Netease ((NTES)) has held its Q3 earnings call. Read on for the main highlights of the call.
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The recent earnings call from NetEase painted a picture of robust financial health and strategic success, particularly in the gaming sector. The sentiment was largely positive, driven by strong financial performance and successful game launches, especially in international markets. However, challenges were noted in some segments, such as innovative business and NetEase Cloud Music. Overall, the company’s strategic focus on high-quality game development and global expansion appears to be yielding positive results.
Revenue Growth
NetEase reported an 8% year-over-year increase in total revenues, reaching RMB 28.4 billion in Q3 2025. The growth was primarily fueled by a 12% rise in revenues from games and related value-added services compared to the same period last year.
Successful Game Launches
The company celebrated significant success with its game launches, notably “Destiny: Rising” and “Marvel Rivals,” which topped charts in various markets. “Destiny: Rising” quickly became a top iOS download in the US and other Western markets, highlighting NetEase’s effective global expansion strategy.
Strong Performance of Fantasy Westward Journey
“Fantasy Westward Journey Online” achieved record concurrent player counts, reaching 3.58 million in November 2025. This milestone underscores the game’s enduring popularity and NetEase’s ability to maintain player engagement.
Youdao’s Growth
Youdao, NetEase’s education technology arm, saw its net revenue increase by 15% quarter-over-quarter. This growth was driven by smart devices and online marketing services, showcasing the potential of NetEase’s diversified business model.
Robust Financial Position
NetEase’s financial health remains strong, with a non-GAAP net income attributable to shareholders of RMB 9.5 billion, up 27% year-over-year. The company also maintains a robust cash position with RMB 153.2 billion as of September 30, 2025.
Decline in Innovative Business Revenues
Despite overall growth, NetEase faced a decline in its innovative business revenues, which were down 15% quarter-over-quarter and 19% year-over-year. This decrease was attributed to reduced net revenue from Yanxuan and other businesses.
NetEase Cloud Music Revenue Decline
NetEase Cloud Music experienced a 2% year-over-year decline in net revenue, although membership subscriptions showed growth. This indicates challenges in monetizing the platform despite a growing user base.
Forward-Looking Guidance
Looking ahead, NetEase emphasized its commitment to innovative creativity and long-term operations as key drivers of player engagement and global expansion. The company highlighted its strategic focus on delivering high-quality, culturally resonant content and expanding its global presence through diverse partnerships. Successful game releases, such as “Destiny: Rising,” “Marvel Rivals,” “Once Human,” and “Where Winds Meet,” are expected to continue contributing to revenue growth and increased monthly active users.
In conclusion, NetEase’s earnings call reflected a positive sentiment, underscored by strong financial performance and successful game launches. While challenges exist in certain segments, the company’s strategic focus on high-quality game development and global expansion is clearly paying off. Investors and stakeholders can remain optimistic about NetEase’s future prospects, given its robust financial position and forward-looking strategies.