The company’s net revenue stood at $3.4 billion, representing a 10.1 percent increase from the same period in 2022.
Gaming made up 76.5 percent of the company’s net revenue for the quarter with $2.6 billion, a year-on-year increase of 9.1 percent from $2 billion in 2021, and a 15 percent quarter-on-quarter decrease from $2.2 billion in the second quarter.
Online gaming was by far the largest contributor to the company’s gaming revenue, generating 92.9 percent. This number has been fairly consistent, standing at 92.7 percent in the third quarter of 2021 and 92.8 in the second quarter of 2022. It’s clear that the figure is climbing, however the rise has been relatively slow.
Mobile gaming proved to be a particularly strong performer for NetEase in Q3, contributing 68.6 percent of the total online net revenue. Again, this figure is fairly consistent compared both quarter-on-quarter (66.1 percent) and year-on-year (69.2 percent.)
Given the company’s success over the period, it appears that NetEase are successfully navigating the recent changes in the Chinese market, such as the new limits on playtime and the recent hiatus on game licensing. China’s gaming market decreased 19.1 percent in Q3, but NetEase has managed to increase it’s net revenue in the field quarter-on-quarter.
What were the company’s standouts?
The report highlights the continued longevity of key franchises and titles, including Fantasy Westward Journey, Westward Journey Online, and Identity V as critical to its strong performance in the gaming world. The recent release of Diablo Immortal is also cited as a key factor in the company’s strong performance, with the game topping the iOS download charts in China soon after launch.
Looking forward, NetEase is anticipating a strong performance from the upcoming release of Harry Potter: Magic Awakened when it’s rolled out globally in 2023. The game was released in China and several other Asian countries in 2021, and soon became the top grossing mobile game in China.
Earlier this year, we listed NetEase as one of the top 50 mobile game makers of 2022.