NetEase Cloud Music Inc. Reports First Half 2025 Financial Results

HANGZHOU, China, Aug. 14, 2025 /PRNewswire/ -- NetEase Cloud Music Inc. (HKEX: 9899 or the "Company"), a leading interactive music streaming service provider in China, today announced its financial results for the first half of 2025 ended June 30, 2025.

Summary of Key Financial Metrics 

(RMB in thousands, unless otherwise stated)

Note:

(1)  During the period ended 30 June 2025, the Group recognised a deferred income tax credit of RMB849.4 million which primarily arose from the recognition of deferred tax assets in respect of cumulative tax losses incurred by a wholly-owned subsidiary. These tax losses are available to be carried forward against future taxable income. Deferred tax assets relating to tax losses and temporary differences are recognised to the extent that it is probable that future taxable profit will be available against which the temporary differences or tax losses can be utilised.

(2)  Adjusted operating profit and adjusted net profit are defined as operating profit and profit for the period attributable to the equity holders of the Company adjusted by adding back equity-settled share-based payments as appropriate. For details of the reconciliation of the operating profit and the profit for the period attributable to the equity holders of the Company to the adjusted operating profit and the adjusted net profit of our Group, see the section headed "Financial Review" below.

First Half 2025 Key Financial Highlights

• Revenue was RMB3.8 billion, a decrease of 6.0% compared with RMB4.1 billion for the same period of 2024.
  • Online music services:
    
    -Revenue from online music services was RMB3.0 billion, an increase of 15.9% compared with RMB2.6 billion for the same period of 2024.
    
    -Revenue from sales of membership subscriptions increased to RMB2.5 billion from RMB2.1 billion for the same period of 2024.
  • Social entertainment services and others:
    
    -Revenue from social entertainment services and others was RMB859.8 million, compared with RMB1,510.8 million for the same period of 2024. The decrease was mainly due to a more prudent operational approach for social entertainment services, along with a focused emphasis on core music business.
• Gross profit was RMB1,392.5 million, a slightly decrease of 2.3% compared with RMB1,425.7 million for the same period of 2024.
• Gross margin improved to 36.4% from 35.0% for the same period of 2024.
• Operating profit was RMB844.5 million, an increase of 40.8% compared with RMB599.9 million for the same period of 2024.
• Adjusted operating profit was RMB905.4 million, an increase of 35.0% compared with RMB670.9 million for the same period of 2024.
• Net profit reached RMB1,882.1 million, compared with net profit of RMB809.9 million for the same period of 2024.
• Adjusted net profit reached RMB1,946.4 million, compared with adjusted net profit of RMB880.7 million for the same period of 2024.

Business Overview

We entered 2025 with an unwavering commitment to driving quality development across our core music ecosystem. Throughout the period, we provided our community with an unparalleled music experience, successfully engaging more music lovers while enriching our unique content ecosystem and advancing the growth of original music. Our enhancements focused on premium offerings, including enhanced content, improved personalised distribution, more innovative features and reinforced community attributes, all of which boosted our appeal to users and deepened their engagement. Paired with advanced membership privileges, these initiatives also spurred growth in our subscription-based membership, improving our profitability.

We continued to engage users across our growing music-inspired community. Our total monthly active users (MAUs) maintained steady growth momentum in the first half of 2025, fuelled by an enhanced user experience and stronger brand influence. Meanwhile, our DAU/MAU ratio (daily active user/monthly active user ratio) grew steadily, consistently exceeding 30%. Users also spent more time listening to music on our mobile app, reflecting higher engagement. Our diverse initiatives focusing on premium content and user experiences, continue to attract music enthusiasts and convert them into loyal platform fans.

In the first half of 2025, we consistently enriched our unique content offerings by curating a diverse range of music tailored to our audience, while actively promoting original Chinese music. We further expanded our copyrighted content library, incorporating popular Korean music labels such as RBW and StarShip Entertainment, as well as works from renowned Chinese artists. We maintain a robust roster of independent artists and remain committed to fostering in-house music. Recently, several in-house tracks gained traction both internally and externally, such as "Liang Nan" (《 两难》).

