Thanks to continuous innovation and the release of new games, NetEase's core business segment—gaming business saw a year-on-year revenue growth of 12.1% in Q1, contributing to an overall revenue growth of 7.4% year-on-year in Q1, with a gross profit increase of 8.6% year-on-year. NetEase Youdao's Q1 operating profit of 104 million exceeded market expectations, setting a historical high for the first quarter.
On Thursday, May 15, NetEase announced its unaudited Q1 results for the period ending March 31.
<blockquote>
Q1 revenue was RMB 28.83 billion, a year-on-year increase of 7.4%, estimated at RMB 28.49 billion.
<ul>
<li>Net revenue from games and related value-added services was RMB 24 billion, a year-on-year increase of 12.1%, estimated at RMB 23.08 billion.</li>
<li>Youdao's net revenue was RMB 1.3 billion, a year-on-year decrease of 6.7%. (Details below)</li>
<li>Net revenue from NetEase Cloud Music was RMB 1.9 billion, a year-on-year decrease of 8.4%.</li>
<li>Net revenue from innovative businesses and others was RMB 1.62 billion, a year-on-year decrease of 17.6%, estimated at RMB 1.87 billion.</li>
</ul>
Gross profit was RMB 18.48 billion, a year-on-year increase of 8.6%, estimated at RMB 17.57 billion.
<ul>
<li>Gross profit from online gaming services was RMB 16.55 billion, estimated at RMB 15.61 billion.</li>
</ul>
Net profit attributable to the parent company was RMB 10.3 billion, with Non-GAAP net profit attributable to the parent company at RMB 11.2 billion.
Adjusted earnings per ADS from continuing operations were RMB 17.51, estimated at RMB 13.73.
Basic earnings per share were USD 0.45 (USD 2.24 per American Depositary Share). Non-GAAP basic earnings per share were USD 0.49 (USD 2.44 per ADS).
</blockquote>
Among them, NetEase Youdao's Q1 financial report:
<blockquote>
Q1 revenue was RMB 1.3 billion, a year-on-year decrease of 6.7%.
Q1 operating profit of 104 million exceeded market expectations, setting a historical high for the first quarter, with a year-on-year increase of 247.7%.
Q1 operating cash net outflow narrowed by 34.7% year-on-year, with significant improvement in financial efficiency.
In Q1, Youdao continued to advance the deep application of AI technology in the learning services field, promoting product intelligence upgrades based on the &#34;ZiYue&#34; large model. Net income from learning services in Q1 reached RMB 602 million.
Youdao's AI subscription service also achieved strong growth, with sales of nearly RMB 70 million in Q1, a year-on-year increase of over 40%.
</blockquote>
NetEase's U.S. stock rose over 3% in pre-market trading.
<img src="https://imageproxy.pbkrs.com/https://wpimg-wscn.awtmt.com/a9372e8c-8037-481a-ab6f-8cec14dfc218.jpeg?x-oss-process=image/auto-orient,1/interlace,1/resize,w_1440,h_1440/quality,q_95/format,jpg" alt="" original-src="https://imageproxy.pbkrs.com/https://wpimg-wscn.awtmt.com/a9372e8c-8037-481a-ab6f-8cec14dfc218.jpeg"/>
<h2>Game business revenue increased by 12.1% year-on-year, Youdao's operating profit reached a historical high in the first quarter</h2>
NetEase pointed out that the company's highlights include outstanding performance in the gaming sector in the first quarter, with several new game releases creating a buzz in the global gaming market, further enriching the game types.
<ul>
<li>
&#34;Marvel Duel&#34; topped the Steam global bestseller list shortly after the update of its second season in April 2025.
</li>
<li>
&#34;Nirvana in Fire&#34; has been very popular since its release in December 2024, with over 30 million registered players as of March 2025.
</li>
<li>
&#34;Outsiders: The Surge&#34; ignited player enthusiasm after its launch in March 2025, with over 110,000 players online simultaneously within three days, ranking sixth on the Steam global bestseller list.
</li>
<li>
The mobile game &#34;Once Human&#34; quickly ranked first on the iOS download charts in over 160 regions after its launch in April 2025, with global attention surging.
</li>
<li>
Blizzard games maintain strong momentum, with &#34;World of Warcraft&#34; and &#34;Hearthstone&#34; attracting Chinese players again through localization activities. Additionally, &#34;Overwatch&#34; set a historical peak for simultaneous online players in China. &#34;Diablo III&#34; will begin technical testing on April 16, 2025, with hopes of re-entering the Chinese market.
</li>
<li>
Through events and cross-industry collaborations, the popularity of classic games such as &#34;Fantasy Westward Journey,&#34; &#34;Identity V,&#34; &#34;Egg Party,&#34; &#34;Naraka: Bladepoint,&#34; and &#34;Nirvana in Fire&#34; has been enhanced, reflecting NetEase's strength in long-term game operations.
</li>
<li>
Strengthening the global game product line, several new games under development, such as &#34;MARVEL Mystic Mayhem,&#34; &#34;Destiny: Rising,&#34; and &#34;Ananta,&#34; further enrich the game lineup.
</li>
</ul>
In addition, Youdao Company insists on technological innovation to enhance profitability, with the first-quarter operating profit reaching a historical high, continuing the profit momentum of previous quarters.
NetEase CEO Ding Lei stated that NetEase started strong in 2025, mainly due to continuous innovation and new game releases:
<blockquote>
&#34;We entered 2025 with strong momentum, thanks to our ongoing innovation and new game releases, which not only expanded game types but also successfully attracted global players.&#34;
</blockquote>
He emphasized that in addition to the outstanding performance of new games, NetEase's classic game series continues to shine, due to quality content updates and gameplay improvements, providing players with a new gaming experience. While continuously exploring new gaming possibilities, NetEase remains committed to innovation and long-term operations, and continues to provide attractive gaming experiences for global players through collaboration with top talents and strategic partners.
Ding Lei stated that in addition to the gaming business, Youdao and other businesses also maintained healthy development in the first quarter, relying on high-quality and technology-driven innovation. NetEase's goal is to deepen user interaction, create lasting value, and connect, entertain, and serve domestic and international users in innovative ways
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NetEase Q4 & Fiscal Year 2024 Financial Results

NetEase announced its financial report for the first quarter of 2023, with game business revenue increasing by 12.1% year-on-year, overall revenue increasing by 7.4% year-on-year, and a net profit of 10.3 billion yuan, a year-on-year increase of 34.9%. NetEase Youdao's operating profit was 104 million yuan, exceeding market expectations and setting a historical high. The net revenue from games and related value-added services was 24 billion yuan, with a gross profit of 18.48 billion yuan, a year-on-year increase of 8.6%. Youdao's net revenue was 1.3 billion yuan, a year-on-year decrease of 6.7%

- NetEase reported a 12.1% year-on-year revenue growth in its gaming segment for Q1, contributing to an overall revenue increase of 7.4%.  
- The company achieved a record operating profit of 1.04 billion RMB for NetEase Youdao, exceeding market expectations, while its gaming services saw significant player engagement with new releases.  
- CEO Ding Lei emphasized that continuous innovation and new game launches have driven strong performance, alongside healthy growth in other business areas.

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NetEase Q1 game revenue increased by over 12% year-on-year, with a net profit of 10.3 billion, a year-on-year growth of 34.9% | Financial Report Insights