NetEase (Minutes): Don't worry too much about the future Pipeline
Below is the earnings call summary for $NetEase(NTES.US) Q1 2025. For earnings analysis, please refer to《NetEase: Defense Turns to Offense? The Old Ginger is Still Spicy!》
1. Key Earnings Highlights:
2. Detailed Earnings Call Content
2.1 Core Management Discussion:
2.1.1: Games
Marvel Rivals: Its successful December launch marked a major milestone for our portfolio and a meaningful step in globalization, building strong momentum globally thanks to acclaimed gameplay and dedicated operations.
Q1 saw sustained high engagement, with April’s Season 2 introducing new attractions like the "Hellfire Gala" event, new maps/heroes, and the mutant island Krakoa. Post-update, it reclaimed #1 on Steam’s global top-sellers. To deepen community ties, we’ll adopt 2-month seasons starting Season 3 while rolling out monthly heroes.
FragPunk: This 5v5 tactical shooter hit 110K peak players within 3 days of March’s PC launch, ranking #6 on Steam. Chapter 2 (April 29) added 70+ vehicles, updated heroes/maps, and debuted on consoles.
Once Human: The mobile version launched April 24 topped iOS revenue charts in 160+ regions. Its optimized cross-platform experience boosted Steam rankings to #5, expanding our open-world PVP phenomenon.
Where Winds Meet: Since its December debut, this immersive open-world RPG has attracted 30M+ players with its narrative depth and historical authenticity. A multi-platform global release is planned for late this year.
Blizzard: Blizzard’s 2024 return drove record engagement—Overwatch 2 set concurrent player records, WoW led social-commerce sales, and Diablo III re-entered China via April tech tests.
Legacy Titles: Fantasy Westward Journey celebrated its mobile decade with White Cat Legend collaborations; Identity V surpassed 400M registrations during its 7th anniversary; Naraka: Bladepoint hit revenue highs with new PVE content. Both Identity V and Naraka were named official esports titles for the 2026 Asian Games—an industry first.
Eggy Party: Lunar New Year events with Calabash Brothers IP drew 100M+ players, setting MAU records. Justice Mobile’s "Starry Amusement Park" update and AI-driven NPCs boosted engagement ahead of its Western/SEA expansion in May.
Racing Master dominated download charts in Japan/Korea/SEA, while Marvel Duel gears up for global launch after positive March tests.
2.1.2: Youdao
Youdao’s Q1 operating profit hit new highs. Its AI-powered "Ziyue" LLM now drives dictionary/translation services, boosting ad revenue via overseas influencer campaigns. New products like the tutor-like Spaceone device (with open-ended Q&A) further solidify its edtech lead.
2.1.3: Yanxuan
Pet/cleaning products remained top-sellers, with Carsen cups and cat food winning industry awards.
2.2 Q&A Highlights
Q1: Identity V’s sustained success—lessons for reviving other games?
A: Its 6-year refinement (especially in Japan) provides a playbook for live ops. We’ll keep investing to expand its asymmetric PVP appeal.
Q2: Marvel Rivals’ season-length adjustments—impact on monetization?
A: April’s Season 2 lifted metrics. Shifting to 2-month seasons + May esports events will stabilize performance.
Q3: Overseas studio closures vs. self-published hits like FragPunk—strategy shift?
A: Closures were product-specific. Our global focus (EU/NA/JP/KR) remains, with homegrown titles validating our approach.
Q4: Where Winds Meet’s next steps after strong launch?
A: This 5-year passion project will be a decade-long staple, with PC-first polish informing future titles.
Q5: Once Human mobile’s soft monetization—plans to boost PC-mobile synergy?
A: Cross-platform play drove 90% PC concurrency/500% spending spikes post-mobile launch. We’ll add scripted PVP modes and private servers.
Q6: FragPunk’s post-launch dip—differentiation in competitive FPS market?
A: Its innovative healing mechanics allow rapid iteration. We’ll sustain marketing/IP collaborations while giving the team runway.
Q7: Domestic vs. overseas resource allocation?
A: Two decades of tools/talent let us execute globally, though we’re improving on overseas player insights.
Q8: New game evaluation criteria—what’s next in the pipeline?
A: Team passion is key. We’ll open our platform to external creators while keeping an unannounced slate.
Q9: Esports ambitions after Identity V/Naraka’s Asian Games inclusion?
A: Our Hangzhou/Shanghai esports arenas will host more premium events, with long-term investments continuing.
Q10: AI’s impact on content cadence/promotion?
A: We’ve used AI in development for 5+ years. It’s an industry-wide lever—we’ll keep deepening applications.
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Disclosures: Dolphin Research Disclaimer
