HONG KONG—The global videogame industry’s biggest player is one whose rapid expansion has gone largely under the radar—even for the most dedicated gamers.

Tencent Holdings Ltd.—one of Asia’s most valuable technology firms, with a market capitalization of roughly $240 billion—has become the world’s largest game publisher by revenue, surpassing better-known U.S. names such as Electronic Arts Inc. and Activision Blizzard Inc. by dominating China’s videogames market and forging strategic alliances with foreign players.

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