Technology

NetEase Announces Second Quarter 2024 Unaudited Financial Results

Published

1 month ago

August 22, 2024

HANGZHOU, China, Aug. 22, 2024 /PRNewswire/ — NetEase, Inc. (NASDAQ: NTES and HKEX: 9999, “NetEase” or the “Company”), a leading internet and game services provider, today announced its unaudited financial results for the second quarter ended June 30, 2024.

Second Quarter 2024 Financial Highlights

Net revenues were RMB25.5 billion (US$3.5 billion), an increase of 6.1% compared with the same quarter of 2023.Games and related value-added services net revenues were RMB20.1 billion (US$2.8 billion), an increase of 6.7% compared with the same quarter of 2023.Youdao net revenues were RMB1.3 billion (US$181.9 million), an increase of 9.5% compared with the same quarter of 2023.Cloud Music net revenues were RMB2.0 billion (US$280.8 million), an increase of 4.7% compared with the same quarter of 2023.Innovative businesses and others net revenues were RMB2.1 billion (US$284.5 million), which was relatively stable compared with the same quarter of 2023.Gross profit was RMB16.0 billion (US$2.2 billion), an increase of 11.6% compared with the same quarter of 2023.Total operating expenses were RMB9.0 billion (US$1.2 billion), an increase of 8.9% compared with the same quarter of 2023.Net income attributable to the Company’s shareholders was RMB6.8 billion (US$930.0 million). Non-GAAP net income attributable to the Company’s shareholders was RMB7.8 billion (US$1.1 billion).[1] Basic net income per share was US$0.29 (US$1.45 per ADS). Non-GAAP basic net income per share was US$0.33 (US$1.67 per ADS).[1]

[1] As used in this announcement, non-GAAP net income attributable to the Company’s shareholders and non-GAAP basic and diluted net income per share and per ADS are defined to exclude share-based compensation expenses. See the unaudited reconciliation of GAAP and non-GAAP results at the end of this announcement.

Second Quarter 2024 and Recent Operational Highlights

Launched popular new titles, further enhancing our appeal in diversified genres:Lost Light mobile game, a multiplayer tactical shooter game, topped the iOS download charts in China following its June launch.Once Human, a multiplayer open-world survival game set in a post-apocalyptic world, attained over 230,000 peak concurrent users on Steam soon after its launch, ranking among the top 5 most-played games in the world.Naraka: Bladepoint mobile game hit the top 3 on iOS grossing charts soon after launch in China, and topped the iOS download chart for over a week.Generated continued popularity of hit games, with Naraka: Bladepoint reaching record-high DAUs on its three-year anniversary, and Identity V continuing its strong performance, hitting record-high DAUs in July and August, consecutively.Brought highly anticipated NetEase titles to partners’ world-leading gaming platforms:Unveiled plans to bring Where Winds Meet and Marvel Rivals to consoles at PlayStation State of Play. Marvel Rivals also announced during Gamescom its release date for December 6th.Announced FragPunk, a 5v5 first-person hero shooter game, at the Xbox Games Showcase 2024, highlighting its innovative shooting experience with unique card mechanics.Eggy Party joined Nintendo Direct with upcoming plans for a worldwide release on Switch.Brought World of Warcraft back to China with players enthusiastically welcoming the unfolding return of Blizzard’s game portfolio.Youdao continued to drive growth in digital content services, online marketing services and AI-driven subscription services, recording historic-high operating cash flow and significantly narrowed operating loss compared with the same quarter of last year.Cloud Music continued to propel quality development across its music-centric ecosystem, further augmented its unique community, and kept bringing users high-quality music experiences.

“The robust R&D and operating capabilities we’ve built over the past two decades have shaped our formidable games portfolio of time-honored titles and newer innovative hits that redefine genres and diversify our offerings,” said Mr. William Ding, Chief Executive Officer and Director of NetEase. “With a growing portfolio of games that feature higher quality and cover more genres, we are thrilled to bring exciting NetEase gaming experiences to more players around the globe. As we expand our reach to players in China and worldwide, innovation remains our priority. We will continue to explore opportunities with talent and partners in the industry to drive the next wave of gaming trends.

“Alongside our games, Cloud Music and Youdao are also on track for continued growth this year. Superior content is the thread that connects our NetEase family, and we continue to bring experiences that resonate with our users across our businesses,” Mr. Ding concluded.

Second Quarter 2024 Financial Results

Net Revenues

Net revenues for the second quarter of 2024 were RMB25.5 billion (US$3.5 billion), compared with RMB26.9 billion and RMB24.0 billion for the preceding quarter and the same quarter of 2023, respectively.

Net revenues from games and related value-added services were RMB20.1 billion (US$2.8 billion) for the second quarter of 2024, compared with RMB21.5 billion and RMB18.8 billion for the preceding quarter and the same quarter of 2023, respectively. Net revenues from the operation of online games accounted for approximately 96.1% of the segment’s net revenues for the second quarter of 2024, compared with 95.2% and 91.7% for the preceding quarter and the same quarter of 2023, respectively. Net revenues from mobile games accounted for approximately 76.4% of net revenues from the operation of online games for the second quarter of 2024, compared with 78.6% and 73.6% for the preceding quarter and the same quarter of 2023, respectively.

Net revenues from Youdao were RMB1.3 billion (US$181.9 million) for the second quarter of 2024, compared with RMB1.4 billion and RMB1.2 billion for the preceding quarter and the same quarter of 2023, respectively.

Net revenues from Cloud Music were RMB2.0 billion (US$280.8 million) for the second quarter of 2024, compared with RMB2.0 billion and RMB1.9 billion for the preceding quarter and the same quarter of 2023, respectively.

Net revenues from innovative businesses and others were RMB2.1 billion (US$284.5 million) for the second quarter of 2024, compared with RMB2.0 billion and RMB2.1 billion for the preceding quarter and the same quarter of 2023, respectively.

Gross Profit

Gross profit for the second quarter of 2024 was RMB16.0 billion (US$2.2 billion), compared with RMB17.0 billion and RMB14.4 billion for the preceding quarter and the same quarter of 2023, respectively.

The quarter-over-quarter decrease in games and related value-added services’ gross profit was primarily due to lower net revenues from certain mobile games. The year-over-year increase was primarily due to increased net revenues from mobile games such as Identity V and Justice mobile game, launched in 2023.

The quarter-over-quarter decrease in Youdao’s gross profit was primarily due to lower net revenues from its learning services. The year-over-year increase was primarily due to higher net revenues from its online marketing services.

The quarter-over-quarter decrease in Cloud Music’s gross profit primarily resulted from the one-off adjustment of certain copyright costs in the preceding quarter. The year-over-year increase was primarily due to increased net revenues from sales of membership subscriptions and continued improvement in cost control measures.

The quarter-over-quarter and year-over-year increases in innovative businesses and others’ gross profit were primarily due to increased gross profit from Yanxuan and several other businesses included within the segment.

Gross Profit Margin

Gross profit margin for games and related value-added services for the second quarter of 2024 was 70.0%, compared with 69.5% and 67.4% for the preceding quarter and the same quarter of 2023, respectively. The quarter-over-quarter and year-over-year increases were mainly attributable to changes in product mix.

