI firm Aishi. This is not just a gaming company's network; it's a strategic move to build a tech ecosystem.
Why does this matter? The gaming industry has long suffered from high costs and low efficiency. Developing a AAA game can take 8-10 years, as seen with 'Red Dead Redemption 2' and 'Cyberpunk 2077.' Even 37 Interactive's own 'Douluo Dalu: Soul Master Duel' took nearly two years. By investing in Zhipu's GLM LLM, 37 Interactive has reduced the cost of AI-generated ad materials by over 60%, cutting production time from weeks to hours. Currently, over 70% of its ad materials and 80% of 2D art are AI-assisted. A medium-sized SLG game update that previously required 20 people for two weeks can now be completed by five people in three days. Moreover, 37 Interactive has developed its own LLM, 'Xiaoqi,' which has passed national cybersecurity filings, and has over 400 internal AI agents, achieving over 90% AI coverage in R&D, operations, and publishing.
Beyond Zhipu AI, 37 Interactive has invested in all four major Chinese LLM startups—Zhipu, Moonshot AI (Kimi), Baichuan Intelligent—except MiniMax, which is backed by competitor miHoYo. It also invested in AI chip maker Yizhi Electronics in 2022 (later acquired by Black Sesame Technologies, becoming a key asset in Hong Kong's 'AI chip first stock'), optical module maker Lijing Innovation in 2024 (valued at 22.5 billion yuan post-investment, filed for IPO in Hong Kong), semiconductor equipment company Star Technology in 2025 (led by lithography pioneer He Rongming, focusing on advanced packaging lithography), and BCI unicorn BrainCo with a $20 million investment in November 2025 (which raised another ~2 billion yuan two months later, second only to Musk's Neuralink globally).
Wuhu was chosen strategically: it is a core node of China's 'East Data West Computing' project, with over 26,000 P of computing power (70% of Anhui province). The city offers 'computing vouchers'—a 100 million yuan annual fund subsidizing over 25% of computing costs for enterprises. Since 2021, 37 Interactive has run the '37 Fun Heart Fund' in Wuhu (total 200 million yuan, 120 million yuan deployed), investing in startups like Tingyu and Huixi Intelligence. This shows 37 Interactive is no longer just a gaming company; it's leveraging its resources to build a tech ecosystem.
But what about its core gaming business? In Q1 2026, 37 Interactive reported revenue of 3.72 billion yuan and net profit of 873 million yuan, up 59.02% year-on-year. Its game 'Ragnarok Online: World Journey' topped app store charts in Hong Kong, Macau, and Taiwan. 'Last Asylum: Plague' ranked in the global top 10 mobile revenue growth. Self-developed 'Survival 33 Days' quickly topped charts on WeChat Mini Games, Douyin Mini Games, and TapTap. The company also has a pipeline including 'The Story of a Discharged Prisoner,' 'Dou Po Cang Qiong: Emperor's Path,' and 'Douluo Dalu: Legacy.' This dual-drive strategy—gaming and tech investment—is unique among Chinese gaming firms. Each tech investment is linked to gaming, creating synergies.
Since 2018, 37 Interactive has invested over 4 billion yuan in cutting-edge tech, proving that gaming companies can be precise hunters in hard tech. Chairman Li Weiwei said at the Wuhu conference: 'Wuhu has computing power, policies have subsidies, 37 Interactive has scenarios and sincerity, and you have the most advanced technology and insight.' Building a platform, gathering an ecosystem, and growing together—this is no longer just a gaming company.