NetEase (NTES) 20-F 25 Apr 24 2023 FY Annual report (foreign) Financial data

Document and Entity Information

Document and Entity Information	12 Months Ended
	Dec. 31, 2023 shares
Document and Entity Information
Document Type	20-F
Document Registration Statement	false
Document Annual Report	true
Document Period End Date	Dec. 31, 2023
Current Fiscal Year End Date	--12-31
Document Fiscal Year Focus	2023
Document Transition Report	false
Document Shell Company Report	false
Entity File Number	000-30666
Entity Registrant Name	NETEASE, INC.
Entity Incorporation, State or Country Code	E9
Entity Address, Address Line One	NetEase Building, No. 599 Wangshang Road
Entity Address, Address Line Two	Binjiang District
Entity Address, City or Town	Hangzhou
Entity Address, Postal Zip Code	310052
Entity Address, Country	CN
Entity Common Stock, Shares Outstanding	3,210,783,141
Entity Well-known Seasoned Issuer	Yes
Entity Voluntary Filers	No
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Large Accelerated Filer
Entity Emerging Growth Company	false
ICFR Auditor Attestation Flag	true
Document Financial Statement Error Correction [Flag]	false
Document Accounting Standard	U.S. GAAP
Entity Shell Company	false
Amendment Flag	false
Auditor Firm ID	1424
Auditor Name	PricewaterhouseCoopers Zhong Tian LLP
Auditor Location	Beijing, the People’s Republic of China
Entity Central Index Key	0001110646
Document Fiscal Period Focus	FY
American Depositary Shares
Document and Entity Information
Title of 12(b) Security	American Depositary Shares, each representing five ordinary shares, par value US$0.0001 per share
Trading Symbol	NTES
Security Exchange Name	NASDAQ
Ordinary shares
Document and Entity Information
Title of 12(b) Security	Ordinary shares, par value US$0.0001 per share
No Trading Symbol Flag	true
Security Exchange Name	NASDAQ
Business Contact
Document and Entity Information
Entity Address, Address Line One	Guoco Midtown #19-01
Entity Address, City or Town	128 Beach Road
Entity Address, Postal Zip Code	189773
Entity Address, Country	SG
Contact Personnel Name	Paul W. Boltz, Jr.
City Area Code	+65
Local Phone Number	6980 0628
Contact Personnel Email Address	ir@service.netease.com

Consolidated Balance Sheets

Consolidated Balance Sheets ¥ in Thousands, $ in Thousands	Dec. 31, 2023 CNY (¥)	Dec. 31, 2023 USD ($)	Dec. 31, 2022 CNY (¥)
Current assets:
Cash and cash equivalents	¥ 21,428,902	$ 3,018,198	¥ 24,889,000
Time deposits	100,856,034	14,205,275	84,947,679
Restricted cash	2,777,206	391,161	2,699,055
Accounts receivable, net	6,422,417	904,579	5,002,872
Inventories	695,374	97,941	993,636
Prepayments and other current assets, net	6,076,595	855,871	5,448,284
Short-term investments	4,436,057	624,806	7,622,673
Total current assets	142,692,585	20,097,831	131,603,199
Non-current assets:
Property, equipment and software, net	8,075,044	1,137,346	6,342,330
Land use rights, net	4,075,143	573,972	4,121,767
Operating lease right-of-use assets, net	749,275	105,533	887,977
Deferred tax assets	1,560,088	219,734	1,480,789
Time deposits	1,050,000	147,889	2,973,840
Restricted cash	550	77	270
Long-term investments	21,783,187	3,068,098	18,544,358
Other long-term assets	5,939,106	836,505	6,806,455
Total non-current assets	43,232,393	6,089,154	41,157,786
Total assets	185,924,978	26,186,985	172,760,985
Current liabilities:
Accounts payable	881,016	124,089	1,507,141
Salary and welfare payables	4,857,206	684,123	4,732,941
Taxes payable	2,571,534	362,193	2,813,096
Short-term loans	19,240,163	2,709,920	23,875,704
Contract liabilities	13,362,166	1,882,022	12,518,890
Accrued liabilities and other payables	12,670,906	1,784,660	11,122,022
Short-term operating lease liabilities	259,493	36,549	259,053
Total current liabilities	53,842,484	7,583,556	56,828,847
Non-current liabilities:
Deferred tax liabilities	2,299,303	323,850	2,126,120
Long-term operating lease liabilities	555,829	78,287	672,640
Long-term loans	427,997	60,282	3,654,964
Other long-term liabilities	715,284	100,745	604,934
Total non-current liabilities	3,998,413	563,164	7,058,658
Total liabilities	57,840,897	8,146,720	63,887,505
Commitments and contingencies
Redeemable noncontrolling interests	115,759	16,304	136,440
Shareholders' equity:
Ordinary shares, US$0.0001 par value: 1,000,300,000,000 shares authorized, 3,223,623,596 and 3,210,783,141 shares issued and outstanding as of December 31, 2022 and 2023, respectively	2,710	382	2,710
Additional paid-in capital	22,604,651	3,183,799	22,854,234
Treasury stock	(12,694,364)	(1,787,964)	(10,910,754)
Statutory reserves	1,541,416	217,103	1,278,666
Accumulated other comprehensive income	616,780	86,872	431,786
Retained earnings	112,214,583	15,805,093	91,074,675
NetEase, Inc.'s shareholders' equity	124,285,776	17,505,285	104,731,317
Noncontrolling interests	3,682,546	518,676	4,005,723
Total equity	127,968,322	18,023,961	108,737,040
Total liabilities, redeemable noncontrolling interests and shareholders' equity	¥ 185,924,978	$ 26,186,985	¥ 172,760,985