Gross profit margin for Youdao for the second quarter of 2024 was 48.2%, compared with 49.0% and 47.0% for the preceding quarter and the same quarter of 2023, respectively. The quarter-over-quarter decrease was mainly due to decreased revenue contribution from its learning services. The year-over-year increase was mainly due to the improvement of gross profit margin from its online marketing services.

Gross profit margin for Cloud Music for the second quarter of 2024 was 32.1%, compared with 38.0% and 27.0% for the preceding quarter and the same quarter of 2023, respectively. The quarter-over-quarter and year-over-year fluctuations were mainly due to the factors enumerated above. The one-off adjustment of copyright costs mentioned above increased the gross profit margin in the preceding quarter by approximately five percentage points.

Gross profit margin for innovative businesses and others for the second quarter of 2024 was 34.0%, compared with 33.4% and 29.5% for the preceding quarter and the same quarter of 2023, respectively. The quarter-over-quarter and year-over-year increases were mainly due to changes in the product mix within the segment.

Operating Expenses

Total operating expenses for the second quarter of 2024 were RMB9.0 billion (US$1.2 billion), compared with RMB9.4 billion and RMB8.3 billion for the preceding quarter and the same quarter of 2023, respectively. The quarter-over-quarter decrease was mainly due to decreased marketing expenditures related to games and related value-added services. The year-over-year increase was mainly due to increased research and development investments and marketing expenditures associated with games and related value-added services.

Other Income/(Expenses)

Other income/(expenses) consisted of investment income, interest income, exchange gains/(losses) and others. The quarter-over-quarter and year-over-year decreases were mainly due to net exchange losses in the second quarter of 2024 compared with net exchange gains recorded in the preceding quarter and the same quarter of 2023.

Income Tax

The Company recorded a net income tax charge of RMB1.3 billion (US$179.0 million) for the second quarter of 2024, compared with RMB1.5 billion and RMB712.1 million for the preceding quarter and the same quarter of 2023, respectively. The effective tax rate for the second quarter of 2024 was 16.0%, compared with 16.0% and 8.0% for the preceding quarter and the same quarter of 2023, respectively. The effective tax rate represents certain estimates by the Company as to the tax obligations and benefits applicable to it in each quarter.

Net Income and Non-GAAP Net Income

Net income attributable to the Company’s shareholders totaled RMB6.8 billion (US$930.0 million) for the second quarter of 2024, compared with RMB7.6 billion and RMB8.2 billion for the preceding quarter and the same quarter of 2023, respectively.

NetEase reported basic net income of US$0.29 per share (US$1.45 per ADS) for the second quarter of 2024, compared with US$0.33 per share (US$1.64 per ADS) and US$0.35 per share (US$1.76 per ADS) for the preceding quarter and the same quarter of 2023, respectively.

Non-GAAP net income attributable to the Company’s shareholders totaled RMB7.8 billion (US$1.1 billion) for the second quarter of 2024, compared with RMB8.5 billion and RMB9.0 billion for the preceding quarter and the same quarter of 2023, respectively.

NetEase reported non-GAAP basic net income of US$0.33 per share (US$1.67 per ADS) for the second quarter of 2024, compared with US$0.36 per share (US$1.82 per ADS) and US$0.39 per share (US$1.93 per ADS) for the preceding quarter and the same quarter of 2023, respectively.

Other Financial Information

As of June 30, 2024, the Company’s net cash (total cash and cash equivalents, current and non-current time deposits and restricted cash, as well as short-term investments balance, minus short-term and long-term loans) totaled RMB116.1 billion (US$16.0 billion), compared with RMB110.9 billion as of December 31, 2023. Net cash provided by operating activities was RMB6.5 billion (US$898.8 million) for the second quarter of 2024, compared with RMB9.6 billion and RMB7.7 billion for the preceding quarter and the same quarter of 2023, respectively.

Quarterly Dividend

The board of directors has approved a dividend of US$0.0870 per share (US$0.4350 per ADS) for the second quarter of 2024 to holders of ordinary shares and holders of ADSs as of the close of business on September 6, 2024, Beijing/Hong Kong Time and New York Time, respectively, payable in U.S. dollars. For holders of ordinary shares, in order to qualify for the dividend, all valid documents for the transfer of shares accompanied by the relevant share certificates must be lodged for registration with the Company’s Hong Kong branch share registrar, Computershare Hong Kong Investor Services Limited, at Shops 1712-1716, 17th Floor, Hopewell Centre, 183 Queen’s Road East, Wanchai, Hong Kong no later than 4:30 p.m. on September 6, 2024 (Beijing/ Hong Kong Time). The payment date is expected to be September 17, 2024 for holders of ordinary shares and on or around September 20, 2024 for holders of ADSs.

NetEase paid a dividend of US$0.0990 per share (US$0.4950 per ADS) for the first quarter of 2024 in June 2024.

Under the Company’s current dividend policy, the determination to make dividend distributions and the amount of such distribution in any particular quarter will be made at the discretion of its board of directors and will be based upon the Company’s operations and earnings, cash flow, financial condition and other relevant factors.

Share Repurchase Program

On November 17, 2022, the Company announced that its board of directors had approved a share repurchase program of up to US$5.0 billion of the Company’s ADSs and ordinary shares in open market transactions. This share repurchase program commenced on January 10, 2023 and will be in effect for a period not to exceed 36 months from such date. As of June 30, 2024, approximately 11.9 million ADSs had been repurchased under this program for a total cost of US$1.1 billion.

The extent to which NetEase repurchases its ADSs and its ordinary shares depends upon a variety of factors, including market conditions. These programs may be suspended or discontinued at any time.

** The United States dollar (US$) amounts disclosed in this announcement are presented solely for the convenience of the reader. The percentages stated are calculated based on RMB.

Conference Call

NetEase’s management team will host a teleconference call with a simultaneous webcast at 8:00 a.m. New York Time on Thursday, August 22, 2024 (Beijing/Hong Kong Time: 8:00 p.m., Thursday, August 22, 2024). NetEase’s management will be on the call to discuss the quarterly results and answer questions.

Interested parties may participate in the conference call by dialing 1-914-202-3258 and providing conference ID: 10040836, 15 minutes prior to the initiation of the call. A replay of the call will be available by dialing 1-855-883-1031 and entering PIN: 10040836. The replay will be available through August 29, 2024.

This call will be webcast live and the replay will be available for 12 months. Both will be available on NetEase’s Investor Relations website at http://ir.netease.com/.

About NetEase, Inc.

NetEase, Inc. (NASDAQ: NTES and HKEX: 9999, “NetEase”) is a leading internet and game services provider centered around premium content. With extensive offerings across its expanding gaming ecosystem, the Company develops and operates some of the most popular and longest running mobile and PC games available in China and globally.

Powered by one of the largest in-house game R&D teams focused on mobile, PC and console, NetEase creates superior gaming experiences, inspires players, and passionately delivers value for its thriving community worldwide. By infusing play with culture, and education with technology, NetEase transforms gaming into a meaningful vehicle to build a more entertaining and enlightened world.

