NetEase generated $3.3 billion in revenue in the second quarter of 2023

Mobile continues to dominate the company’s gaming sector

NetEase generated $3.3 billion in revenue in the second quarter of 2023

NetEase generated 24 billion yuan ($3.3 billion) in the second quarter of 2023, representing a 3.7% increase from the same period of 2022, according to the company's latest financial report.

Games and related added services proved to be the company’s most profitable sector, generating 18.8 billion yuan ($2.6 billion), representing a 3.6% year-on-year increase.

Of this gaming revenue, net revenues from the operation of online gaming generated 91.7%, representing a decrease from 92.7% in Q1 and 92.8% from the same period in Q2 2022. This suggests that NetEase has managed to remain stable, despite the recent regulatory changes in China which have significantly impacted the company’s gaming industry.

Mobile proved to be the ruler of NetEase’s gaming segment, generating approximately 73.6% of online gaming revenue, compared to 72.3% in Q1 and 66.1% in Q2 2022.

Gross profit for the quarter stood at 14,375.4 million yuan ($1,982.5 million), compared to 14,895.5 million ($2,045.5 million) in Q1 and 12,941.5 million yuan ($1,777.1 million) in Q2 2022. In contrast to revenue, this shows some turbulence in the company’s profitability.

New releases

The company highlights several games which helped to bolster its financial performance through the quarter.

June saw the release of three new mobile games, each of which saw strong chart performance in China. Justice led China’s iOS top grossing and download charts, while Racing Master ranked as the third top grossing game on iOS in China, and Badlanders peaked at number 2 on the iOS most downloaded chart.

Additionally, the international release of Harry Potter: Magic Awakened proved successful, bolstering the game’s strong performance in China, generating $2.3 million within the first week of its global release.

“"Our steady second quarter results reflect our dedication to producing exceptional content across our businesses, which generated total net revenues of RMB24.0 billion, up nearly 4% year-over-year," said director and CEO William Ding. "Players continue to revere our flagship Fantasy Westward Journey series, while embracing newer titles like Eggy Party that extend our reach in casual games.

“The June releases of widely acclaimed Justice mobile game and Racing Master further showcase our endless drive to bring players innovative, first-rate games in diversified genres. We believe that each addition to our game portfolio validates our exceptional R&D capabilities and the broad influence our ingenuity has in the marketplace, including expanding the casual game market and altering the face of traditional MMOs.”

We listed NetEase as one of the top 50 mobile game makers of 2023.

Staff Writer

Lewis Rees is a journalist, author, and escape room enthusiast based in South Wales. He got his degree in Film and Video from the University of Glamorgan. He's been a gamer all his life.