Consolidated Balance Sheets (Pa

Consolidated Balance Sheets (Parenthetical) - $ / shares	Dec. 31, 2023	Dec. 31, 2022
Consolidated Balance Sheets
Ordinary shares, par value (in dollars per share)	$ 0.0001	$ 0.0001
Ordinary shares, shares authorized	1,000,300,000,000	1,000,300,000,000
Ordinary shares, shares issued	3,210,783,141	3,223,623,596
Ordinary shares, shares outstanding	3,210,783,141	3,223,623,596

Consolidated Statements of Oper

Consolidated Statements of Operations and Comprehensive Income ¥ in Thousands, shares in Thousands, $ in Thousands	12 Months Ended
	Dec. 31, 2023 CNY (¥) ¥ / shares shares	Dec. 31, 2023 USD ($) $ / shares shares	Dec. 31, 2022 CNY (¥) ¥ / shares shares	Dec. 31, 2021 CNY (¥) ¥ / shares shares
Consolidated Statements of Operations and Comprehensive Income
Net revenues	¥ 103,468,159	$ 14,573,185	¥ 96,495,809	¥ 87,606,026
Cost of revenues	(40,404,765)	(5,690,892)	(43,729,683)	(40,635,225)
Gross profit	63,063,394	8,882,293	52,766,126	46,970,801
Operating expenses:
Selling and marketing expenses	(13,969,460)	(1,967,557)	(13,402,721)	(12,214,191)
General and administrative expenses	(4,899,880)	(690,134)	(4,695,798)	(4,263,549)
Research and development expenses	(16,484,910)	(2,321,851)	(15,039,014)	(14,075,991)
Total operating expenses	(35,354,250)	(4,979,542)	(33,137,533)	(30,553,731)
Operating profit	27,709,144	3,902,751	19,628,593	16,417,070
Other income/(expenses):
Investment income, net	1,306,722	184,048	53,976	2,947,721
Interest income, net	4,120,418	580,349	2,149,673	1,519,714
Exchange (losses)/gains, net	(132,999)	(18,733)	1,571,207	(490,481)
Other, net	1,053,642	148,402	846,815	710,435
Income before tax	34,056,927	4,796,817	24,250,264	21,104,459
Income tax	(4,699,704)	(661,939)	(5,031,838)	(4,128,269)
Net income from continuing operations	29,357,223	4,134,878	19,218,426	16,976,190
Net income from discontinued operations | ¥			624,864
Net income	29,357,223	4,134,878	19,843,290	16,976,190
Accretion of redeemable noncontrolling interests	(3,589)	(506)	(2,978)	(536,981)
Net loss attributable to noncontrolling interests and redeemable noncontrolling interests	62,918	8,862	497,288	417,633
Net income attributable to the Company's shareholders	29,416,552	4,143,234	20,337,600	16,856,842
Including:
Net income from continuing operations attributable to the Company's shareholders	29,416,552	4,143,234	19,712,736	16,856,842
Net income from discontinued operations attributable to the Company's shareholders | ¥			624,864
Net income	29,357,223	4,134,878	19,843,290	16,976,190
Other comprehensive income
Foreign currency translation adjustment	221,872	31,250	1,441,414	(183,190)
Total comprehensive income	29,579,095	4,166,128	21,284,704	16,793,000
Comprehensive loss attributable to noncontrolling interests and redeemable noncontrolling interests	26,040	3,668	315,725	423,215
Comprehensive income attributable to the Company's shareholders	¥ 29,605,135	$ 4,169,796	¥ 21,600,429	¥ 17,216,215
Net income per share, basic (in CNY and dollars per share) | (per share)	¥ 9.15	$ 1.29	¥ 6.23	¥ 5.07
-Continuing operations (in CNY and dollars per share) | (per share)	9.15	1.29	6.04	5.07
-Discontinued operations (in CNY and dollars per share) | ¥ / shares			0.19
Net income per ADS, basic (in CNY and dollars per share) | (per share)	45.73	6.44	31.16	25.34
-Continuing operations (in CNY and dollars per share) | (per share)	45.73	6.44	30.20	25.34
-Discontinued operations (in CNY and dollars per share) | ¥ / shares			0.96
Net income per share, diluted (in CNY and dollars per share) | (per share)	9.05	1.27	6.17	5.01
-Continuing operations (in CNY and dollars per share) | (per share)	9.05	1.27	5.98	5.01
-Discontinued operations (in CNY and dollars per share) | ¥ / shares			0.19
Net income per ADS, diluted (in CNY and dollars per share) | (per share)	45.23	6.37	30.85	25.03
-Continuing operations (in CNY and dollars per share) | (per share)	¥ 45.23	$ 6.37	29.90	¥ 25.03
-Discontinued operations (in CNY and dollars per share) | ¥ / shares			¥ 0.95
Weighted average number of ordinary shares outstanding, basic (in shares) | shares	3,216,475	3,216,475	3,263,455	3,325,864
Weighted average number of ADS outstanding, basic (in shares) | shares	643,295	643,295	652,691	665,173
Weighted average number of ordinary shares outstanding, diluted (in shares) | shares	3,252,029	3,252,029	3,296,014	3,367,478
Weighted average number of ADS outstanding, diluted (in shares) | shares	650,406	650,406	659,203	673,496