Beyond games, NetEase service offerings include its majority-controlled subsidiaries Youdao (NYSE: DAO), an intelligent learning company with industry-leading technology, and Cloud Music (HKEX: 9899), a well-known online music platform featuring a vibrant content community, as well as Yanxuan, NetEase’s private label consumer lifestyle brand.

For more information, please visit: http://ir.netease.com/.

Forward Looking Statements

This announcement contains statements of a forward-looking nature. These statements are made under the “safe harbor” provisions of the U.S. Private Securities Litigation Reform Act of 1995. You can identify these forward-looking statements by terminology such as “will,” “expects,” “anticipates,” “future,” “intends,” “plans,” “believes,” “estimates” and similar expressions. In addition, statements that are not historical facts, including statements about NetEase’s strategies and business plans, its expectations regarding the growth of its business and its revenue and the quotations from management in this announcement are or contain forward-looking statements. NetEase may also make forward-looking statements in its periodic reports to the U.S. Securities and Exchange Commission (the “SEC”), in announcements made on the website of The Stock Exchange of Hong Kong Limited (the “Hong Kong Stock Exchange”), in press releases and other written materials and in oral statements made by its officers, directors or employees to third parties. The accuracy of these statements may be impacted by a number of business risks and uncertainties that could cause actual results to differ materially from those projected or anticipated, including risks related to: the risk that the online games market will not continue to grow or that NetEase will not be able to maintain its position in that market in China or globally; risks associated with NetEase’s business and operating strategies and its ability to implement such strategies; NetEase’s ability to develop and manage its operations and business; competition for, among other things, capital, technology and skilled personnel; potential changes in government regulation that could adversely affect the industry and geographical markets in which NetEase operates; the risk that NetEase may not be able to continuously develop new and creative online services or that NetEase will not be able to set, or follow in a timely manner, trends in the market; risks related to economic uncertainty and capital market disruption; risks related to the expansion of NetEase’s businesses and operations internationally; risks associated with cybersecurity threats or incidents; and the risk that fluctuations in the value of the Renminbi with respect to other currencies could adversely affect NetEase’s business and financial results. Further information regarding these and other risks is included in NetEase’s filings with the SEC and announcements on the website of the Hong Kong Stock Exchange. NetEase does not undertake any obligation to update this forward-looking information, except as required under applicable law.

Non-GAAP Financial Measures

NetEase considers and uses non-GAAP financial measures, such as non-GAAP net income attributable to the Company’s shareholders and non-GAAP basic and diluted net income per ADS and per share, as supplemental metrics in reviewing and assessing its operating performance and formulating its business plan. The presentation of non-GAAP financial measures is not intended to be considered in isolation or as a substitute for the financial information prepared and presented in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”).

NetEase defines non-GAAP net income attributable to the Company’s shareholders as net income attributable to the Company’s shareholders excluding share-based compensation expenses. Non-GAAP net income attributable to the Company’s shareholders enables NetEase’s management to assess its operating results without considering the impact of share-based compensation expenses. NetEase believes that this non-GAAP financial measure provide useful information to investors in understanding and evaluating the Company’s current operating performance and prospects in the same manner as management does, if they so choose. NetEase also believes that the use of this non-GAAP financial measure facilitates investors’ assessment of its operating performance.

Non-GAAP financial measures are not defined under U.S. GAAP and are not presented in accordance with U.S. GAAP. Non-GAAP financial measures have limitations as analytical tools. One of the key limitations of using non-GAAP net income attributable to the Company’s shareholders is that it does not reflect all items of expense/ income that affect our operations. Share-based compensation expenses have been and may continue to be incurred in NetEase’s business and are not reflected in the presentation of non-GAAP net income attributable to the Company’s shareholders. In addition, the non-GAAP financial measures NetEase uses may differ from the non-GAAP measures used by other companies, including peer companies, and therefore their comparability may be limited.

NetEase compensates for these limitations by reconciling non-GAAP net income attributable to the Company’s shareholders to the nearest U.S. GAAP performance measure, all of which should be considered when evaluating the Company’s performance. See the unaudited reconciliation of GAAP and non-GAAP results at the end of this announcement. NetEase encourages you to review its financial information in its entirety and not rely on a single financial measure.

Contact for Media and Investors:
Email: ir@service.netease.com
Tel: (+86) 571-8985-3378

NETEASE, INC.

UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS

(in thousands)

December 31,

June 30,

2023

2024

RMB

USD (Note 1)

Assets

Current assets:

Cash and cash equivalents

21,428,902

18,982,239

2,612,043

Time deposits

100,856,034

93,456,225

12,860,005

Restricted cash

2,777,206

2,869,827

394,901

Accounts receivable, net

6,422,417

6,364,847

875,832

Inventories

695,374

574,441

79,046

Prepayments and other current assets, net

6,076,595

5,487,749

755,139

Short-term investments

4,436,057

10,417,802

1,433,537

Total current assets

142,692,585

138,153,130

19,010,503

Non-current assets:

Property, equipment and software, net

8,075,044

8,092,032

1,113,501

Land use rights, net

4,075,143

4,022,255

553,481

Deferred tax assets

1,560,088

1,504,697

207,053

Time deposits

1,050,000

3,940,000

542,162

Restricted cash

550

3,250

447

Other long-term assets

28,471,568

27,627,257

3,801,637

Total non-current assets

43,232,393

45,189,491

6,218,281

Total assets

185,924,978

183,342,621

25,228,784

Liabilities, Redeemable Noncontrolling Interests
and Shareholders’ Equity

Current liabilities:

Accounts payable

881,016

792,003

108,983

Salary and welfare payables

4,857,206

3,606,360

496,252

Taxes payable

2,571,534

2,381,220

327,667

Short-term loans

19,240,163

13,187,247

1,814,626

Contract liabilities

13,362,166

13,615,857

1,873,604

Accrued liabilities and other payables

12,930,399

12,345,208

1,698,757

Total current liabilities

53,842,484

45,927,895

6,319,889

Non-current liabilities:

Deferred tax liabilities

2,299,303

1,448,781

199,359

Long-term loans

427,997

58,894

Other long-term liabilities

1,271,113

1,192,543

164,099

Total non-current liabilities

3,998,413

3,069,321

422,352

Total liabilities

57,840,897

48,997,216

6,742,241

Redeemable noncontrolling interests

115,759

119,498

16,443

NetEase, Inc.’s shareholders’ equity

124,285,776

130,909,906

18,013,803

Noncontrolling interests

3,682,546

3,316,001

456,297

Total equity

127,968,322

134,225,907

18,470,100

Total liabilities, redeemable noncontrolling
interests and shareholders’ equity

185,924,978

183,342,621

25,228,784

The accompanying notes are an integral part of this announcement.

NETEASE, INC.

