NetEase, Inc. (NASDAQ:NTES) Q4 2023 Earnings Call Transcript

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Lincoln Kong: [Foreign Language] So I will translate myself. My first question is about where we meet. So with our target to launch timeline for this game. It will be a cross-platform global launch for this time. And it seems, during the testing, it requires quite high equipment for the PC world. So would that affect the mobile world in terms of the gameplay and the components? How would that fit in both PC and mobile? And the second question is around the overall market. We do see some of the uncertainty around the macro economy and consumption going forward into 2024. So in those longer-term legacy games like Westfall Journey, and Westfall, do we see any of the change in terms of the user spending behavior or paying willingness on those games? What’s our outlook for this year’s gaming industry?

Bill Pang: [Foreign Language] Thank you. I will do the translation. First of all, regarding your question to where Winds Meet. Where Winds Meet, as we explained, is the game we spent three years developing is a very high-quality martial arts-based open-world RPG game. Regarding the specific graphic question, that’s something you don’t need to worry about and players don’t need to worry about either. Our engine has the capability to adapt on different hardware platforms to push the limit of that specific hardware but also make sure it’s runnable on different platforms. So that’s been taken care of by our in-house game engine and everything. In the meantime, for the game itself, it’s indeed a high-graphic game on advanced hardware platforms.

Also, from our experience, we saw people like the Wuxia culture like to play the game and we hope this game could be a vehicle that we could promote the Wuxia culture to the world as well. And to your second question regarding the macroeconomy uncertainties, how will that impact the game performance? From our observation, actually, gamers, they spend pretty prudently how much they spend in different games to get the fun they are pursuing. From our experience, it’s not very related to macroeconomic conditions. It’s actually more related to the quality of the game itself. Now, as we said, the gamers, not only in China, but globally, become more and more picky regarding the quality, which puts all the developers included to spend more and more effort to making high-quality content.

Yes, that’s kind of the game industry macro we’re in. Thank you. And next question, please. I think we have time for one last question.

Operator: Thank you. Your last question comes from Ritchie Sun with HSBC.

Ritchie Sun: [Foreign Language] So I will translate this question myself. So [Indiscernible] will be launched in March, and [Indiscernible] can be launched in the first half. So in terms of the user demographics, how big is the overlapping between these games and our existing games? And how would NetEase coordinate the promotion and launch schedule to maximize the hit rate? And when will [Indiscernible] be launched? Thank you.

Bill Pang: [Foreign Language] So regarding your question on the two different martial arts-based games, these two games have totally different IP attributes. One is very loved by Jin Yong fans. The other one is more like an Asian reality kind of setup. And both games are developed by different teams with different art styles, different system setups. We don’t see that the game is going to have a lot of collaboration with other games. And actually, our view is the market is actually looking for high-quality martial arts, open-world games. And by offering two high-quality martial arts games in the market with different positioning, we hope we can push the market further. And on the go-live date, everything is being prepared. Everything is on track. And yes, everything is on track. Thank you.

Operator: And that concludes the question-and-answer session. I would like to turn the conference back over to Brandi Piacente for any additional or closing comments.

Brandi Piacente: Thank you once again for joining us today. If you have any further questions, please feel free to contact us and have a great day.

Bill Pang: Thank you.

Operator: That does conclude our conference for today. Thank you for participating. You may now disconnect.

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