Consolidated Statements of Shar

Consolidated Statements of Shareholders' Equity ¥ in Thousands, $ in Thousands	Ordinary shares CNY (¥) shares	Additional paid-in capital CNY (¥)	Treasury stock CNY (¥) shares	Statutory reserves CNY (¥)	Accumulated other comprehensive (loss)/income CNY (¥)	Retained earnings CNY (¥)	Noncontrolling interests CNY (¥)	CNY (¥) shares	USD ($) shares
Balance at Dec. 31, 2020	¥ 2,794	¥ 27,829,431	¥ (10,446,107)	¥ 1,228,448	¥ (650,457)	¥ 64,162,689	¥ 871,006	¥ 82,997,804
Balance (in shares) at Dec. 31, 2020 | shares	3,446,311,000
Balance (in shares) at Dec. 31, 2020 | shares			(96,976,000)
Vesting of restricted share units		(2,714,220)	¥ 2,714,220
Vesting of restricted share units (in shares) | shares			25,335,000
Share-based compensation		2,354,851					601,183	2,956,034
Appropriation to statutory reserves				16,677		(16,677)
Net income/(loss) attributable to the Company, noncontrolling and redeemable noncontrolling interest shareholders						17,393,823	(389,857)	17,003,966
Repurchase of shares			¥ (12,770,301)					(12,770,301)
Repurchase of shares (in shares) | shares			(100,835,000)
Net change of capital from noncontrolling interest shareholders		1,640,728					1,143,753	2,784,481
Conversion of Cloud Music's preferred shares recognized as redeemable noncontrolling interests to ordinary shares		8,805,149					2,473,352	11,278,501
Dividends to shareholders						(3,508,379)		(3,508,379)
Dividends to noncontrolling interest shareholders							(731,250)	(731,250)
Foreign currency translation adjustment					(177,608)		(5,582)	(183,190)
Accretion of redeemable noncontrolling interests						(536,981)	(12,047)	(549,028)
Balance at Dec. 31, 2021	¥ 2,794	37,915,939	¥ (20,502,188)	1,245,125	(828,065)	77,494,475	3,950,558	99,278,638
Balance (in shares) at Dec. 31, 2021 | shares	3,446,311,000
Balance (in shares) at Dec. 31, 2021 | shares			(172,476,000)
Vesting of restricted share units	¥ 0	(2,569,917)	¥ 2,569,917
Vesting of restricted share units (in shares) | shares	518,000		22,632,000
Share-based compensation		2,763,611					277,999	3,041,610
Appropriation to statutory reserves				33,541		(33,541)
Net income/(loss) attributable to the Company, noncontrolling and redeemable noncontrolling interest shareholders						20,340,578	(483,268)	19,857,310
Repurchase of shares			¥ (8,006,226)					(8,006,226)
Repurchase of shares (in shares) | shares			(73,361,000)
Cancellation of repurchased shares	¥ (84)	(15,027,659)	¥ 15,027,743
Cancellation of repurchased shares (in shares) | shares	(125,553,000)		125,553,000
Net change of capital from noncontrolling interest shareholders		(227,740)					81,115	(146,625)
Dividends to shareholders						(6,723,859)		(6,723,859)
Foreign currency translation adjustment					1,259,851		181,563	1,441,414
Accretion of redeemable noncontrolling interests						(2,978)	(2,244)	(5,222)
Balance at Dec. 31, 2022	¥ 2,710	22,854,234	¥ (10,910,754)	1,278,666	431,786	91,074,675	4,005,723	¥ 108,737,040
Balance (in shares) at Dec. 31, 2022 | shares	3,321,276,000							3,223,623,596	3,223,623,596
Balance (in shares) at Dec. 31, 2022 | shares			(97,652,000)
Vesting of restricted share units		(3,007,404)	¥ 3,007,404
Vesting of restricted share units (in shares) | shares			25,951,000
Share-based compensation		2,913,644					149,757	¥ 3,063,401
Appropriation to statutory reserves				262,750		(262,750)
Net income/(loss) attributable to the Company, noncontrolling and redeemable noncontrolling interest shareholders						29,420,141	(66,677)	29,353,464
Repurchase of shares			¥ (4,791,014)					(4,791,014)
Repurchase of shares (in shares) | shares			(38,792,000)
Net change of capital from noncontrolling interest shareholders		(155,823)					(471,164)	(626,987)
Reclassification from mezzanine equity to noncontrolling interest shareholders							30,369	30,369
Dividends to shareholders						(8,013,894)		(8,013,894)
Foreign currency translation adjustment					184,994		36,878	221,872
Accretion of redeemable noncontrolling interests						(3,589)	(2,340)	(5,929)
Balance at Dec. 31, 2023	¥ 2,710	¥ 22,604,651	¥ (12,694,364)	¥ 1,541,416	¥ 616,780	¥ 112,214,583	¥ 3,682,546	¥ 127,968,322	$ 18,023,961
Balance (in shares) at Dec. 31, 2023 | shares	3,321,276,000							3,210,783,141	3,210,783,141
Balance (in shares) at Dec. 31, 2023 | shares			(110,493,000)