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(in thousands, except per share data or per ADS data)

Three Months Ended

Six Months Ended

June 30,

March 31,

June 30,

2023

2024

2023

2024

RMB

USD (Note 1)

RMB

USD (Note 1)

Net revenues

24,011,301

26,851,741

25,485,805

3,506,963

49,057,588

52,337,546

7,201,886

Cost of revenues

(9,635,888)

(9,835,821)

(9,443,587)

(1,299,481)

(19,785,629)

(19,279,408)

(2,652,935)

Gross profit

14,375,413

17,015,920

16,042,218

2,207,482

29,271,959

33,058,138

4,548,951

Operating expenses:

Selling and marketing expenses

(3,271,705)

(4,022,204)

(3,501,737)

(481,855)

(6,176,751)

(7,523,941)

(1,035,329)

General and administrative expenses

(1,132,147)

(1,196,475)

(1,091,441)

(150,187)

(2,153,825)

(2,287,916)

(314,828)

Research and development expenses

(3,908,907)

(4,174,758)

(4,455,717)

(613,127)

(7,658,639)

(8,630,475)

(1,187,593)

Total operating expenses

(8,312,759)

(9,393,437)

(9,048,895)

(1,245,169)

(15,989,215)

(18,442,332)

(2,537,750)

Operating profit

6,062,654

7,622,483

6,993,323

962,313

13,282,744

14,615,806

2,011,201

Other income/(expenses):

Investment income, net

287,691

179,291

103,674

14,266

759,059

282,965

38,937

Interest income, net

935,578

1,277,597

1,186,219

163,229

1,711,608

2,463,816

339,032

Exchange gains/(losses), net

1,464,956

15,011

(239,375)

(32,939)

1,078,388

(224,364)

(30,874)

Other, net

120,826

193,888

85,694

11,792

378,859

279,582

38,472

Income before tax

8,871,705

9,288,270

8,129,535

1,118,661

17,210,658

17,417,805

2,396,768

Income tax

(712,090)

(1,485,910)

(1,300,939)

(179,015)

(2,340,649)

(2,786,849)

(383,483)

Net income

8,159,615

7,802,360

6,828,596

939,646

14,870,009

14,630,956

2,013,285

Accretion of redeemable noncontrolling
interests

(868)

(958)

(960)

(132)

(1,728)

(1,918)

(264)

Net loss/(income) attributable to noncontrolling
interests and redeemable noncontrolling
interests

84,020

(167,456)

(68,887)

(9,479)

129,120

(236,343)

(32,522)

Net income attributable to the
Company’s shareholders

8,242,767

7,633,946

6,758,749

930,035

14,997,401

14,392,695

1,980,499

Net income per share *

Basic

2.56

2.38

2.10

0.29

4.66

4.48

0.62

Diluted

2.54

2.35

2.08

0.29

4.61

4.43

0.61

Net income per ADS *

Basic

12.80

11.88

10.50

1.45

23.29

22.39

3.08

Diluted

12.69

11.75

10.42

1.43

23.05

22.17

3.05

Weighted average number of ordinary
shares used in calculating net income
per share *

Basic

3,218,783

3,211,665

3,217,699

3,219,926

3,214,682

Diluted

3,248,916

3,249,452

3,243,056

3,252,707

3,246,254

* Each ADS represents five ordinary shares.

The accompanying notes are an integral part of this announcement.

NETEASE, INC.

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands)

Three Months Ended

Six Months Ended

June 30,

March 31,

June 30,

2023

2024

2023

2024

RMB

USD (Note 1)

RMB

USD (Note 1)

Cash flows from operating activities:

Net income

8,159,615

7,802,360

6,828,596

939,646

14,870,009

14,630,956

2,013,285

Adjustments to reconcile net income to net cash provided
by operating activities:

Depreciation and amortization

661,363

567,923

631,957

86,960

1,743,632

1,199,880

165,109

Fair value changes of equity security and other investments

(78,035)

(368,258)

(7,887)

(1,085)

(304,755)

(376,145)

(51,759)

Impairment losses on investments

47,870

128,417

210,741

28,999

47,870

339,158

46,670

Fair value changes of short-term investments

(96,884)

(60,810)

(128,295)

(17,654)

(234,800)

(189,105)

(26,022)

Share-based compensation cost

787,862

894,300

1,079,056

148,482

1,610,275

1,973,356

271,543

Allowance for expected credit losses

8,540

11,600

9,281

1,277

29,260

20,881

2,873

Losses/(gains) on disposal of property, equipment and software

252

2,132

(326)

(45)

(358)

1,806

249

Unrealized exchange (gains)/losses

(1,466,295)

(17,509)

(209,311)

(28,802)

(1,080,334)

(226,820)

(31,211)

Gains on disposal of long-term investments, business and
subsidiaries

(16,382)

(13,487)

(141,114)

(19,418)

(22,150)

(154,601)

(21,274)

Deferred income taxes

(334,380)

485,054

(1,280,076)

(176,144)

243,286

(795,022)

(109,399)

Share of results on equity method investees

(129,292)

164,271

39,200

5,394

(225,100)

203,471

27,999

Changes in operating assets and liabilities:

Accounts receivable

770,551

(1,358,711)

1,410,478

194,088

(345,731)

51,767

7,123

Inventories

69,410

91,378

29,552

4,067

186,740

120,930

16,641

Prepayments and other assets

(7,233)

326,140

530,856

73,048

118,594

856,996

117,927

Accounts payable

(115,791)

(7,001)

(126,862)

(17,457)

(728,730)

(133,863)

(18,420)

Salary and welfare payables

758,106

(2,178,608)

879,058

120,963

(1,467,631)

(1,299,550)

(178,824)

Taxes payable

(992,892)

1,271,822

(1,462,700)

(201,274)

(259,176)

(190,878)

(26,266)

Contract liabilities

(41,196)

1,574,086

(1,270,324)

(174,801)

448,795

303,762

41,799

Accrued liabilities and other payables

(306,784)

242,070

(490,048)

(67,433)

(950,620)

(247,978)

(34,123)

Net cash provided by operating activities

7,678,405

9,557,169

6,531,832

898,811

13,679,076

16,089,001

2,213,920

Cash flows from investing activities:

Purchase of property, equipment and software

(520,544)

(415,018)

(168,880)

(23,239)

(1,173,483)

(583,898)

(80,347)

Proceeds from sale of property, equipment and software

4,292

3,506

660

6,796

4,166

573

Purchase of intangible assets, content and licensed copyrights

(283,321)

(188,821)

(399,533)

(54,978)

(1,110,003)

(588,354)

(80,960)

Net changes of short-term investments with terms of three
months or less

1,630,013

2,401,649

(8,194,289)

(1,127,572)

906,862

(5,792,640)

(797,094)

Proceeds from maturities of short-term investments with terms
over three months

–

104,269

–

Investment in long-term investments and acquisition of
subsidiaries

(270,228)

(481,804)

(193,450)

(26,620)

(1,499,276)

(675,254)

(92,918)

Proceeds from disposal of long-term investments, businesses
and subsidiaries

16,531

85,456

840,649

115,677

57,811

926,105

127,436

Placement/rollover of matured time deposits

(10,874,831)

(34,558,836)

(61,775,606)

(8,500,606)

(47,194,934)

(96,334,442)

(13,256,060)

Proceeds from maturities of time deposits

21,918,791

46,048,382

55,211,839

7,597,402

44,251,140

101,260,221

13,933,870

Change in other long-term assets

(31,189)

(34,625)

(172,543)

(23,743)

(152,030)

(207,168)

(28,507)

Net cash provided by/(used in) investing activities

11,589,514

12,859,889

(14,851,153)

(2,043,588)

(5,802,848)

(1,991,264)

(274,007)

