Giant Network Group Ltd. (NYSE ticker symbol: GA) announced the closing on December 31, 2009 unaudited fourth quarter and full year earnings.
According to the published four-quarter earnings, a giant four-quarter revenues of 276 million, ring than to reduce 4.9%, down 21.8%; operating profit of 176 million, ring than to reduce by 8.3%, down 17.7%; net profit of 1.98 billion yuan, ring than the basic flat, down 31.9%.
After the earnings announcement, shares the same day a giant network in New York Stock Exchange edged down 0.95 percent, to close at 7.31 U.S. dollars, the recent subject to the same section of the grand, the perfect negative earnings impact of China-related stocks generally poor performance of the network giant's share price also will be slightly lower, is expected to report earnings after the publication of the impact of negative emotions on the stock price will continue, but in view of the current performance of the market response is relatively stable.
Shi Yuzhu reasons for the decline in income has made an explanation: Since the start in July last year, closed the "open chest" and charging functions, resulting in a decline in revenues and profits, but as last year the implementation of market segmentation strategy, a number of important data showed signs of gradual recovery has already begun.
From the second quarter of 2009, a giant network of revenues and profits have been declining, in part because of course, is due to government supervision to increase online games, leading to some of the fees is turned off; the other hand, since 2009 China's online game market has become more due to fierce competition.
Giant network's main online games, "journey", with its unique yuan games are played in the 2006-2008 year has brought a giant network of huge income, but the imitation "journey" model of online game more and more, although the most of the competitors on the "journey" do not constitute a threat, but the hundreds of similar games, in the aggregate is still on the "journey" and not a small number of players resulted in the impact of a giant network of the past few quarters the number of concurrent players proof of this reduction; and as China's over-crowded online games, making the characteristics of a buyer's market is increasingly clear, major game operators are subject to considerable pressure, and many MMORPG at the same time-line in 2009 has reduced the number of signs of .
Moreover, with the relevant departments for the online game industry, has published a number of provisions so that the "journey" part of the fees received affected, directly led to the overall revenue and average revenue decline in paid subscribers, with the online game market-related laws and regulations has improved steadily and could have a similar "journey" mode of the game lasting impact.
However, the network giant's results also highlight the existence of the performance, although the revenues and profits have declined, but the Internet giant's net profit in the fourth quarter rate is still as high as 72%, significantly higher than the current published earnings of the other domestic online game operator providers, while the high profit margins, should be able to restore some market confidence; the same time, the decline in the fourth quarter of operating costs for the shareholders can also have some positive impact.