NetEase, a Chinese gaming company, revealed its financial results for the fourth quarter of 2024. The total revenue amounted to 26.7 billion yuan, a decrease of 1.4% compared to the same quarter of the previous year. However, when looking at the revenue specifically from the gaming business, it reached 21.2 billion yuan, an increase of 1.5%. The decrease in revenue was attributed to other business segments of the company, such as the search engine business Youdao and the Cloud Music business.
A standout game that everyone has been watching is Marvel Rivals, a hero shooting game that has performed exceptionally well. It has now surpassed 40 million players. Another game, Where Winds Meet, an action-packed internal power game that launched in December 2024, attracted 3 million players in China within the first 4 days, with a total player base now exceeding 15 million.
However, NetEase acknowledged the need to restructure the development team for Marvel Rivals to reduce development costs, resulting in the disbandment of the development team in North America.
NetEase did not provide detailed information about the disbandment of development teams outside the United States. Nonetheless, Bloomberg reported that over the past few months, NetEase has been gradually closing or discontinuing game development projects in various studios, such as Ouka in Japan, Worlds Untold in Canada, and Jar of Sparks in the United States. This aligns with the new direction set by William Ding, the founder of NetEase, focusing on financial performance, cost reduction, and emphasizing online games with a live service aspect for long-term sustainability.
Source: NetEase, VGC, Bloomberg
TLDR: NetEase reported a decrease in total revenue for Q4 2024 with an increase in revenue from the gaming business. The company is restructuring its development team for Marvel Rivals and focusing on online games with live service features for sustained growth.
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