Cash flows from financing activities:

Net changes from loans with terms of three months or less

(14,970,935)

(399,726)

(2,085,053)

(286,913)

(12,332,895)

(2,484,779)

(341,917)

Proceeds of loans with terms over three months

2,171,541

6,998,250

1,069,020

147,102

3,451,100

8,067,270

1,110,093

Payment of loans with terms over three months

(3,233,500)

(957,000)

(10,681,827)

(1,469,868)

(3,273,922)

(11,638,827)

(1,601,556)

Net amounts received related to capital contribution from
noncontrolling interests shareholders

22,228

42,214

50,572

6,959

46,577

92,786

12,768

Cash paid for repurchase of NetEase’s ADSs/purchase of
subsidiaries’ ADSs and shares

(2,195,210)

(1,233,780)

(2,007,030)

(276,177)

(4,311,967)

(3,240,810)

(445,950)

Dividends paid to NetEase’s shareholders

(2,119,316)

(4,945,016)

(2,264,799)

(311,647)

(3,331,656)

(7,209,815)

(992,104)

Net cash used in financing activities

(20,325,192)

(495,058)

(15,919,117)

(2,190,544)

(19,752,763)

(16,414,175)

(2,258,666)

Effect of exchange rate changes on cash, cash equivalents and
restricted cash held in foreign currencies

(47,876)

(43,138)

8,234

1,133

(32,378)

(34,904)

(4,803)

Net (decrease)/increase in cash, cash equivalents and restricted cash

(1,105,149)

21,878,862

(24,230,204)

(3,334,188)

(11,908,913)

(2,351,342)

(323,556)

Cash, cash equivalents and restricted cash, at the beginning
of the period

16,784,561

24,206,658

46,085,520

6,341,579

27,588,325

24,206,658

3,330,947

Cash, cash equivalents and restricted cash, at end of the period

15,679,412

46,085,520

21,855,316

3,007,391

15,679,412

21,855,316

3,007,391

Supplemental disclosures of cash flow information:

Cash paid for income taxes, net

1,625,045

1,182,711

2,848,493

391,966

2,699,624

4,031,204

554,712

Cash paid for interest expenses

326,646

146,455

152,943

21,046

602,360

299,398

41,199

The accompanying notes are an integral part of this announcement.

NETEASE, INC.

UNAUDITED SEGMENT INFORMATION

(in thousands, except percentages)

Three Months Ended

Six Months Ended

June 30,

March 31,

June 30,

2023

2024

2023

2024

RMB

USD (Note 1)

RMB

USD (Note 1)

Net revenues:

Games and related value-added services

18,798,646

21,460,378

20,055,819

2,759,772

38,864,243

41,516,197

5,712,819

Youdao

1,206,634

1,391,859

1,321,721

181,875

2,369,904

2,713,580

373,401

Cloud Music

1,948,539

2,029,541

2,040,952

280,844

3,908,380

4,070,493

560,118

Innovative businesses and others

2,057,482

1,969,963

2,067,313

284,472

3,915,061

4,037,276

555,548

Total net revenues

24,011,301

26,851,741

25,485,805

3,506,963

49,057,588

52,337,546

7,201,886

Cost of revenues:

Games and related value-added services

(6,122,836)

(6,555,311)

(6,008,604)

(826,812)

(12,805,884)

(12,563,915)

(1,728,853)

Youdao

(639,459)

(710,356)

(684,942)

(94,251)

(1,200,879)

(1,395,298)

(191,999)

Cloud Music

(1,422,855)

(1,259,006)

(1,385,756)

(190,686)

(2,943,233)

(2,644,762)

(363,931)

Innovative businesses and others

(1,450,738)

(1,311,148)

(1,364,285)

(187,732)

(2,835,633)

(2,675,433)

(368,152)

Total cost of revenues

(9,635,888)

(9,835,821)

(9,443,587)

(1,299,481)

(19,785,629)

(19,279,408)

(2,652,935)

Gross profit:

Games and related value-added services

12,675,810

14,905,067

14,047,215

1,932,960

26,058,359

28,952,282

3,983,966

Youdao

567,175

681,503

636,779

87,624

1,169,025

1,318,282

181,402

Cloud Music

525,684

770,535

655,196

90,158

965,147

1,425,731

196,187

Innovative businesses and others

606,744

658,815

703,028

96,740

1,079,428

1,361,843

187,396

Total gross profit

14,375,413

17,015,920

16,042,218

2,207,482

29,271,959

33,058,138

4,548,951

Gross profit margin:

Games and related value-added services

67.4 %

69.5 %

70.0 %

67.0 %

69.7 %

Youdao

47.0 %

49.0 %

48.2 %

49.3 %

48.6 %

Cloud Music

27.0 %

38.0 %

32.1 %

24.7 %

35.0 %

Innovative businesses and others

29.5 %

33.4 %

34.0 %

27.6 %

33.7 %

The accompanying notes are an integral part of this announcement.

NETEASE, INC.

NOTES TO UNAUDITED FINANCIAL INFORMATION

Note 1: The conversion of Renminbi (RMB) into United States dollars (USD) is based on the noon buying rate of USD1.00 = RMB7.2672 on the last trading day of June 2024 (June 28, 2024) as set forth in the H.10 statistical release of the U.S. Federal Reserve Board. No representation is made that the RMB amounts could have been, or could be, converted into US$ at that rate on June 28, 2024, or at any other certain date.

Note 2: Share-based compensation cost reported in the Company’s unaudited condensed consolidated statements of comprehensive income is set out as follows in RMB and USD (in thousands):

Three Months Ended

Six Months Ended

June 30,

March 31,

June 30,

2023

2024

2023

2024

RMB

USD (Note 1)

RMB

USD (Note 1)

Share-based compensation cost included in:

Cost of revenues

193,001

254,935

319,949

44,026

396,515

574,884

79,107

Operating expenses

Selling and marketing expenses

31,069

17,869

42,865

5,898

63,422

60,734

8,357

General and administrative expenses

281,326

289,636

286,350

39,403

575,607

575,986

79,258

Research and development expenses

282,466

331,860

429,892

59,155

574,731

761,752

104,821

The accompanying notes are an integral part of this announcement.

Note 3: The financial information prepared and presented in this announcement might be different from those published and to be published by NetEase’s listed subsidiary to meet the disclosure requirements under different accounting standards requirements.

Note 4: The unaudited reconciliation of GAAP and non-GAAP results is set out as follows in RMB and USD (in thousands, except per share data or per ADS data):

Three Months Ended

Six Months Ended

June 30,

March 31,

June 30,

2023

2024

2023

2024

RMB

USD (Note 1)

RMB

USD (Note 1)

Net income attributable to the Company’s shareholders

8,242,767

7,633,946

6,758,749

930,035

14,997,401

14,392,695

1,980,499

Add: Share-based compensation

774,683

876,898

1,059,939

145,852

1,586,283

1,936,837

266,518

Non-GAAP net income attributable to the Company’s shareholders

9,017,450

8,510,844

7,818,688

1,075,887

16,583,684

16,329,532

2,247,017

Non-GAAP net income per share *

Basic

2.80

2.65

2.43

0.33

5.15

5.08

0.70

Diluted

2.78

2.62

2.41

0.33

5.10

5.03

0.69

Non-GAAP net income per ADS *

Basic

14.01

13.25

12.15

1.67

25.75

25.40

3.49

Diluted

13.88

13.10

12.05

1.66

25.49

25.15

3.46

* Each ADS represents five ordinary shares.

