Core views
On the evening of May 20, 2024, NetEase held its annual game press conference. At this conference, NetEase announced product updates for more than 40 games, including expectations for new games and updates for old games. Among them, a number of major new games were unveiled, such as “Eternity”, “16 Sounds of Fire”, and “Firefly Assault”; new game products continue to launch major IPs, MMOs, and competitive categories this year. As many new game blockbusters are launched one after another, the NetEase game business is expected to continue to improve in 2024.
Brief review
NetEase 520 game conference launches many blockbuster games
On the evening of May 20, 2024, NetEase held its annual game press conference. At this conference, NetEase announced product updates for more than 40 games, including new game expectations and updates to old games. Among them, a number of major new games have been unveiled, and six major games may have been in public beta in '24. Typical blockbuster games include:
1) “The Sixteen Sounds of Yan Yun”: A self-developed open world martial arts game that innovatively combines open world and Chinese martial arts. It is NetEase's first full-platform masterpiece developed with 3A technical specifications; the game is expected to be released on 7.26, and will also be available on mobile, PC, and console;
2) “Firefly Assault”: It is a survival mobile game developed by NetEase. The game has unique tactical gameplay. Players can customize their fighting style, and they can avoid enemies or win; the game is expected to go into public beta on 6.6;
3) “Shattered Land”: A Chinese-style wasteland-themed adventure shooter developed by NetEase. The game is mainly PVE, supplemented by PVP. The core experience is treasure hunting and development. Testing is expected to begin on 5.24.
4) “Eternity”: The mobile game version has been popular all over the world since its launch in 2021. Currently, it is still very popular, with over 40 million players worldwide and more than 25 million mobile game reservations; the mobile game version began its first test in April of this year. It is expected that the screen of the subsequent mobile game version will be fully upgraded, and more martial arts moves and map ecology will be added. It is expected that Q2 may be launched.
In addition to the above products, the new game console also showcased “Marvel's Ultimate Reversal”, “Jiugi: Qifeng Journey”, “Operation Apocalypse”, “Assault: Shadow Legends”, “Dragon's Realm”, “Brave Fist”, and “Seven Day World”; six of these models may be in public beta during the year; this year's products will continue to launch major IPs, MMO, and competitive categories. We are optimistic that the new game will contribute more to NetEase.
In addition to new games, NetEase has also updated the dynamics and future adjustments of many old games. Among them, “Egg Boy Party” is scheduled to start its anniversary on June 14, and the Elf Raise Abby gameplay is also planned to be launched. In addition, it also includes blockbusters such as “Lord of the Rings: Dispute”, “The Stranger: Conqueror of the Continent”, “Defying the Cold”, “Peak Speed”, and “All-Star Street Ball Party.”
Risk warning:
1) The risk that the company's overall revenue and adjusted net profit fall short of market expectations; the risk of a decline in operating profit due to a sharp increase in the company's marketing expenses due to increased competition; the risk that the revenue of the Dao and Cloud Music business will fall short of expectations; the risk that the mobile game business version falls short of expectations; the risk that the flow performance of new games will fall short of expectations; the risk that some old games have entered a period of decline; 3) The risk of increased competition in the industry, the risk of rising purchasing costs, the risk of shrinking game trial production scale, and policies for games The risk of tightening regulations, the risk of rising game production and distribution costs; 4) The risk that profits fall short of expectations due to declining mobile game traffic.