Consolidated Statements of Cash

Consolidated Statements of Cash Flows ¥ in Thousands, $ in Thousands	12 Months Ended
	Dec. 31, 2023 CNY (¥)	Dec. 31, 2023 USD ($)	Dec. 31, 2022 CNY (¥)	Dec. 31, 2021 CNY (¥)
Cash flows from operating activities:
Net income	¥ 29,357,223	$ 4,134,878	¥ 19,843,290	¥ 16,976,190
Net income from discontinued operations			(624,864)
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	3,055,260	430,324	2,858,209	3,275,727
Fair value change of equity security investments	(535,316)	(75,398)	3,104,336	(471,880)
Impairment losses on investments and other long-term assets	469,159	66,080	300,249	100,424
Share-based compensation cost	3,242,810	456,740	3,174,160	3,041,492
Allowance for expected credit losses	61,146	8,612	61,393	265,930
Losses on disposal of property, equipment and software	5,676	799	3,620	54,052
Unrealized exchange losses/ (gains)	119,935	16,893	(1,604,260)	488,604
Gains on disposal of long-term investments, business and subsidiaries	(63,784)	(8,984)	(1,791,355)	(186,920)
Deferred income taxes	131,437	18,513	489,670	407,948
Share of results on equity method investees and revaluation results from previously held equity interest	(473,947)	(66,754)	(1,259,941)	(1,573,068)
Fair value changes of short-term investments	(414,207)	(58,340)	(342,642)	(639,757)
Changes in operating assets and liabilities:
Accounts receivable	(1,470,374)	(207,098)	554,340	(1,186,586)
Inventories	296,764	41,798	(27,613)	(343,587)
Prepayments and other assets	87,556	12,332	731,100	640,349
Accounts payable	(559,419)	(78,792)	447,666	(155,262)
Salary and welfare payables	(62,917)	(8,862)	424,513	505,334
Taxes payable	(244,261)	(34,403)	(917,614)	255,060
Contract liabilities	1,161,861	163,645	385,396	1,351,261
Accrued liabilities and other payables	1,166,673	164,323	1,899,580	2,121,416
Net cash provided by operating activities	35,331,275	4,976,306	27,709,233	24,926,727
Cash flows from investing activities:
Purchase of property, equipment and software	(2,301,554)	(324,167)	(2,100,264)	(1,601,830)
Proceeds from sale of property, equipment and software	10,302	1,451	41,467	71,524
Purchase of intangible assets, content and licensed copyrights	(1,974,323)	(278,078)	(543,220)	(1,508,179)
Net change of short-term investments with terms of three months or less	(1,777,687)	(250,382)	776,357	3,694,890
Purchase of short-term investments with terms over three months			(5,950,000)	(15,285,000)
Proceeds from maturities of short-term investments with terms over three months	5,378,510	757,547	10,175,160	13,235,845
Investment in equity method investees	(444,557)	(62,615)	(705,907)	(1,124,429)
Investment in other equity investments and acquisition of subsidiaries	(2,387,129)	(336,219)	(4,423,773)	(5,417,138)
Proceeds from disposal of long-term investments, businesses and subsidiaries	152,564	21,488	2,411,070	1,115,457
Placement/rollover of matured time deposits	(124,693,598)	(17,562,726)	(98,973,884)	(81,298,080)
Proceeds from maturities of time deposits	111,417,969	15,692,893	92,247,046	81,307,297
Change in other long-term assets	(423,928)	(59,709)	(323,779)	(268,651)
Net cash used in investing activities	(17,043,431)	(2,400,517)	(7,369,727)	(7,078,294)
Cash flows from financing activities:
Net changes from short-term loans with terms of three months or less	(13,654,704)	(1,923,225)	(1,274,043)	(442,207)
Proceed of loans with terms over three months	13,569,160	1,911,176	6,392,695	4,447,586
Payment of loans with terms over three months	(8,219,472)	(1,157,688)	(273,639)	(2,297,135)
Dividends paid to shareholders	(8,013,903)	(1,128,735)	(6,723,667)	(3,508,377)
Net amounts paid for NetEase's issuance of shares in Hong Kong				(13,800)
Net amounts received/ (paid) related to capital contribution from or repurchase of noncontrolling interests and redeemable noncontrolling interests shareholders	86,159	12,136	(30,921)	2,870,147
Dividends paid to noncontrolling interest shareholders				(731,250)
Cash paid for repurchase of NetEase's ADSs/purchase of subsidiaries' ADSs and shares	(5,234,294)	(737,235)	(8,328,124)	(12,910,533)
Net cash used in financing activities	(21,467,054)	(3,023,571)	(10,237,699)	(12,585,569)
Effect of exchange rate changes on cash, cash equivalents and restricted cash held in foreign currencies	(202,457)	(28,516)	110,403	(55,354)
Net increase/ (decrease) in cash, cash equivalents and restricted cash	(3,381,667)	(476,298)	10,212,210	5,207,510
Cash, cash equivalents and restricted cash, at the beginning of the year	27,588,325	3,885,734	17,376,115	12,168,605
Cash, cash equivalents and restricted cash, at end of the year	24,206,658	3,409,436	27,588,325	17,376,115
Supplemental disclosures of cash flow information:
Cash paid for income taxes, net	4,895,752	689,552	5,092,391	3,547,299
Cash paid for interest expenses	779,872	109,843	588,381	187,628
Supplemental schedule of non-cash investing and financing activities:
Fixed asset purchases financed by accounts payable and accrued liabilities	¥ 1,026,852	$ 144,629	¥ 689,093	¥ 698,192