The accompanying notes are an integral part of this announcement.

Note 5: Reconciliation between U.S. GAAP and International Financial Reporting Standards

The unaudited condensed consolidated financial information is prepared in accordance with U.S. GAAP, which differ in certain respects from International Financial Reporting Standards (“IFRSs”). The effects of material differences between the unaudited condensed consolidated financial information prepared under U.S. GAAP and IFRSs (“Reconciliation Statement”) are as follows in RMB (in thousands).

PricewaterhouseCoopers, the auditor of the Company in Hong Kong, has performed a limited assurance engagement on the Reconciliation Statement in accordance with International Standard on Assurance Engagements 3000 (Revised) “Assurance Engagements Other Than Audits or Reviews of Historical Financial Information”.

Reconciliation of unaudited condensed consolidated statements of income (Extract):

For the Six Months Ended June 30, 2023 IFRSs adjustments

Amounts as
reported under U.S.
GAAP

Investments measured at fair
value

Redeemable
noncontrolling interests

Amounts as
reported under
IFRSs

(Note (a))

(Note (b))

Investment income, net

759,059

694,453

–

1,453,512

Income before tax

17,210,658

694,453

–

17,905,111

Income tax

(2,340,649)

15,289

–

(2,325,360)

Net income

14,870,009

709,742

–

15,579,751

Accretion of redeemable noncontrolling interests

(1,728)

–

1,728

–

Net loss attributable to noncontrolling interests and
redeemable noncontrolling interests

129,120

–

(3,879)

125,241

Net income attributable to the Company’s shareholders

14,997,401

709,742

(2,151)

15,704,992

For the Six Months Ended June 30, 2024 IFRSs adjustments

Amounts as
reported under U.S.
GAAP

Investments measured at fair
value

Redeemable
noncontrolling interests

Amounts as
reported under
IFRSs

(Note (a))

(Note (b))

Fair value changes of redeemable noncontrolling interests

–

(571)

Investment income, net

282,965

(108,548)

–

174,417

Income before tax

17,417,805

(108,548)

(571)

17,308,686

Income tax

(2,786,849)

7,127

–

(2,779,722)

Net income

14,630,956

(101,421)

(571)

14,528,964

Accretion of redeemable noncontrolling interests

(1,918)

–

1,918

–

Net income attributable to noncontrolling interests and
redeemable noncontrolling interests

(236,343)

–

571

(235,772)

Net income attributable to the Company’s shareholders

14,392,695

(101,421)

1,918

14,293,192

Reconciliation of unaudited condensed consolidated balance sheets (Extract):

As of December 31, 2023 IFRSs adjustments

Amounts as
reported under U.S.
GAAP

Investments measured at fair
value

Redeemable
noncontrolling interests

Amounts as
reported under
IFRSs

(Note (a))

(Note (b))

Other long-term assets

28,471,568

(15,673,947)

–

12,797,621

Financial assets at fair value through profit or loss

–

18,369,496

–

18,369,496

Total Assets

185,924,978

2,695,549

–

188,620,527

Financial liabilities at fair value through profit or loss

–

37,961

Deferred tax liabilities

2,299,303

29,886

–

2,329,189

Total Liabilities

57,840,897

29,886

37,961

57,908,744

Redeemable noncontrolling interests

115,759

–

(115,759)

–

Total equity

127,968,322

2,665,663

77,798

130,711,783

Total liabilities, redeemable noncontrolling interests
and shareholders’ equity

185,924,978

2,695,549

–

188,620,527

As of June 30, 2024 IFRSs adjustments

Amounts as
reported under U.S.
GAAP

Investments measured at fair
value

Redeemable
noncontrolling interests

Amounts as
reported under
IFRSs

(Note (a))

(Note (b))

Other long-term assets

27,627,257

(14,942,321)

–

12,684,936

Financial assets at fair value through profit or loss

–

17,529,322

–

17,529,322

Total Assets

183,342,621

2,587,001

–

185,929,622

Financial liabilities at fair value through profit or loss

–

38,532

Deferred tax liabilities

1,448,781

22,759

–

1,471,540

Total Liabilities

48,997,216

22,759

38,532

49,058,507

Redeemable noncontrolling interests

119,498

–

(119,498)

–

Total equity

134,225,907

2,564,242

80,966

136,871,115

Total liabilities, redeemable noncontrolling interests
and shareholders’ equity

183,342,621

2,587,001

–

185,929,622

Notes:

Basis of Preparation

The Company is responsible for preparation of the Reconciliation Statement in accordance with the relevant requirements of the Hong Kong Listing Rules and relevant guidance in HKEX-GL111-22. The Reconciliation Statement was prepared based on the Company’s unaudited condensed consolidated financial information for the six months ended June 30, 2024 prepared under U.S. GAAP, with material adjustments made (if any) thereto in arriving at the unaudited financial information of the Company prepared under IFRSs. The adjustments reflect the material differences between the Company’s accounting policies under U.S. GAAP and IFRSs.

Note a. Investments measured at fair value

Under U.S. GAAP, the investments in convertible redeemable preferred shares and ordinary shares with preferential rights that are issued by privately-held companies and therefore without readily determinable fair values could be accounted for using measurement alternative as an accounting policy choice. NetEase elected the measurement alternative to record these investments at cost, less impairment, and plus or minus subsequent adjustments for observable price changes.

Under IFRSs, these investments were classified as financial assets at fair value through profit or loss and measured at fair value with changes in fair value recognized through profit or loss.

Note b. Redeemable noncontrolling interests

Under U.S. GAAP, SEC guidance provides for mezzanine-equity (temporary equity) category in addition to the financial liability and permanent equity categories. The purpose of this “in-between” category is to indicate that a security whose redemption is outside the control of the issuer may not be classified as a permanent part of equity. NetEase classified the redeemable preferred shares issued by certain subsidiaries as redeemable noncontrolling interests in the condensed consolidated balance sheets and recorded them initially at fair value, net of issuance costs. NetEase recognized accretion to the respective redemption value of the redeemable preferred shares over the period starting from issuance date to the earliest redemption date.

Under IFRSs, there is no concept of mezzanine or temporary equity classification. NetEase designated the redeemable preferred shares as financial liabilities at fair value through profit or loss which are measured at fair value. Subsequent to initial recognition, the amounts of changes in fair value that were attributed to changes in credit risk of the issuer were recognized in other comprehensive income, and the remaining amounts of changes in fair value were recognized in the profit or loss.

View original content:https://www.prnewswire.com/news-releases/netease-announces-second-quarter-2024-unaudited-financial-results-302228472.html

SOURCE NetEase, Inc.

