NetDragon (00777) announced its 2025 interim results, reporting revenue of RMB 2.381 billion and gross profit of RMB 1.655 billion. Net profit attributable to shareholders reached approximately RMB 30 million, with earnings per share of 5.57 cents. The company declared an interim dividend of HK$0.5 per share.

Gaming and application services revenue totaled RMB 1.7 billion in the first half. The company emphasizes long-term game operations and building evergreen gaming IP. While gaming revenue experienced short-term decline due to cyclical factors, the company continues to enhance player experience and promote user growth and engagement, establishing a solid foundation for sustainable long-term development of its gaming business.

With ongoing cost reduction and efficiency improvement initiatives, operating expenses for gaming and application services were effectively controlled, declining 14.7% year-over-year. Operating segment profit recovered to RMB 501 million sequentially, demonstrating strong resilience and positive recovery momentum.

In the gaming sector, the company has comprehensively deployed AI production centers to drive continuous organizational efficiency improvements. The overall workforce structure is better aligned with the AI era, strengthening team capabilities and cohesion, leading to a 26.7% year-over-year decrease in R&D expenses for the gaming and application services segment.

While contributing to cost reduction, the AI+ strategy has also significantly boosted efficiency. Different game teams under the same IP have achieved efficient integration through AI production centers, substantially improving cross-version game content collaboration and automated generation capabilities.

The company's R&D innovation work is accelerating in line with AI trends. The major new title "Code MY" began small-scale testing for IP users in August 2025 and continues advancing toward official launch. Mobile game "Code Alpha" will gradually expand to multiple overseas markets. With AI production center support, flagship IP Eudemons will efficiently launch multi-language versions to explore new overseas market opportunities. "Eudemons Legend" successfully entered the mini-game market in the first half of 2025, further enhancing IP influence. Other traditional self-developed IPs including Twilight Spirits and Mech War are also planned for release through agency and licensing partnerships, generating incremental revenue.

Looking ahead, the company positions AI-native games as a long-term R&D objective. Initial capabilities have been established in AIGC art, multi-agent collaboration, intelligent NPCs, data-driven iteration, and security compliance. The company plans to gradually promote R&D achievements and develop prototypes, laying foundations for future gaming innovation.

In application services, the company has further deepened its strategy of fully embracing the AI era. Domestic education technology business will focus on national-level platforms and key AI technology service projects, as well as vocational education. The AI vocational education cooperation project with Thailand's Ministry of Higher Education, Science, Research and Innovation (MHESI) has successfully launched, providing vocational skills training in electric vehicles and other fields to university students and youth nationwide.

With World Bank support, the company signed cooperation agreements with Cameroon's Ministry of Secondary Education (MINESEC) to jointly advance Cameroon's digital education development and improve educational equity and teaching quality.

The company's Hong Kong subsidiary Cherrypicks successfully secured strategic investment from CAS Anken, transforming into CAS Anken's exclusive overseas expansion platform and commercialization partner in international markets, promoting the implementation of China's leading AI technology in Hong Kong, Macau, and overseas markets. CAS Anken's "Yayi" large language model and AI-Scientist research intelligent agent achieved dual first place rankings in the 2025 Global AI Agent Evaluation, demonstrating outstanding technological R&D advantages.

AI application products including social listening and multimodal creation tools jointly developed by Cherrypicks and CAS Anken completed global launch in August 2025. Leveraging Hong Kong's advantages as an "international innovation and technology hub" and multilingual environment, these products will penetrate Southeast Asian, European, and American overseas markets.

The strategic cooperation with CAS Anken will not only bring new revenue growth points but also further strengthen NetDragon's overall AI technical capabilities and resource reserves.

Beyond gaming and application services, the company's strategic positioning in frontier technology and AI+ ecosystem continues to demonstrate value. An AI edge device company in the company's investment portfolio recently successfully launched next-generation AI glasses, marking a key breakthrough in consumer market applications.

In the cultural creativity and IP operations sector, the star IP portfolio of the company's invested companies continues expanding influence with significantly enhanced commercialization capabilities.

As of June 30, 2025, the company held approximately 12,000 Ethereum units with a fair value of RMB 211 million based on market value at that time.

Going forward, the company's strategic investments will continue focusing on frontier technology applications including AI, XR, robotics, and blockchain, as well as the cultural creative industry, strengthening synergies with the company's core business.