Group 1 - The core business of NetEase remains its gaming sector, which is the only segment showing positive growth, with Q1 net revenue reaching 28.8 billion RMB, a 7.4% increase year-over-year [3] - CEO Ding Lei has returned to focus on gaming, leading to internal adjustments and a commitment to producing high-quality games [3][5] - New game releases such as "Marvel Showdown" and "Out of Bounds" have quickly topped global sales charts, contributing to the company's strong performance [3][7] Group 2 - The game "Yanyun Sixteen Sounds" has surpassed 30 million users since its launch in December 2024, with expectations for it to become a long-lasting project [5][8] - The game has been well-received in the market, filling a gap in the domestic gaming landscape for martial arts-themed games [11] - The game's development is supported by Guangdong's rich martial arts culture, which may enhance its growth potential [11]

Core Viewpoint - NetEase's Q1 2025 performance showed significant growth, driven by both new and existing games, with a net revenue of 28.8 billion yuan, a year-on-year increase of 7.4% [1][11] Revenue Growth - In Q1 2025, NetEase's net revenue from online games and related value-added services reached 24 billion yuan, up from 21.2 billion yuan in the previous quarter and 21.5 billion yuan in the same quarter last year [2] - Online games accounted for approximately 97.5% of the net revenue in this segment, an increase from 96.7% in the previous quarter and 95.2% year-on-year [2] Game Performance - The newly launched games, including "Marvel Showdown" and "Yanyun Sixteen Sounds," contributed to revenue growth, with "Marvel Showdown" achieving record highs on Steam after its second season update [2][3] - "Yanyun Sixteen Sounds" surpassed 30 million registered players by March 2025, filling a gap in the market for martial arts-themed games [5][10] Game Strategy - The company plans to adjust the update cycle for "Marvel Showdown" from three months to two months, aiming to enhance player engagement and stabilize game metrics [5] - The monetization strategy for "Yanyun" focuses on a tiered, low-pressure payment model, allowing players to enjoy the game without heavy financial commitment [6] Long-term Game Development - The success of "Identity V," which has been optimized over six years, demonstrates the potential for long-term game sustainability, with a significant revenue increase of 123% in January 2025 [7][8] - The company emphasizes the importance of continuous content updates and player loyalty for the longevity of its games, particularly for "Yanyun" [9][10] Market Response - Following the positive financial results, NetEase's stock price rose by 13.03% to 190 HKD on May 16, 2025, reflecting investor confidence [11]