Technology

Data Center Asia 2025 Set for Ground-breaking Launch in Hong Kong

Published

50 mins ago

September 23, 2024

HONG KONG, Sept. 22, 2024 /PRNewswire/ — Positioned as an essential knowledge exchange platform and a cross-continental meeting place for the industry, Data Center Asia (DCA), organized by Informa Markets Asia, is set to make its grand debut from 15 to 17 July 2025 at AsiaWorld-Expo, Hong Kong. Building on the success of the long-running, AFCOM-affiliated Data Center World event in the US, Data Center Asia will serve as the epicenter for data center technology innovations and business transformations in the fast-growing Asia-Pacific markets, with highlights to the regional hotspots such as the Greater Bay Area (GBA). Hong Kong as a prime event location allows the event to attract a diverse visitor mix across Asia-Pacific region and boost the connectivity with global markets.

By showcasing the end-to-end data center value chain, DCA 2025 promises to be a transformative moment for Asia’s data center ecosystem, offering unparalleled opportunities for education, networking and sourcing that will shape the future of digital infrastructure. The event will be co-located with Build4Asia, The Battery Show Asia and Mobility Tech Asia, bringing content and visitor synergies under a broad renewable energy theme that covers advanced battery technologies, energy storage, electric/hybrid technologies, green facilities and green building solutions, and other relevant subjects.

The Ultimate Showcase of Data Center Innovations

The three-day DCA 2025 will showcase hundreds of advanced solutions designed to help attendees refine their data center strategies. Exhibitors will span the entire data center industry ecosystem, bringing together every key element from data center infrastructure, design engineering and systems integration, intelligent products and technologies, cloud and virtualisation to telecommunications. Corporate users and industry professionals including data center operators, IT and infrastructure managers, facility managers, cloud service experts, cybersecurity specialists and sustainability advocates will have the opportunity to connect with top-tier global suppliers, explore the latest technologies, and rethink the full lifecycle of data center operations.

Held alongside the exhibition, The DCA conference will feature a series of expertly curated tracks, each focused on the latest trends and best practice in the industry. Featuring over 100 top-tier speakers across the region and from outside Asia, attendees will engage in in-depth discussions on key topics such as the current market landscape, energy efficiency & sustainability, data center design & operations, among many others. This dynamic exchange of ideas will inject new energy into the data center communities, offering attendees invaluable insights and practical takeaways.

Hong Kong as a Springboard to China and the Wider Asian Markets

Strategically located in the heart of Asia, Hong Kong bridges between Mainland China and the rest of the world, offering unmatched access for foreign businesses to enter the burgeoning GBA and the wider China markets and meanwhile enabling China local enterprises to expand their global footprint. Situated at AsiaWorld-Expo, which is conveniently located next to the Hong Kong International Airport and near the Hong Kong-Zhuhai-Macao Bridge, DCA 2025 ensures seamless access for visitors from all directions, making it an ideal platform to foster global connections and explore trans-continental business opportunities.

Hong Kong is distinguished by its superior connectivity, deep talent pool and advanced hardware infrastructure that complement the essential needs of the data center industry. The city’s commitment to supporting this sector is evident in its significant government initiatives, including subsidies for relevant R&D projects and the redevelopment initiatives to convert industrial buildings into the state-of-the-art data centers. These efforts are also complemented by Hong Kong’s strong supply-demand dynamics within key industries such as finance, trade, insurance and logistics, which drive lasting and robust needs for data center solutions. All these offer a fertile environment for investment and growth to the data center.

Strategic Co-Location for Maximum Synergy

As a strategic move to create powerful synergies, DCA 2025 will be co-located with three other technology-focused events held across seven standard halls at AsiaWorld-Expo:

the locally acclaimed Build4Asia, which specializes in green building, smart facilities and efficient power managementthe inaugural edition of The Battery Show Asia, which showcases the advancements in advanced battery and energy storage technologiesthe newly created Mobility Tech Asia, which explores the future of new energy vehicles across land, air and water.

This co-location is set to attract a diverse audience encompassing regional professionals from Internet Data Center (IDC) experts, EPC contractors, data center infrastructure manufacturers and distributors, end users and more, which would offer a broader perspective on data applications and drive valuable cross-sector exchange.

In addition, leveraging Informa’s extensive technology media network including Data Center Knowledge, InformationWeek, Network Computing and OMdia, DCA 2025 will serve up unprecedented opportunities for networking, knowledge exchange and business collaborations. The extensive industry expertise and audience base brought by these sister brands will significantly enhance the event’s global impact and educational value.

Join Us to Shape the Future of Data Center

Data Center Asia 2025 is set to be a premier destination for business networking and knowledge exchange and an industry-leading think tank. The event will cultivate a vibrant community of researchers, business leaders, industry associations and opinion makers, all of whom will contribute ground-breaking insights that could make a lasting impact on Asia’s data center industry. Join us in Hong Kong from 15 to 17 July 2025 and be a part of the conversation that will shape the future of Asian data center industry!

About Informa Markets

Informa Markets creates platforms for industries and specialist markets to trade, innovate and grow. Our portfolio is comprised of more than 550 international B2B events and brands in markets including Healthcare & Pharmaceuticals, Infrastructure, Construction & Real Estate, Fashion & Apparel, Hospitality, Food & Beverage, and Health & Nutrition, among others. We provide customers and partners around the globe with opportunities to engage, experience and do business through face-to-face exhibitions, specialist digital content and actionable data solutions. As the world’s leading exhibitions organizer, we bring a diverse range of specialist markets to life, unlocking opportunities and helping them to thrive 365 days of the year. For more information, please visit www.informamarkets.com.

View original content to download multimedia:https://www.prnewswire.com/news-releases/data-center-asia-2025-set-for-ground-breaking-launch-in-hong-kong-302255014.html

SOURCE Informa Markets Asia; Data Center Asia

Technology

On Track for A Low Carbon Future: CRRC to Unveil Passenger and Freight Rail Transit and Full Life-Cycle System Solutions at InnoTrans 2024

Published

2 hours ago

September 23, 2024

BERLIN, Sept. 22, 2024 /PRNewswire/ — Under the theme of On Track for A Low Carbon Future, CRRC Corporation Limited (“CRRC”, SHA: 601766) will display its line-up of passenger and freight transportation offerings, alongside full life-cycle system solutions, at InnoTrans 2024 in Berlin, Germany. Highlighting the event, two innovative, eco-friendly, and intelligent trains will make their world premiere: the CINOVA H2 New Energy Intelligent Intercity Train and the Autonomous Rail Rapid Transit (ART) 2.0, at Stand 210, Hall 4.2 of the venue.

Green Intelligent Passenger Transport Solutions

CRRC will showcase its environmentally responsible and intelligent passenger transport solutions, which include the Intelligent EMU, Intercity/Regional EMU, Intelligent Urban Rail Transit, and New Energy Passenger Transportation. These offerings cater to every speed level and application scenario, envisioning a future of passenger transport that is faster, greener, smarter, and more cost-effective.

The exhibition will highlight standout products that are redefining passenger mobility, including the 350 km/h High-Speed Intelligent EMU, the CINOVA 2.0 New Intelligent Intercity/Regional EMU, the 160 km/h Hydrogen Full-Automatic Intelligent Regional Train, and the Autonomous Rail Rapid Transit (ART).

