NetEase (9999) Q2 2025 earnings summary

Executive summary

• Net revenues for Q2 2025 reached RMB27.9 billion ($3.9 billion), up 9.4% year-over-year, driven by strong growth in games and related value-added services, with new global game launches and content updates fueling engagement.

• Non-GAAP net income attributable to shareholders was RMB9.5 billion ($1.3 billion), up 22% year-over-year, while net income attributable to shareholders was RMB8.6 billion ($1.2 billion).

• Gross profit for Q2 was RMB18.1 billion ($2.5 billion), up 12.5% year-over-year, with a gross profit margin of 64.7%.

• The board approved a Q2 2025 dividend of $0.1140 per share ($0.5700 per ADS), payable in September 2025.

• Share repurchase program ongoing, with $2 billion spent to repurchase 22.1 million ADSs under a $5 billion program as of June 30, 2025.

Financial highlights

• Games and related value-added services revenue grew 13.7% year-over-year to RMB22.8 billion ($3.2 billion).

• Youdao revenue increased 7.2% year-over-year to RMB1.4 billion ($197.9 million), achieving its first Q2 operating profit.

• NetEase Cloud Music revenue declined 3.5% year-over-year to RMB2.0 billion ($274.8 million), but grew 6% sequentially.

• Innovative businesses and others revenue fell 17.8% year-over-year to RMB1.7 billion ($237.2 million), with Yanxuan leading quarter-over-quarter growth.

• Net cash as of June 30, 2025, was RMB142.1 billion ($19.8 billion), up from RMB131.5 billion at year-end 2024.

Outlook and guidance

• Ongoing investment in content creation, product development, and global expansion, with a focus on high-quality, innovative games and AI integration.

• Several new titles, including The Upraven, Blood Message, Destiny Rising, and Sea of Remnants, are in the pipeline for global launch through 2026.

• Management emphasized scaling original IP and bringing successful domestic games to international markets.

• Global publishing capabilities and overseas market growth remain strategic priorities.