Organization and Nature of Oper

Organization and Nature of Operations	12 Months Ended
	Dec. 31, 2023
Organization and Nature of Operations
Organization and Nature of Operations	1. Organization and Nature of Operations (a) The Group NetEase.com, Inc. was incorporated in the Cayman Islands on July 6, 1999 and changed its name to “NetEase, Inc.” (“the Company”) with effect from March 29, 2012. The Company completed its initial public offering (“IPO”) in July 2000 in connection with its listing on the Nasdaq National Market (now the Nasdaq Global Select Market) in the United States of America. In June 2020, the Company successfully listed its ordinary shares on the main board of the Hong Kong Stock Exchange. As of December 31, 2023, the Company has wholly-owned and majority-owned subsidiaries incorporated in countries and jurisdictions mainly in the People’s Republic of China (“PRC” or “China”, references to “China” and “PRC” are to the People’s Republic of China, excluding, for the purposes of the financial statements only, Hong Kong, Macau and Taiwan), Hong Kong, Cayman Islands and British Virgin Islands (“BVI”) and other countries. The Company is also the primary beneficiary of a number of variable interest entities (“VIEs”) and consolidates the VIEs for financial reporting. The Company, its subsidiaries and the VIEs are hereinafter collectively referred to as the “Group”. On October 26, 2019, Youdao, Inc. (“Youdao”), one of the Company’s majority-controlled subsidiaries completed its IPO on the New York Stock Exchange. In February 2021, Youdao completed a follow-on public offering in the New York Stock Exchange. After Youdao’s offerings, the Company continues to control Youdao and consolidates Youdao as its controlling shareholder. On December 2, 2021, Cloud Village, Inc. (“Cloud Music”), one of the Company’s majority-controlled subsidiaries completed its IPO on the Hong Kong Stock Exchange. After Cloud Music’s offering, the Company continues to control Cloud Music and consolidates Cloud Music as its controlling shareholder. The major subsidiaries and the VIEs through which the Company conducts its business operations as of December 31, 2023 are described below: ​ ​ ​ ​ ​ Place and year of Major Subsidiaries ​ Incorporation Guangzhou Boguan Telecommunication Technology Co., Ltd. (“Boguan”) Guangzhou, China 2003 NetEase (Hangzhou) Network Co., Ltd. (“NetEase Hangzhou”) Hangzhou, China 2006 Hong Kong NetEase Interactive Entertainment Limited ​ Hong Kong, China 2007 ​ ​ ​ ​ ​ Place and year of Major VIEs and VIEs’ subsidiaries ​ Incorporation Guangzhou NetEase Computer System Co., Ltd. (“Guangzhou NetEase”) Guangzhou, China 1997 Hangzhou NetEase Leihuo Technology Co., Ltd. (“Hangzhou Leihuo”, formerly known as Hangzhou NetEase Leihuo Network Co., Ltd.) Hangzhou, China 2009 ​ Guangzhou NetEase was incorporated in June 1997 in China and owned by William Lei Ding, or Mr. Ding, the Company’s Chief Executive Officer, director and major shareholder, and another Chinese employee of the Group. It is responsible for providing online game and other value-added telecommunication services. Hangzhou Leihuo was incorporated in April 2009 in China by two Chinese employees of the Group and currently operates the Company’s mobile game business. The following combined financial information of the VIEs was included in the accompanying consolidated financial statements of the Group as follows (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ December 31, ​ December 31, ​ 2022 2023 ​ ​ RMB ​ RMB Cash and cash equivalents ​ 2,303,280 ​ 1,802,256 Time deposits ​ 400,000 ​ 420,000 Restricted cash ​ 2,654,971 ​ 2,701,083 Accounts receivable, net ​ 3,542,272 ​ 4,663,331 Inventories ​ 67,572 ​ 36,908 Prepayments and other current assets, net ​ 1,867,110 ​ 1,765,209 Short-term investments ​ 73,984 ​ 73,904 Amounts due from Group companies ​ 9,917,091 ​ 9,192,463 Total current assets ​ 20,826,280 ​ 20,655,154 ​ ​ ​ ​ ​ Property, equipment and software, net ​ 78,666 ​ 52,212 Operating lease right-of-use assets, net ​ 54,653 ​ 53,686 Deferred tax assets ​ 155,595 ​ 148,847 Restricted cash ​ 200 ​ 500 Long-term investments ​ 885,372 ​ 1,212,804 Other long-term assets ​ 164,968 ​ 203,744 Total non-current assets ​ 1,339,454 ​ 1,671,793 ​ ​ ​ ​ ​ Total assets 22,165,734 22,326,947 ​ ​ ​ ​ ​ Accounts payable ​ 802,717 ​ 265,137 Salary and welfare payables ​ 155,478 ​ 114,794 Taxes payable ​ 41,352 ​ 142,769 Short-term loans ​ 422 ​ 16,095 Contract liabilities ​ 11,465,101 ​ 12,401,426 Accrued liabilities and other payables ​ 3,809,049 ​ 3,689,885 Short-term operating lease liabilities ​ 20,690 ​ 22,413 Amounts due to Group companies ​ 3,937,784 ​ 2,822,751 Total current liabilities ​ 20,232,593 ​ 19,475,270 ​ ​ ​ ​ ​ Long-term operating lease liabilities ​ 34,291 ​ 30,278 Other long-term payable ​ 263,373 ​ 554,648 Total non-current liabilities ​ 297,664 ​ 584,926 ​ ​ ​ ​ ​ Total liabilities 20,530,257 20,060,196 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the year ended December 31, ​ 2021 2022 2023 ​ ​ RMB ​ RMB ​ RMB Net revenues ​ ​ ​ Third-party revenues ​ 74,406,521 ​ 82,549,444 ​ 90,054,544 Intra-Group revenues ​ 808,648 ​ 817,962 ​ 734,857 Total net revenues ​ 75,215,169 ​ 83,367,406 ​ 90,789,401 ​ ​ ​ ​ ​ ​ ​ Cost of revenues and operating expenses ​ ​ ​ ​ ​ ​ Third-party cost of revenues and operating expenses ​ (17,651,675) ​ (18,358,287) ​ (17,468,565) Intra-Group cost of revenues and operating expenses related to technical consulting and related service ​ (56,822,482) ​ (64,777,586) ​ (72,992,568) Other intra-Group cost of revenues and operating expenses ​ (168,850) ​ (185,608) ​ (23,546) Total cost of revenues and operating expenses ​ (74,643,007) ​ (83,321,481) ​ (90,484,679) ​ ​ ​ ​ ​ ​ ​ Net income 624,299 (81,329) 328,357 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the year ended December 31, ​ 2021 2022 2023 ​ ​ RMB ​ RMB ​ RMB Cash flows from operating activities: ​ ​ ​ ​ ​ ​ Net cash provided by transactions with third-parties ​ 61,272,031 ​ 67,459,864 ​ 72,325,460 Net cash used in transactions with intra-Group companies related to technical consulting and related service ​ (59,439,552) ​ (66,970,818) ​ (73,298,667) Net cash (used in)/ provided by other transactions with intra-Group companies ​ (283,621) ​ 299,452 ​ 639,545 Net cash provided by/ (used in) operating activities 1,548,858 788,498 (333,662) ​ ​ ​ ​ ​ ​ ​ Cash flows from investing activities: ​ ​ ​ ​ ​ ​ Net cash used in transactions with third-parties ​ (39,430) ​ (71,832) ​ (82,645) Net cash used in investing activities (39,430) (71,832) (82,645) ​ ​ ​ ​ ​ ​ ​ Cash flows from financing activities: ​ ​ ​ ​ ​ ​ Net cash used in transactions with intra-Group companies ​ (622,809) ​ (105,448) ​ (52,839) Net cash (used in)/ provided by transactions with third-parties ​ (678,287) ​ (52,541) ​ 15,673 Net cash used in financing activities (1,301,096) (157,989) (37,166) ​ In accordance with various contractual agreements, the Company has the power to direct the activities of the VIEs and can have assets transferred out of the VIEs. Therefore, the