Hong Kong–listed XD Inc. (XD) reported mixed interim results for the six months ended 30 June 2026. Group revenue increased 7.5% year on year (YoY) to RMB 3.31 billion (USD 460 million), driven by solid growth in self-developed titles and premium game launches. However, higher distribution commissions, cloud expenses and tax charges pushed profit for the period down 10.6% to RMB 724.31 million (USD 100 million).
Game operations remained the principal earnings engine, contributing 70% of total revenue. Game revenue climbed 11.9% YoY to RMB 2.32 billion, buoyed by the global rollout of life-simulation title “Heartopia” and continued momentum at “Torchlight: Infinite”; the newly published MMORPG “Blue Protocol: Star Resonance” added incremental sales. Premium game revenue surged 30.9% to RMB 82.53 million, led by the mobile launch of “Dave the Diver”.
TapTap, the group’s game-distribution and community platform, generated RMB 0.99 billion, broadly flat YoY (-1.6%). While TapTap’s mainland China monthly active users (MAUs) expanded 4.1% to 45.40 million, international MAUs slipped 37.9% to 3.12 million amid limited overseas monetisation.
Cost of revenue rose 18.5% to RMB 982.95 million, reflecting higher platform commissions, server costs and amortisation linked to the December 2025 acquisition of the “Torchlight” intellectual property. Consequently, group gross margin narrowed to 70.3% from 73.1%. Selling and marketing expenses grew 3.4% to RMB 769.50 million, aligned with revenue growth, while research and development spending increased 16.5% to RMB 639.23 million following intensified investment in AI-related projects such as TapTap Maker and the open-sourced “Cindy” office agent.
Operating profit slipped 1.8% to RMB 846.12 million; adjusted profit fell 8.1% to RMB 783.51 million after adding back RMB 59.20 million in share-based compensation. EBITDA stood at RMB 862.74 million, little changed YoY, with adjusted EBITDA at RMB 921.93 million.
Cash and short-term investments totalled RMB 3.90 billion at 30 June 2026, up from RMB 3.77 billion at year-end 2025, supported by RMB 711.90 million in operating cash flow. The company executed share repurchases of 7.88 million shares for HKD 493.21 million during the period; gearing remained steady at 22.5%.
Key user metrics remained healthy for core titles: online-game average MAUs rose 10.0% YoY to 12.55 million and average MPUs gained 8.9% to 1.44 million. XD operated 23 online and 52 premium titles at period-end, with three additional online games under development.
No interim dividend was declared. Post-period events include a July grant of 85,894 share options, 61,376 of which were awarded to Chairman and CEO Huang Yimeng, and the exercise of 800 options by employees. The company confirms full compliance with Hong Kong’s Corporate Governance Code aside from the ongoing dual role of chairman and CEO held by Mr. Huang.
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