In terms of product focus, we consistently enhance the premium music listening experience and refine personalised recommendations to meet the needs of our users. In the first half of 2025, we further upgraded our main product to make it more visually appealing, streamlined and user-friendly. We improved music discovery and consumption with advanced personalised distribution and innovative features, such as our "Magic Light Player" (神光播放器), for an excellent audio-visual experience. Besides, we strengthened our music-centric community by expanding and enhancing interactive scenarios that boost user activity and engagement.

During the first half of 2025, we focused on enhancing our music-centric monetisation, sustaining healthy growth. Subscription-based membership revenue increased by 15.2% compared to the same period last year, primarily driven by an increase in our subscriber base, though slightly offset by a dilution in monthly ARPPU (average revenue per paying user) due to changing subscriber mix. We rolled out various premium offerings, including expanded content and innovative features, as well as broadened membership benefits such as functional tools, social features and dress-up privileges. Notably, our rapidly growing subscriber base showed stronger engagement with higher retention rate during the Reporting Period.

We further improved our profitability during the first half of 2025. Our gross margin reached 36.4% for the first half of 2025, a notable increase from the same period in 2024, owing to our increased business scale, strong monetisation of our core online music business and ongoing cost optimisation.

Going forward, our focus will remain on delivering an even richer music experience and deepening user engagement across our platform by expanding access to high-quality content, innovating products and features, and nurturing our community. Our strategic priorities include the following initiatives:

• Further diversifying and enhancing our differentiated content offerings with greater efficiency. We plan to deepen our collaboration with copyright holders and strengthen our capabilities in independent artist incubation and in-house music production, focusing on our signature music genres;
• Meeting the needs of users by optimising the music listening experience and recommendation features, to deliver the ultimate music experience;
• Nurturing our music-oriented community ecosystem and exploring innovative inter-person interaction via enhancements to our comprehensive product offerings, including broadening communicative scenarios and ecology;
• Cultivating our users' willingness to pay and subscribe to premium offerings by improving user experience, deepening user engagement, enhancing membership privileges and broadening consumption scenarios; and
• Improving profitability through continued cost optimisation, operating efficiency enhancement and disciplined cost control.

Comprehensive and differentiated content ecosystem

We continually expand our unique content library, including both licensed tracks and original music. By supporting independent musicians and developing in-house music, we actively promote the growth of original Chinese music. We remain focused on promoting genres that resonate with our users, such as hip-hop.

Enhancing partnerships with copyright holders

Throughout the Reporting Period, we continued to strengthen partnerships with music copyright holders through a disciplined and collaborative approach.

• Expansive catalogue of music labels. In the first half of 2025, we expanded our music label catalogue, particularly through new partnerships with Korean labels and Chinese artists. We secured copyright agreements with popular K-Pop labels, such as RBW and StarShip Entertainment, enriching our K-Pop library with tracks from influential artists and groups. Additionally, we added works from renowned Chinese artists like Li Jian (李健), Lay Zhang (张艺兴), Chen Chusheng (陈楚生), Summer Jikejunyi (吉克隽逸), etc., featuring their popular tracks on the platform. We also expanded our collaboration with Jackson Wang (王嘉尔), introducing his two new hits, "High Alone" and "GBAD", in the first quarter of 2025.
• Amplifying offerings in signature music genres. We actively expanded our content library to enhance our platform's appeal to younger audiences, focusing on popular music genres like hip-hop, Japanese ACG, and Western music. We expanded content in those signature genres throughout the period, featuring new songs from rappers like KeyNG (杨和苏) and MaSiWei (马思唯), among others.
• In-depth collaborations with copyright partners. We successfully collaborated with copyright holders and artists, expanding our collaborative efforts in content distribution and commercialisation, which drove impressive sales of premium albums on our platform. Through these expanded collaborations, new albums from Hua Chenyu (华晨宇), David Tao (陶喆) and Allen Ren (任嘉伦) achieved impressive sales on our platform. We also facilitated the sales of physical album from popular artists, such as Ele Yan (颜人中) and BLACKPINK's Jennie and Lisa.

Strengthening our leading independent artists' ecosystem

We offer continuous support to independent artists, providing comprehensive assistance throughout their music creation journey. By June 2025, our platform had over 819,000 registered independent artists contributing 4.8 million music tracks to our library.

