Financial Performance - Net revenue for Q2 was 27.9 billion RMB, a year-on-year increase of 9.4%, but below the expected 28.4 billion RMB [4] - Gross profit was 18.1 billion RMB, a year-on-year increase of 12.5%, but also below expectations [4] - Net profit reached 8.6 billion RMB, a year-on-year increase of 27.25%, but a significant quarter-on-quarter decline of 16.5% [6] - The company maintained a high gross margin of 64.9% [6] - Cash position remains strong with net cash of 142.1 billion RMB, an 8.1% increase from the beginning of the year [6] Core Business Performance - The gaming and related services segment generated net revenue of 22.8 billion RMB, a year-on-year increase of 13.7%, but a quarter-on-quarter decline of 5% [2][4] - The gross profit from the gaming business was 16.01 billion RMB, slightly exceeding expectations, indicating ongoing cost control pressures [3] - The online music segment reported net revenue of 2 billion RMB, a slight year-on-year decline of 3.5% [5] - The innovative and other businesses segment saw a significant decline in revenue, down 17.8% year-on-year, primarily due to drops in revenue from various services [5] Product and Market Dynamics - Notable new product launches in overseas markets include "Out of Bounds" and "Marvel's Secret Wars," which achieved high download rankings but have not yet translated into significant revenue [3] - The classic IP "Fantasy Westward Journey" reached a peak of 2.93 million concurrent players, showcasing the enduring appeal of the brand [3] - Upcoming titles such as "Forgotten Sea" and "Return to Tang" are expected to test the company's innovation and international strategy [7] Cost and Expense Management - Total operating expenses amounted to 9 billion RMB, a quarter-on-quarter increase of 12.5%, driven by higher marketing expenditures in the gaming sector [6] - The company faces pressure on profitability due to increased operating costs and fluctuating investment income [6]