Company considers that there are no assets in the respective VIEs that can be used only to settle obligations of the respective VIEs, except for the registered capital of the VIEs amounting to approximately RMB659.7 million and RMB626.1 million, respectively, as of December 31, 2022 and 2023, as well as certain non-distributable statutory reserves amounting to approximately RMB82.4 million and RMB96.3 million, respectively, as of December 31, 2022 and 2023. As the respective VIEs are incorporated as limited liability companies under the PRC Company Law, creditors do not have recourse to the general credit of the Company for the liabilities of the respective VIEs. Currently, there are certain contractual arrangements between the Company and several of VIEs which require the Company to provide additional financial support or guarantees to the VIEs, where necessary. Please see Note 1(b) for additional information. There is no entity in the Company’s group for which the Company has a variable interest but is not the primary beneficiary as of December 31, 2022 and 2023. (b) Nature of operations The Group generates revenues mainly from providing online game services, tutoring services, sales of smart devices, online music services, live streaming services, advertising services, e-commerce and other fee-based premium services. The industry in which the Group operates is subject to a number of industry-specific risk factors, including, but not limited to, rapidly changing technologies; government regulations of the Internet, online game, online education, online music, live streaming and e-commerce industry in China; numbers of new entrants; dependence on key individuals; competition of similar services from larger companies; customer preferences; and the need for the continued successful development, marketing and selling of its services. VIE arrangements with major VIEs The Group conducts its business mainly in China. The Chinese government regulates Internet access, telecommunications services, the distribution of various information and the provision of commerce through strict business licensing requirements and other governmental regulations, which include, among others, those restricting foreign ownership in Chinese companies providing Internet advertising and other Internet or telecommunications value-added services. To comply with the existing Chinese laws and regulations, the Company and certain of its subsidiaries have entered into a series of contractual arrangements with the major VIEs with respect to the operation of the NetEase websites, operation of in-house developed and licensed PC and mobile games, Internet content and wireless value-added services, as well as the provision of advertising services. Based on the agreements with these VIEs, certain of the Company’s subsidiaries provided technical consulting and related services to these VIEs. The principal agreements that transfer economic benefits of Guangzhou NetEase and Hangzhou Leihuo to the Company and its subsidiaries are: ● Cooperative agreements with Guangzhou NetEase - under these agreements, certain of the Company’s subsidiaries, including Boguan and NetEase Hangzhou provide various technical consulting and related services to Guangzhou NetEase in exchange for substantially all of Guangzhou NetEase’s net profits. ● Cooperative agreements with Hangzhou Leihuo - under these agreements, certain of the Company’s subsidiaries, including NetEase Hangzhou provide various technical consulting and related services to Hangzhou Leihuo in exchange for substantially all of Hangzhou Leihuo’s net profits. Each cooperative agreement will remain in effect indefinitely unless any one of the contract parties terminates such agreement by written notice or otherwise required by law. Each VIE, the relevant subsidiary of the Company and the relevant VIE shareholders have entered into a series of agreements that provide the Company with the power to direct the activities that most significantly impact the economic performance of the VIEs and provide the Company with economic benefits of these VIEs and as such the Company is the primary beneficiary and consolidate the VIEs for financial reporting. The principal agreements that provide the Company and its subsidiaries with such power and economic benefits over Guangzhou NetEase are: ● Shareholder Voting Rights Trust Agreement among the VIE shareholders of Guangzhou NetEase and the Company’s subsidiary, NetEase Information Technology (Beijing) Co., Ltd. (“NetEase Beijing”). Each of the VIE shareholders irrevocably appoints NetEase Beijing to represent him to exercise all the voting rights to which he is entitled as a shareholder of Guangzhou NetEase. The term of this agreement is 20 years from May 12, 2010. ● Letter of Agreement. Each of the VIE shareholders of Guangzhou NetEase have agreed that any amendments to be made to the agreements to which the Company, NetEase Beijing and/or their respective affiliates is a party, on the one hand, and any of their variable interest entities and/or the shareholders of such entities, on the other hand, shall be subject to the approval by the vote of a majority of the Board of the Company, excluding the vote of Mr. Ding. The VIE shareholders have also agreed that, if any amendments to the above-mentioned agreements require a vote of the shareholders of the Company or Guangzhou NetEase, as applicable, both of them will vote in their capacity as direct or indirect shareholders of these companies to act based upon the instructions of the Company’s Board. The term of this agreement is 20 years from May 12, 2010. ● Other Governance Arrangements. The parties have agreed that upon the Company’s determination and at any time when NetEase Beijing or its affiliates are able to obtain approval to invest in and operate all or any part of any business operated by Guangzhou NetEase, NetEase Beijing or its affiliates may acquire all or any part of the assets or equity interests of Guangzhou NetEase, to the extent permitted by Chinese law. The principal agreements that provide the Company and its subsidiaries with such power and economic benefits over Hangzhou Leihuo are: ● Operating Agreement among NetEase Hangzhou, Hangzhou Leihuo and the VIE shareholders of Hangzhou Leihuo. To ensure the successful performance of the various agreements between the parties, Hangzhou Leihuo and its VIE shareholders have agreed that, except for transactions in the ordinary course of business, Hangzhou Leihuo will not enter into any transaction that would materially affect the assets, liabilities, rights or operations of Hangzhou Leihuo without the prior written consent of NetEase Hangzhou. NetEase Hangzhou has also agreed that it will provide performance guarantees and, at NetEase Hangzhou’s discretion, guarantee loans for working capital purposes to the extent required by Hangzhou Leihuo for its operations. Furthermore, the VIE shareholders of Hangzhou Leihuo have agreed that, upon instruction from NetEase Hangzhou, they will appoint Hangzhou Leihuo’s board members, president, chief financial officer