On August 22nd, NetEase released its Q2 2024 financial report. According to the financial report, NetEase's revenue in the second quarter was 25.5 billion yuan, a year-on-year increase of 6%. The net profit attributable to the company's shareholders under non GAAP accounting standards was 7.8 billion yuan, and the performance maintained steady growth. During the quarter, the R&D investment was 4.5 billion yuan, with a R&D investment intensity of over 17%, leading the industry.
In the second quarter of this year, NetEase's gaming and related value-added services revenue was 20.1 billion yuan; NetEase Cloud Music has a revenue of 2 billion yuan, and the commercialization of its core online music business maintains a healthy momentum; NetEase Youdao achieved a revenue of 1.3 billion yuan and a record high net inflow of operating cash flow, making positive progress in the commercialization of AI; The revenue of the innovation sector is 2.1 billion yuan.
As of the second quarter, NetEase has invested over 15% in research and development for eight consecutive quarters. In the second quarter, NetEase invested 4.5 billion yuan in research and development, with an investment intensity of over 17%. Its major models such as "Ziyue" and "Yisheng Zhuxiang" are accelerating their sinking and deepening implementation, and have completed large-scale applications in core businesses and high-frequency scenarios.
In terms of "AI+gaming", NetEase's AI technology is not limited to cost reduction and efficiency improvement on the production side, but also creates a new ecosystem through "AIGC+UGC". With the "AI teammate" function first launched by the mobile game "Forever", the relevant content on the Tiktok platform has exceeded 500 million times; All kinds of playing methods of "Cold Against the Water" AI blessing have greatly stimulated players' enthusiasm for creation. In June, the total number of play times of Duanyou reached 100 billion in Tiktok.
In terms of "AI+Education", NetEase Youdao has made positive progress in the commercialization of AI, driving the overall performance to continue to grow steadily. The "Confucius" education model has been gradually implemented in the software and hardware products of the entire department, and the commercialization effect has begun to show results. The sales of AI subscription services have increased by nearly 200% year-on-year.
In addition to deepening the application of AI technology in core businesses, NetEase is also actively exploring new application scenarios such as industry and risk control. At the World Artificial Intelligence Conference, NetEase Fuxi released its first robot brand "Lingdong", which includes two core products: mining robots and loading robots. It has participated in 50 key construction projects in more than 10 provinces, covering various application scenarios such as mines, ports, mixing plants, and schools; NetEase Yidun has released the first vertical security model in China that focuses on digital content risk control scenarios. The recognition rate of AIGC facial stylized difficult cases has reached over 90%.
NetEase CEO Ding Lei stated that innovation has always been the primary goal of the company's development. NetEase will continue to expand its product line and domestic and international markets with strong research and development and operational capabilities, high-quality and diversified content, and bring exciting content and experiences to global users.