Diversified Freight Transport Solutions

CRRC introduce a wide range of heavy-duty, fast, and environmentally responsible solutions during the event. To address the growing demand for higher freight capacity, CRRC plans to unveil several new products, among them, the 24-axle Freight Electric Locomotive and the 45-ton Axle Load Ore Car. The 350 km/h High-Speed Freight EMU, the fastest and the most spacious in the industry, will be a focal point. In line with the global push for green transportation, CRRC will launch its serialized new energy locomotives, including the diesel-battery hybrid locomotive, the power battery locomotive, and the hydrogen-battery hybrid locomotive, with power levels from 1000KW to 2000KW. The diversified solutions offer more choices for the global railway freight industry.

Full Life-Cycle System Solutions

CRRC will showcase its expertise beyond just train units with the Train-Ground Integrated Electromechanical System (TIES), a game-changer that centers on the vehicle and incorporates all related operating scenarios. The system reconstructs, integrates, and optimizes the electromechanical system for power supply, signaling, track, depot and passenger service scenarios. It exemplifies the Train-Ground Integration concept, driving overall efficiency gains across disciplines and throughout the entire vehicle-road-station-depot lifecycle.

Focusing on user experience and the diverse needs of the global rail transit market, CRRC will give a detailed presentation on its Digital Life-Cycle System Solution (DLS) at the event. The flexible solution accommodates various city sizes and populations through tailored system designs that support diverse business models such as PPP (public-private partnership), system integration, and electro-mechanical turnkey projects.

For more information about CRRC at the exhibition, please visit https://www.crrcgc.cc/en/.

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SOURCE CRRC Corporation Limited

Technology

Reshaping Future Lifestyles: Markor Unveils AI Strategy at the Apsara Conference

Published

2 hours ago

September 23, 2024

BEIJING, Sept. 21, 2024 /PRNewswire/ — On September 19, the 2024 China Apsara Conference, a major annual event for the Chinese cloud computing industry, commenced in Hangzhou. Over three days, industry representatives, media professionals, and numerous AI technology enthusiasts gathered to witness the event’s grandeur.

This year’s summit, themed “AI on Cloud: Recharging• Innovating • Transforming,” spotlighted the evolution of cloud computing across various sectors in the AI era, presenting the world’s largest showcase of generative AI applications. Industry giants including NVIDIA, Intel, Alibaba Cloud, and Tesla were in attendance. Markor distinguished itself as the sole home furnishing company represented at the summit, presenting its cutting-edge “AI Smart Home” system, which introduced a new era of AI-driven home consumption experiences, attracting significant attention.

Live at the Scene: Markor’s AI Smart Home Takes a Giant Leap Forward

From its transition to new retail in recent years to its embrace of AI, the home furnishing industry’s exploration and implementation of AI have drawn immense attention. It has been recognized as a long-term strategy that will influence the future of urban living and people’s quality of life.
In 2023, dubbed the first year of AI in China, Markor led the industry by launching its AI-powered home application, “AI Smart Home.” This program integrates cutting-edge AI model technology with a curated selection of best-selling products, offering features such as a home knowledge encyclopedia, lifestyle analysis and recommendations, design style suggestions, furniture recommendations, and one-click product replacements, providing users with 24/7 intelligent home design and easy home setup solutions.

The AI Smart Home system revolutionizes traditional home setup processes, enabling users to enjoy services conveniently via mobile devices. At the summit, Markor provided live demonstrations of the AI Smart Home system, with an interactive area for hands-on experiences. The system’s ease of use, wide range of style options, instant results, one-click sharing, and seamless purchasing capabilities ushered in a new era, allowing attendees to transition from imagining AI-powered home setups to instantly experiencing full-room services. The audience was left impressed and full of praise.

As the world’s first AI multimodal model for professional interior design, and the only AI application to incorporate a large language model in home furnishing retail, the AI Smart Home offers flexible and dynamic solutions that go beyond pre-existing layout-generated designs. It represents a groundbreaking leap in the home industry, emerging as a leading tool that reshapes service ecosystems.

Open, Shared, and Collaborative AI Business Achievements Define AI’s Sustainable Future

As a traditional home furnishing retailer closely tied to people’s daily lives, the success of AI Smart Home is no coincidence. Markor’s global strategy and presence ensure that the brand remains open and internationally competitive. Whether through prestigious awards or its global manufacturing footprint, each leap in innovation is supported by its competitive edge.
Since the beta launch of AI Smart Home by Markor Furnishings, a home furnishing brand under Markor, it has recorded over 50,000 page visits in a short time, with tens of thousands of users generating sales orders worth tens of millions of yuan. This achievement has boosted confidence in the traditional industry’s digital transformation.
A representative of Markor at the summit stated, “AI represents openness, and Markor has always embraced the times through an open ecosystem to meet users’ needs. With over 20 years of accumulated lifestyle experience, we aim to extend the reach of quality living experiences through AI interaction and expansion. The true sustainable future of AI lies in achieving shared success among users, brands, and technology platforms.”

It is evident that Markor is not simply focused on app development; it is committed to a long-term strategy that builds AI-driven lifestyles and reshapes business models. By creating personalized shopping experiences and innovating marketing models that cater to new consumer demands, Markor’s AI-based tools like “AI Xiaomei” and “AI Smart Home” serve as personalized recommendation and virtual design solutions. The company is poised to further enhance its services by leveraging AI to accurately predict market trends, optimize advertising effectiveness, and upgrade customer solutions, thus driving marketing conversion opportunities. Through disruptive shopping experiences and business models, Markor aims to become the world’s first AI-driven home furnishing brand with a fully digital and intelligent shopping experience.

Pioneering Future Living with AI: Unlocking New Opportunities

Markor is committed to leveraging technological convenience, unlocking potential, and sharing technological benefits. As a trailblazer in quality living, its development path consistently follows a “science + art” approach, which has proven to be a long-term strategy in line with current market trends. In 2024, Markor was honored with the title of “Outstanding Home Furnishing Brand Enterprise of 2024.” Its sub-brand, Markor Furnishings, reached a new brand value of over 32.2 billion yuan, securing a spot in the “Top 100 New Quality Home Brands of 2024” and winning the “Home Service Excellence Award” for the 13th consecutive year.
Backed by its national-level Industrial Design Center, robust R&D systems, and global operational capabilities, Markor continues to invigorate the ecosystem through digitalization, intelligence, and supply chain integration. With AI Smart Home as the bridge, Markor is reigniting public interest and confidence in AI’s potential and advancing the commercialization of AI technologies like natural language processing. It is building a continually open-source platform for both DTC end-users and B2B interior designers.
In July 2024, Markor hosted the “Art + AI + Life” forum in Beijing and launched a national AI painting and design competition, further embedding AI practices in the industry. In September, it signed a strategic partnership with the AI technology leader Shengshu Technology to break new ground in product design, manufacturing, marketing content innovation, and service experience. This collaboration will fuel the company’s efforts toward smart, personalized home furnishing upgrades, setting new benchmarks in the industry. These initiatives underscore Markor’s determination to use AI to enhance its future competitiveness.

Democratizing design empowers everyone to shape their dreams and take control of their future. Markor’s ongoing AI strategy not only provides opportunities for those pursuing a better life but also highlights new possibilities in the ever-evolving home living landscape.

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SOURCE Markor International Home Furnishings