NetDragon have announced they will be spinning off their education business and merging it with Gravitas Education Holdings.

The move will form an entirely new entity called MYND.AI that - as the name suggests - will focus on mixing their online education business with AI technologies. NetDragon are of course also a major presence in mobile gaming and a myriad of other sectors, running a number of MMORPG’s in the Chinese market.

Although NetDragon has remained a prominent player in mobile gaming due to the diversity of its holdings, its education business has been particularly strong. In their most recent financials they noted that it had achieved 34.2% year-on-year growth compared to a weak performance from their gaming division.

Vice chairman of NetDragon Dr Simon Leung commented, "The decision to spinoff our overseas education business advances our ability to create value for customers and shareholders.”

A move from mobile?

Although NetDragon doesn't appear to be cutting back on their mobile aspirations or business anytime soon, the spinning-off of their highly successful education business does raise some questions. Is this a graduation of sorts, that takes an unexpectedly successful part of their overall portfolio to make it into something new? Or damage control against the fallout of licensing freezes and an overall slump in mobile growth?

The move to AI certainly suggests that the company is seeking to capitalise on a new and highly potent technology, and sees that as a way to potentially drive growth in their business. Regardless, it seems that NetDragon is taking an alternative approach to diversifying its investments compared to rivals such as Tencent and their efforts to bring previously Chinese-only releases to the West. The most recent of which was Honor of Kings that was released in Brazil to a huge number of pre-registrations and slow but consistent growth.