Thomas Zhang

Thomas Chang asked management to share their insights on future gaming trends in both China and overseas markets, and to elaborate on NetEase's overseas expansion strategy.

Answer

William Ding, CEO, NetEase, highlighted the company's extensive successful experience in overseas markets, citing titles like Knives Out, Identity V, Marvel Rivals, Where Winds Meet, Sword of Justice, and Naraka: Bladepoint. He emphasized NetEase's unique ability to successfully introduce authentic Chinese Wuxia themes globally and expressed confidence in achieving more international success by providing high-quality content and services. Bill Pang, VP of Corporate Development, NetEase, added that Ananta was recognized as one of the most promising upcoming games at the Tokyo Game Show.

Thomas Zhang asked about the sustainability of Cheetah Mobile's internet business growth in the second half of 2025, key revenue and profit drivers, and the normalized revenue and profit margin levels for the internet business, excluding new AI tool contributions.

Answer

Chairman and CEO Fu Sheng and CFO and Director Thomas Ren explained that the internet business's growth is sustainable, driven by a shift to a user-paid subscription model, product refinement, stable partnerships, and new customer acquisition channels. They anticipate continued healthy absolute revenue and profit, with internal targets for growth rate and profit margin to exceed last year's levels, contingent on channel expansion and AI agent technology integration. They believe the 2C internet business has room for profit margin improvement, acknowledging potential short-term impacts from AI upgrades and product mix fluctuations. The internet business is expected to remain a stable cash flow contributor.