Youdao, the search engine released by the Chinese internet company saw losses nearly triple in 2020.
Netease released its financial report for the fourth quarter and the whole year of 2020 on February 25. According to the data, Netease's revenue in the current quarter was CNY 19.76 billion, a year-on-year increase of 25.6%; its net profit was CNY 1.6 billion, down 56.4% year-on-year. As for the whole year of 2020, the company's net income was CNY 73.67 billion, up 24.4% year-on-year whereas its net profit was CNY 14.71 billion, a year-on-year decrease of 6.1%.
Netease explained that the decline was not caused by the operating conditions rather by the exchange of USD against CNY and as well as other investments.
In the fourth quarter of 2020, the net revenue of Netease online game service business was CNY13.4 billion, an increase of 15.5% over the same period last year, accounting for 67.8% of the total revenue in the current quarter. During the same period, Youdao's net income was CNY 1.11 billion, an increase of 169.7%; the net income of innovation and other businesses was CNY 5.25 billion, up 41.3% year-on-year.
In 2020, Netease's online game service revenue was CNY 54.61 billion, an increase of 17.6% over the previous year, accounting for 74.1% of the total revenue. During the same period, Youdao's revenue was CNY 3.17 billion, an increase of 142.7% year-0n-year; innovation and other business revenue increased by 38% year-on-year to CNY 15.89 billion.
According to NetEase, its revenue is mainly driven by online games, Youdao, 'innovation and other businesses.'
At the same time, Netease Youdao also released the financial report for 2020 according to which the substantial increase in revenue was mainly due to the substantial increase in the number of paying users and the increase in the unit price of the K12 segment. However, while the revenue increased, the net loss attributable to common shareholders of the company reached CNY 1.75 billion, up 192.6% compared with that in 2019.