and other senior executive officers. The term of this agreement is 20 years from December 1, 2015 and can be extended with the written consent of NetEase Hangzhou. ● Shareholder Voting Rights Trust Agreement among NetEase Hangzhou and the VIE shareholders of Hangzhou Leihuo. Under these agreements, each of the VIE shareholders of Hangzhou Leihuo agreed to irrevocably entrust a person designated by NetEase Hangzhou to represent him to exercise all the voting rights and other shareholders’ rights to which he is entitled as a shareholder of Hangzhou Leihuo. Each agreement shall remain effective for as long as the VIE shareholder remains a shareholder of Hangzhou Leihuo unless NetEase Hangzhou unilaterally terminates the agreement by written notice. ● Exclusive Purchase Option Agreements among NetEase Hangzhou, Hangzhou Leihuo and the VIE shareholders of Hangzhou Leihuo. Under the Exclusive Purchase Option Agreements, each of the VIE shareholders has granted NetEase Hangzhou an option to purchase all or a portion of his equity interest in Hangzhou Leihuo at a price equal to the original and any additional paid-in capital paid by the VIE shareholder. In addition, Hangzhou Leihuo has granted NetEase Hangzhou an option to purchase all or a portion of the assets held by Hangzhou Leihuo or its subsidiaries at a price equal to the net book value of such assets. Each of Hangzhou Leihuo and the VIE shareholders of Hangzhou Leihuo agrees not to transfer, mortgage or permit any security interest to be created on any equity interest in or assets of Hangzhou Leihuo without the prior written consent of NetEase Hangzhou. Each Exclusive Purchase Option Agreement shall remain in effect until all of the equity interests in or assets of Hangzhou Leihuo have been acquired by NetEase Hangzhou or its designee or until NetEase Hangzhou unilaterally terminates the agreement by written notice. The principal agreements amongst the other VIEs, the relevant subsidiaries and VIE shareholders that provide the Company with the power to direct the activities that most significantly impact the economic performance of the VIEs and provide the Company with economic benefits of these VIEs contains substantially the same terms as those aforementioned agreements related to Hangzhou Leihuo, except that contract expiry date varies. The Company conducts substantially all of its business through the various VIEs discussed above and their subsidiaries, and therefore these companies directly affect the Company’s financial performance and cash flows. As discussed below, if the Chinese government determines the VIE agreements do not comply with applicable laws and regulations and requires the Company to restructure its operations entirely or discontinue all or any portion of its business, or if the uncertainties in the PRC legal system limit the Group’s ability to enforce these contractual agreements, the Group’s business operations will be significantly disrupted and the Group might be unable to consolidate these companies in the future. In the opinion of management, the likelihood of loss in respect of the Group’s current ownership structure or the contractual arrangements with the VIEs is remote. Risks related to the VIE arrangements The Company believes that its contractual arrangements with the VIEs are in compliance with PRC law and are legally enforceable. Mr. Ding, who is the major shareholder of Guangzhou NetEase and certain of the other VIEs, is the largest shareholder of the Company. He therefore has no current interest in seeking to act contrary to the contractual arrangements. However, uncertainties in the PRC legal system could limit the Company’s ability to enforce these contractual arrangements and if Mr. Ding were to reduce his interest in the Company, his interests may diverge from that of the Company and that may potentially increase the risk that he would seek to act contrary to the contractual terms, for example by influencing the VIEs not to pay the service fees when required to do so. If the VIEs or their respective shareholder fail to perform their respective obligations under the current contractual arrangements, the Company may have to incur substantial costs and expend significant resources to enforce those arrangements and rely on legal remedies under Chinese laws. Many Chinese laws, rules and regulations are relatively new, and because of the limited volume of published decisions and their non-binding nature, the interpretation and enforcement of these laws, rules and regulations involve substantial uncertainties. These uncertainties may impede the ability of the Company to enforce these contractual arrangements, or cause the Company to suffer significant delay or other obstacles in the process of enforcing these contractual arrangements and may materially and adversely affect the results of operations and the financial position of the Company. In addition, many Chinese regulations are subject to extensive interpretive powers of governmental agencies and commissions, and there are substantial uncertainties regarding the interpretation and application of current and future Chinese laws and regulations. Accordingly, the Company cannot be assured that Chinese regulatory authorities will not ultimately take a contrary view to its belief and will not take action to prohibit or restrict its business activities. The relevant regulatory authorities would have broad discretion in dealing with any deemed violations which may adversely impact the financial statements, operations and cash flows of the Company (including the restriction on the Company to carry out the business). If the legal structure and contractual arrangements were found to be in violation of any existing PRC laws and regulations, the PRC government could potentially: ● revoke the Group’s business and operating licenses; ● require the Group to discontinue or restrict operations; ● restrict the Group’s right to collect revenues; ● block the Group’s websites; ● require the Group to restructure the operations in such a way as to compel the Group to establish a new enterprise, re-apply for the necessary licenses or relocate the Group’s businesses, staff and assets; ● impose additional conditions or requirements with which the Group may not be able to comply; or ● take other regulatory or enforcement actions against the Group that could be harmful to the Group’s business. The imposition of any of these penalties may result in a material and adverse effect on the Group’s ability to conduct the Group’s business. In addition, if the imposition of any of these penalties causes the Group to lose the rights to direct the activities of the VIEs or the right to receive their economic benefits, the Group would no longer be able to consolidate the VIEs. The Group does not believe that any penalties imposed or actions taken by the PRC government would result in the liquidation of the Company, its subsidiaries or the VIEs. The Company believes the possibility that it will no longer be able to consolidate the VIEs as a result of the aforementioned risks and uncertainties is remote.