• Supporting musicians in content creation. We recently introduced two new roles for music creators on our platform: AI Musician (AI音乐人) and Trainee Musician (见习音乐人). These pathways provide fresh opportunities for budding music creators to grow and contribute to the diversity of our content creation ecosystem. We will provide ongoing guidance to nurture their growth and help them evolve into skilled musicians. Starting in 2021, we organized nine sessions of our signature offline songwriting camps, producing over 120 tracks that have collectively garnered more than 6 billion plays.
• Exploring and improving the exposure of musicians and their work. We recently participated in China's first hip-hop-themed exhibition, "Chengdu Hip-Hop Exhibition". By integrating offline experiences and online content such as "Chengdu Rap Map", we offered a comprehensive view of Chengdu's hip-hop music, and promoted high-quality content in our signature genre.
• Enhancing commercial resources for musicians. Through collaborations with musicians on our platform, we partnered with various brands to create themed songs and background music for advertising. This initiative boosts musicians' visibility and provides them with valuable commercial opportunities. Notable examples include tracks from Anzi & Jiumei (安子与九妹乐队), YUGO (羽果乐队), Zaliva-D, and COM'Z (康姆士乐队), featured in campaigns for ONVO, Salomon, Miu Miu, and Luckin Coffee, respectively.

Developing and promoting differentiated in-house music

Since the beginning of 2025, our in-house studios have successfully produced and popularised multiple hit songs across our community and external platforms. We emphasise our signature genres, such as hip-hop, and popularised multiple in-house hip-hop tracks during the Reporting Period, including "Liang Nan" (《两难》) and "Mo Chou Xiang" (《 莫愁乡》). Additionally, we are dedicated  to  cultivating  high-quality,  refined  music  content.  Older  self-produced  tracks,  such as "Shi Hao" (《嗜好》) and "You" (《你》), are gradually reaching a wider audience and gaining recognition, showcasing the enduring appeal and value of exceptional music.

Diversified audio-based content offerings

We have been actively expanding the long-form audio offerings on our platform. In the first half of 2025, consumption of our long-form audio content continuously increased, with the average listening time per user showing consistent improvement.

• PUGC/UGC – podcast. With our podcasts' focus on music-inspired content, they offer music fans an enjoyable way to discover quality and lesser-known songs. Our podcast "Dear Music – The season of New Voices" (《亲爱的音乐 • 宝藏新声季》), co-created with a radio DJ, delves into the stories behind hit songs by Chinese singer-songwriters and has surpassed 100 million plays. Our newly introduced "Music Neighbour Program" (音乐友邻计划) features KOLs such as Lo Ta-yu (罗大佑) and Terry Lin (林志炫), who host exclusive music podcasts and share their personal music playlists with listeners.
• PGC – audiobooks & radio dramas. We have been expanding our library of PGC long-form audio content cost-effectively. During the Reporting Period, our self-produced audiobooks, such as《大师兄明明是酒鬼怎么会这么强》and《黑相术》, have become new hits on our platform. We also introduced high-quality content, such as our in-depth collaboration with Pu Yixing (蒲熠星) on his new audiobook "Someone Fell from the Forest" (《有人自林中坠落》).

Product innovation and community ecosystem

During the Reporting Period, we continued to elevate users' premium music experience through product innovation and revitalising our community. Through ongoing main product upgrades in the first half of 2025, we have enhanced our product's visual appeal, streamlined its functionality and made it more user-friendly. Our efforts have yielded improved user engagement metrics, including higher activity ratio and increased time spent listening to music within our app.

Optimising users' music discovery and listening experience

We deepened our efforts to improve users' music discovery and consumption experience via enhancements to personalised content recommendations and innovative features for a premium music listening experience.

• Music content discovery and distribution. We elevated our efforts to improve the recommendation experience and efficiency, boosting user stickiness through the following initiatives: 1) streamlining homepage modules, removing inefficient playlists, and optimising display timing to enhance distribution efficiency; 2) refining the user experience for liking and collecting, improving user genre preference data accuracy, and responding to user feedback in real time; 3) enriching interest and preference data for new users and adding new trending content recommendations; and, 4) upgrading the access experience for vertical genre zones in the discovery channel.
• Enhancing the music consumption experience. We enhanced the music experience and expanded more audio-visual needs. We further streamlined the product homepage by merging the "Recommendation" and "Discovery" channels and simplifying the bottom tab navigation for a better user experience. Innovations like the "Magic Light Player" (神光播放器), which immersively displays lyrics and uses special visual effects to highlight choruses and simulate the ambience of a live performance, received widespread acclaim. "Magic Light" mode now supports landscape orientation, boosting user screen-on time. We launched "Music Cards" (音乐小卡片), allowing users to showcase their unique tastes. Leveraging the DeepSeek model, we also introduced the "Interpret Your Music Taste" activity, further boosting music consumption.

