The9 Limited and Huanyu Joint Venture Sees Revenue and Profit Surge in 2025
The9 Limited, a notable player in the internet industry, has announced significant enhancements to its joint venture with Zhejiang Huanyu Network Technology Co., Ltd. This collaboration, which began in September 2024, is now set to yield greater financial performance than initially expected. The9 revealed that their subsidiary, Shanghai The9 Information Technology Co., Ltd., and Huanyu had entered into an amendment to their existing joint venture agreement, increasing the anticipated revenues and profits.
Originally outlining expected game revenues of RMB600 million and profits of RMB200 million for 2025, Huanyu has now committed to a robust revenue target of at least RMB900 million, which is roughly USD 124 million. Moreover, the expected profit has been raised to RMB300 million, approximately USD 41 million. This adjustment represents not only a strong increase but also a commitment to maintain a growth rate of at least 30% annually for both revenue and profit in the following years of 2026 and 2027.
Currently, The9 holds 51% of the joint venture shares, while Huanyu retains 49%. With this proportionate shareholding, profits will be accumulated and distributed quarterly among partners after taxes are accounted for. This joint venture aims to broaden its operations beyond the well-known game MIR M, which will leverage unique distribution rights through selected iOS and Android channels set forth in the agreement. The joint venture is already making strides with its pending application for an Internet Content Provider license, anticipated to be secured shortly.
Huanyu’s CEO, Liu Huan, expressed excitement about the potential of this venture stating, "Our collaboration with The9 has been seamless. The launch of the advanced game, MIR M, is highly anticipated following our strategies of combining formidable graphics via Unreal Engine 4 and deep market understanding. As we prepared for the launch, we felt confident in enhancing our financial targets, which reflects our optimism for sustained success within our partnership."
In aligning their financial strategies, The9 additionally provided Huanyu with a stock option of 475,102,500 restricted shares, equivalent to 1,583,675 American Depositary Shares (ADS). These shares will be released in increments based on Huanyu's adherence to the newly decided financial benchmarks for 2025.
The commitment from both sides underscores a forward-looking sentiment, enhancing collaboration and performance forecasts amidst a challenging competitive landscape. It emphasizes a mutual understanding of market demands and operational excellence in an ever-evolving gaming ecosystem which continues to attract millions of users across platforms.
Moreover, The9 is keen on maintaining various operational synergies with other gaming enterprises, ensuring that these partnerships do not detract from the joint ventures but rather, facilitate a broader reach and enhance user engagement across multiple game titles.
Looking ahead, the anticipated impact of MIR M is monumental, with strong expectations regarding its contribution to the revenue streams and overall market influence. The9, with its long-standing presence on Nasdaq since 2004 and its commitment to innovative development through collaborations like this, positions itself strategically within the fast-paced internet-driven economy. As gaming continues to be a lucrative market, ventures like this become crucial in steering growth and generating substantial financial returns while ensuring quality gaming experiences for users.
The9’s holistic approach in optimizing joint ventures and collaborations enhances its stature as a leading player in the gaming sector, signifying a robust roadmap for growth and sustainability in the forefront of digital entertainment.
Originally outlining expected game revenues of RMB600 million and profits of RMB200 million for 2025, Huanyu has now committed to a robust revenue target of at least RMB900 million, which is roughly USD 124 million. Moreover, the expected profit has been raised to RMB300 million, approximately USD 41 million. This adjustment represents not only a strong increase but also a commitment to maintain a growth rate of at least 30% annually for both revenue and profit in the following years of 2026 and 2027.
Currently, The9 holds 51% of the joint venture shares, while Huanyu retains 49%. With this proportionate shareholding, profits will be accumulated and distributed quarterly among partners after taxes are accounted for. This joint venture aims to broaden its operations beyond the well-known game MIR M, which will leverage unique distribution rights through selected iOS and Android channels set forth in the agreement. The joint venture is already making strides with its pending application for an Internet Content Provider license, anticipated to be secured shortly.
Huanyu’s CEO, Liu Huan, expressed excitement about the potential of this venture stating, "Our collaboration with The9 has been seamless. The launch of the advanced game, MIR M, is highly anticipated following our strategies of combining formidable graphics via Unreal Engine 4 and deep market understanding. As we prepared for the launch, we felt confident in enhancing our financial targets, which reflects our optimism for sustained success within our partnership."
In aligning their financial strategies, The9 additionally provided Huanyu with a stock option of 475,102,500 restricted shares, equivalent to 1,583,675 American Depositary Shares (ADS). These shares will be released in increments based on Huanyu's adherence to the newly decided financial benchmarks for 2025.
The commitment from both sides underscores a forward-looking sentiment, enhancing collaboration and performance forecasts amidst a challenging competitive landscape. It emphasizes a mutual understanding of market demands and operational excellence in an ever-evolving gaming ecosystem which continues to attract millions of users across platforms.
Moreover, The9 is keen on maintaining various operational synergies with other gaming enterprises, ensuring that these partnerships do not detract from the joint ventures but rather, facilitate a broader reach and enhance user engagement across multiple game titles.
Looking ahead, the anticipated impact of MIR M is monumental, with strong expectations regarding its contribution to the revenue streams and overall market influence. The9, with its long-standing presence on Nasdaq since 2004 and its commitment to innovative development through collaborations like this, positions itself strategically within the fast-paced internet-driven economy. As gaming continues to be a lucrative market, ventures like this become crucial in steering growth and generating substantial financial returns while ensuring quality gaming experiences for users.
The9’s holistic approach in optimizing joint ventures and collaborations enhances its stature as a leading player in the gaming sector, signifying a robust roadmap for growth and sustainability in the forefront of digital entertainment.
Topics Entertainment & Media）
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