NetDragon Websoft Holdings Limited reported FY2025 revenue of RMB4.48 billion, down 26.0% year-on-year, as weaker sales in both gaming and education technology outweighed gains from cost optimisation.
Gross profit declined 20.2% to RMB3.15 billion; however, gross margin expanded 5.1 percentage points to 70.3% on reduced production costs and a higher mix of digital-only sales. Group operating expenses fell 22.2% to RMB2.60 billion, supporting a second-half operating profit increase of 47.7% year-on-year.
Profit attributable to owners fell 51.4% to RMB151 million, primarily due to a cryptocurrency impairment and one-off staff optimisation costs. Excluding non-core items, core gaming profit slipped 3.0% to RMB897 million, while Mynd.ai posted a wider core loss of RMB358 million.
Segment performance • Gaming and application services contributed RMB3.28 billion, down 16.8%. Segment gross margin rose to 87.1%, and core profit margin improved 3.9 percentage points to 27.4% amid a 33.2% cut in R&D spend. • Mynd.ai revenue dropped 43.2% to RMB1.20 billion, reflecting sector-wide budget delays. Segment operating expenses decreased 21.1%, trimming second-half core loss by 12.4% year-on-year.
Balance sheet and liquidity Net cash and liquid investments stood at roughly RMB2.00 billion at year-end. Cash, bank deposits and pledged deposits totalled RMB3.94 billion. Total bank borrowings rose to RMB2.36 billion, pushing the gearing ratio to 0.44 from 0.29 a year earlier. Net current assets amounted to RMB1.13 billion.
Shareholder returns The board proposed a final dividend of HKD0.50 per share, maintaining full-year dividends at HKD1.00. Including share repurchases, the company met its August 2025 commitment to return at least HKD600 million to shareholders and pledged to distribute a further HKD600 million over the next 12 months.
Operational highlights • Average monthly active users for the Eudemons IP rose 11.1%, marking a fourth consecutive half-year of growth. • AI tools now handle 25% of total game development workload; management targets 50% by end-2026. • The AI Content Factory accelerated production of digital textbooks and courseware, helping cut segmental costs. • Strategic alliances were signed with ByteDance’s Volcengine, Thailand’s MHESI and Cameroon’s MINESEC to scale AIGC-based education solutions.
Outlook Management expects the full benefits of 2025 cost measures to materialise in 2026 and will prioritise AI-native game development, new game genres and overseas education partnerships to drive long-term growth and margin expansion.
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