NetEase (9999) Q3 2024 earnings summary

Executive summary

• Net revenues for Q3 2024 were RMB 26.2 billion (US$3.7 billion), up 3% quarter-over-quarter but down 3.9% year-over-year, with strong performance in gaming and digital content.

• Net income attributable to shareholders was RMB 6.5 billion (US$931.7 million), with non-GAAP net income at RMB 7.5 billion (US$1.1 billion).

• PC games revenue grew 29% year-over-year and 30% quarter-over-quarter, driven by titles like World of Warcraft and Naraka: Bladepoint.

• Notable engagement and revenue records set by Identity V, Westward Journey Online II, and Naraka: Bladepoint Mobile.

• Expansion into international markets with Racing Master and upcoming launches for Justice Mobile and Dunk City Dynasty.

Financial highlights

• Total net revenue: RMB 26.2 billion (US$3.7 billion), up 3% quarter-over-quarter, down 3.9% year-over-year.

• Online games net revenue: RMB 20.9 billion (US$3.0 billion), down 4.2% year-over-year.

• Gross profit was RMB 16.5 billion (US$2.3 billion), down 2.9% year-over-year; gross profit margin: 62.9%.

• Non-GAAP net income attributable to shareholders: RMB 7.5 billion (US$1.1 billion).

• Net cash position: RMB 120 billion (US$17.1 billion) as of September 30, 2024.

Outlook and guidance

• Where Winds Meet PC to launch by end of December, mobile version to follow; Marvel Rivals global release set for December 6.

• FragPunk and Project Mugen in testing phases with high expectations for 2025.

• Continued focus on content innovation, international expansion, and long-term game operation.

• NetEase Cloud Music and Youdao are positioned for steady growth alongside the core games business.