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Niko Partners recently released its report on China’s young gamers, showing that many of them have dropped gaming following the country’s stern regulations. However, it also predicts that the numbers will bounce back by 2026.

Last year, China rolled out new regulations that limit the amount of playtime for minors. Specifically, they were reduced to just three hours of playtime a week. According to Niko’s report, this caused a lot of young gamers to drop out of the market entirely. Before these regulations, 60% of young people in China were gamers. Following their rollout, the number has dropped to 40%. According to the report, 77% of young gamers play less thanks to these rules.

However, Niko expects the numbers to rise again as the industry accounts for the new regulations. It predicts the number of young Chinese gamers to go back up to 115 million by 2026, as opposed to 83 million now and 122 million at its peak in 2020. Esports remains almost as popular among the demographic as ever. The report also reveals that it’s common for parents to allow their children to use their IDs to skirt the time limit.

Lisa Hanson, founder and president of Niko Partners, said in a statement, “As soon as Niko Partners learned of the regulation limiting gameplay for youth to three specific hours per week, we knew that it would impact the overall games and esports market in China. The findings of this report reflect the strong impact, but youth gamers remain a vital part of the games market. Gamers, developers, and game publishers will necessarily adjust to the new system in the coming years.”

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