NetEase's Profit Growth Accelerates on Game Strength

By Sherry Qin

Chinese videogame giant NetEase reported stronger quarterly profit growth, driven by the strong performance of established titles during the summer break, indicating a clear recovery momentum in its key game business.

The company behind popular games such as "Fantasy Westward Journey" and "Marvel Rivals" on Thursday reported a 32% jump in net profit to 8.62 billion yuan, equivalent to $1.21 billion. Analysts had expected 8.825 billion yuan, according to a FactSet consensus estimate. Adjusted net profit, a closely watched metric that excludes share-based compensation expenses, rose 27% from a year earlier, slightly ahead of estimates.

Revenue at the Hangzhou-based company climbed 8.2% to 28.36 billion yuan, missing market expectations slightly. Sales from games and value-added services rose to 23.3 billion yuan, driven by self-developed games such as "Eggy Party" and "Where Winds Meet."

The solid third-quarter performance comes as NetEase continues to capitalize on its established games, rolling out regular updates and expansions and strengthening operations. More than 20 years after its launch, the original PC version of "Fantasy Westward Journey" broke its own concurrent-user record earlier this month, surpassing 3.58 million gamers after the game maker launched a new server in the summer.

NetEase's robust game pipeline is expected to continue supporting its top line. Citi analysts highlighted that it has two more game launches in the typically soft fourth quarter, following four launches in October.

The game maker's next most-anticipated title in 2026 is "Ananta," a free-to-play role-playing game. It received an overwhelming response from the gaming community following the live demo conducted in September, the analysts said in a note.

NetEase's Hong Kong-listed shares have rebounded by more than 50% this year, bolstered by improved market sentiment toward the videogame industry amid a more stable regulatory environment. Investors have also rewarded the company for its diverse and expanding game portfolio, which has boosted user engagement and spending per user despite macroeconomic uncertainties.

Last week, NetEase's larger rival Tencent reported resilient results, with its international games revenue surging 43% in the third quarter.

Write to Sherry Qin at sherry.qin@wsj.com

(END) Dow Jones Newswires

November 20, 2025 04:31 ET (09:31 GMT)