Shulou(Shulou.com)11/24 Report--

On August 24, NetEase Yun Music disclosed the H1 performance announcement in 2023. According to the financial report, NetEase Yun Music's net income in the first half of 2023 was 3.91 billion yuan, with an adjusted net profit of 332 million yuan. Both operating profit and adjusted net profit were positive for the first time. NetEase Yun Music continued to improve its music-centric liquidity and effective profit margins in the first half of 2023, thanks to a significant increase in subscription members. as well as the optimization of operational efficiency and cost structure, gross profit margin soared to 24.7% in the first half of 2023.

In the first half of the year, the number of monthly active users increased steadily to 206.7 million, and the number of users and paid income both increased. Despite the slowdown in the industry, the number of monthly active users of NetEase Yun music online music service grew steadily to 206.7 million in the first half of 2023, an increase of 13.7% over the same period last year. The ratio of daily active users to monthly active users remained stable at more than 30% in the first half of 2023, and the user stickiness of the platform continued to maintain a high level. The number of monthly paid households for online music services reached 41.75 million, an increase of 11% over the same period last year. Thanks to the expansion of the size of members and the growth of income per fee-paying households, the revenue of member subscriptions increased by 16.7% in the first half of the year, and the monthly income per paying user of online music services increased to 6.8 yuan.

Profitability continued to improve, with a gross profit margin of 24.7% and an adjusted net profit of 332 million yuan in the first half of the year. In the first half of 2023, the revenue from online music services reached 2.021 billion yuan, up 13.3 percent from the same period last year; the income from social entertainment services and other services was 1.89 billion yuan, and the number of households paying monthly fees for social entertainment services increased to 1.5 million. Profitability improved significantly in the first half of 2023, thanks to the expansion of the platform and the adjustment of cost optimization and revenue sharing, gross profit margin rose from 12.6% in the first half of 2022 to 24.7% in the first half of 2023. An adjusted net profit of 332 million yuan was recorded in the first half of 2023, compared with a loss of 217 million yuan in the same period last year.

Strengthen the music-oriented product experience and improve the music-centered realization ability. In the first half of 2023, NetEase Yun Music continued to strengthen music-oriented content products, improve the cashability of music-centered and improve profit margins. Among them, the scale of online music subscribers and monthly income per user of online music increased in the first half of the year. In order to improve the core music user experience and enhance profitability, the platform adjusts the operation strategy of social entertainment business, including reducing the exposure of some live broadcast functions on the site, reducing the income share between anchors and guilds, and strengthening internal risk control.

Copyright and originality have grown at the same time, and the ecology of multi-category music has further flourished. In 2023, NetEase Yun Music has established in-depth cooperation with a number of well-known brand companies and head artists, including trust music, fish Dingmi and other head Chinese brands, DREAMUS represented by mythology, and JTBC and other well-known Korean brands with a huge OST library. The rights to popular music variety shows such as "endless Treasure Island season", "Chinese rap Peak showdown 2023", "God-given Voice season 4", "A good Song of the play" and "the Band's Summer 3".

In the first half of 2023, NetEase Yun Music continued to make outstanding original music support, and the popular styles of homemade songs appeared frequently, with remarkable advantages in rejuvenation and localization. The platform self-made song "Jingwei" and "to the Cloud" went out of the circle many times to detonate the whole network, which was widely praised. As of the first half of 2023, NetEase Yun's content library contains 136 million music tracks, including music from well-known brands and original musicians. By June 2023, the number of original musicians on the platform exceeded 646000, and a total of about 2.8 million music tracks were created. Through the continuous development and support of superior music categories, NetEase Yun Music continues to enhance the attractiveness of users in pop, rap, folk songs, K-POP and other categories.

Launch a series of creative efficiency tools, broaden the whole process of content co-creation, and explore a new generation of man-machine music. NetEyun Music has launched a series of music creation efficiency assistance tools to actively explore the application of cutting-edge technology in the music field, covering the whole process of musicians' creation, such as inspiration charging station, BEATSOUL inspiration, NetEase Tianyin, NetEyun music X Studio and so on. Among them, in June launched AI singer music creation tool "NetEase Music X Studio", its virtual singer label WOWAIDO! The first batch of 12 members debut, all online X Studio, with NetEase musicians to explore a new generation of man-machine co-creation of music.

Explore multiple music consumption scenarios, improve the efficiency of content distribution, and deepen the value of copyright. Cooperate with NetEase's various games "Fantasy Journey to the West" and "Egg Party" to expand the scene of diversified music consumption. Its copyright distribution platform, Yuncun Exchange, distributed more than 1 million songs in the first half of 2023. Recently, the intelligent recommendation function of songs online on the platform is "private DJ". In the follow-up, NetEase Yun Music continues to improve the efficiency of song distribution on the platform, help spread high-quality works, and let music copyright appreciate.

The results in the first half of 2023 show that NetEase Yun Music continues to maintain healthy growth and profitability continues to improve. Recently, many brokerages such as China Bank International and Guoxin Securities have given Cloud Music a buy rating. China Bank International Research newspaper pointed out that the focus of Cloud Music has shifted from revenue growth to sustainable profit growth. Entering 2023, NetEase Yun music content ecology is further prosperous, and the profitability of the platform is steadily enhanced, which also promotes the continuous positive cycle of Yuncun ecology.

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