Expanding music consumption scenarios

We continuously expand our multi-terminal layout, with our IoT coverage consistently being improved with enhancements to multi-terminal experiences. In the first half of 2025, we extended in-car coverage to new brands and models through partnerships with Jetour and LYNK & CO, among others. Additionally, we are improving the IoT device experience to boost user engagement. For in-vehicle scenarios, we added features like "Heartbeat Mode" (心动模式), Audio Vivid and podcasts, while enhancing seamless playback. For TV devices, we are expanding the reach of innovative features like "Ambient Roaming" (氛围漫游), and emphasising audio-visual entertainment on TV terminals through features such as "Sing at Will" (随心唱), "Lyric Animation" (歌词动效), and "Magic Light Player" (神光播放器).

Conference Call

The Company's management will host an earnings conference call at 7:00 p.m. Beijing/Hong Kong Time on Thursday, August 14, 2025 (7:00 a.m. U.S. Eastern Time on the same day). Details for the conference call are as follows:

Event Title: NetEase Cloud Music Inc. First Half 2025 Earnings Conference Call

Registration Link: https://s1.c-conf.com/diamondpass/10049196-sgtd5f.html

All participants must use the link provided above to complete the online registration process in advance of the conference call. Upon registering, each participant will receive a set of dial-in numbers, an event passcode, and a personal access PIN, which will be used to join the conference call.

A replay of the call will be accessible by phone at the following numbers and entering PIN: 10049196. The replay will be available through August 21, 2025.

Additionally, a live and archived webcast of the conference call will be available on the Company's investor relations website at http://ir.music.163.com.

About NetEase Cloud Music Inc.

Launched in 2013 by NetEase, Inc. (NASDAQ:NTES, HKEX: 9999)), NetEase Cloud Music Inc. (HKEX: 9899) is a well-known online music platform featuring a vibrant content community. Dedicated to providing an elevated user experience, NetEase Cloud Music Inc. provides precise, personalised recommendations, promotes user interaction and creates a strong social community. Its focus on discovering and promoting emerging musicians has made NetEase Cloud Music Inc. a destination of choice for exploring new and independent music among music enthusiasts in China. The platform has been recognised as the most popular entertainment app among China's vibrant Generation Z community.

Please see http://ir.music.163.com/ for more information.

Forward Looking Statements

This press release contains forward-looking statements relating to the business outlook, estimates of financial performance, forecast business plans and growth strategies of the Company. These forward-looking statements are based on information currently available to the Company and are stated herein on the basis of the outlook at the time of this press release. They are based on certain expectations, assumptions and premises, some of which are subjective or beyond our control. These forward-looking statements may prove to be incorrect and may not be realised in the future. Underlying these forward-looking statements are a lot of risks and uncertainties. In light of the risks and uncertainties, the inclusion of forward-looking statements in this press release should not be regarded as representations by the Board or the Company that the plans and objectives will be achieved, and investors should not place undue reliance on such statements.

Non-IFRS Measure

To supplement our consolidated results, which are prepared and presented in accordance with International Financial Reporting Standards ("IFRS"), our Company uses adjusted operating profit and adjusted net profit as additional financial measures, which are not required by, or presented in accordance with IFRS. We believe that these measures facilitate comparisons of operating performance from period to period and company to company by eliminating the potential impact of items that our management does not consider to be indicative of our Group's operating performance, such as certain non-cash items. The use of these non-IFRS measures has limitations as an analytical tool, and shareholders and potential investors of our Company should not consider them in isolation from, as a substitute for, as an analysis of, or superior to, our Group's results of operations or financial condition as reported under IFRS. In addition, these non-IFRS financial measures may be defined differently from similar terms used by other companies, and may not be comparable to other similarly titled measures used by other companies. Our presentation of these non-IFRS measures should not be construed as an implication that our future results will be unaffected by unusual or non-recurring items.

Investor Enquiries:

Angela Xu

NetEase Cloud Music Inc.

[email protected]

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SOURCE NetEase Cloud Music