Principal Accounting Policies

Principal Accounting Policies	12 Months Ended
	Dec. 31, 2023
Principal Accounting Policies
Principal Accounting Policies	2. Principal Accounting Policies (a) Basis of consolidation The consolidated financial statements include the financial statements of the Company, its subsidiaries and the VIEs for which the Company is the primary beneficiary with the ownership interests of minority shareholders reported as noncontrolling interests. All significant transactions and balances among the Company, its subsidiaries and the VIEs have been eliminated upon consolidation. The Company consolidates a VIE if the Company has the power to direct matters that most significantly impact the activities of the VIE, and has the obligation to absorb losses or the right to receive benefits of the VIE that could potentially be significant to the VIE. (b) Basis of presentation The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“US GAAP”). The preparation of financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the balance sheet dates and the reported amounts of revenues and expenses during the reporting periods. Actual results might differ from those estimates. Critical accounting estimates and assumptions include, but are not limited to, assessing the following: revenues for in-game virtual items over the estimated average playing period of paying players and impairment of long-term investments. (c) Revenue recognition Revenues from contracts with customers are recognized when control of the promised goods or services is transferred to the Group’s customers, in an amount that reflects the consideration the Group expects to be entitled to in exchange for those goods or services, reduced by estimates for return allowances, promotional discounts, rebates and Value Added Tax (“VAT”). The recognition of revenues involves certain management judgments, including estimated lives of virtual items purchased by game players, estimated breakage of game points, return allowance for goods sold, the estimation of the fair value of an advertising-for-advertising barter transaction, volume sales rebates. The amount and timing of the Group’s revenues could be different if management made different judgments or utilized different estimates. The Group’s revenues are mainly generated from online game services, tutoring services, sale of smart devices, online music services live streaming services, advertising services, e-commerce and other fee-based premium services. Refer to “Note 28 - Segment Information” for disaggregation of revenue. (i) Online game services The Group operates mobile games and PC games. The Group is the principal of substantially all games it operates, including both in-house developed games and licensed games. As these games are hosted on the Group’s servers, the Group has the pricing discretion, and is responsible for the sale and marketing of the games as well as customer services. Fees paid to game developers, app stores and payment platforms are recorded as cost of revenues. Mobile games The Group generates mobile game revenues from the sale of in-game virtual items, including items, avatars, skills, privileges or other in-game consumables, features or functionality, within the games. The Group’s performance obligation is to provide on-going game services to players who purchased virtual items to gain an enhanced game-playing experience. This performance obligation is satisfied over the playing period of the paying players. Accordingly, the Group recognizes the revenues ratably over the estimated average playing period of these paying players. The Group considers the average period that players typically play the games and other game player behavior patterns, as well as various other factors to arrive at the best estimates for the estimated average playing period of the paying players for each game based on historical players’ churn rates. If a new game is launched and only a limited period of paying player data is available, then the Group considers other qualitative factors. While the Group believes its estimates to be reasonable based on available game player information, the Group may revise such estimates based on new information indicating a change in the game player behavior patterns and any adjustments are applied prospectively. PC games The Group sells prepaid points to the end users. Customers can purchase “virtual” prepaid points online or from the vendors who register the points in the Group’s system via debit and credit cards or bank transfers via the online payment platforms, and receive the prepaid point information over the Internet. Customers can use the points to play the Group’s PC games, pay for in-game items and use other fee-based premium services. Proceeds received from the sales of prepaid online points to players are recorded as contract liabilities. The Group earns revenue through providing PC game services to players mainly under two types of revenue models: time-based revenue model and item-based revenue model. For PC games using the time-based model, players are charged based on the time they spend playing games. Revenues are recognized ratably over the game playing period as the performance obligations are satisfied. Under the item-based model, the basic game play functions are free of charge, and players are charged for purchases of in-game items. In-game items have different life patterns: one-time use, limited life and permanent life. Revenues from the sales of one-time use in-game items are recognized upon consumption. Limited life items are either limited by the times of uses (for example, 10 times) or limited by time (for example, three months). Revenues from the sales of limited life in-game items are recognized ratably based on the extent of time passed or expired or the times used. Players are allowed to use permanent life in-game items without any use or time limits. Revenues from the sales of permanent life in-game items are recognized ratably over the estimated average playing period of the paying players. The Group considers the average period that players typically play the games and other game player behavior patterns, as well as various other factors to arrive at the best estimates for the estimated average playing period of the paying players for the permanent in-game items of each PC game based on historical players’ churn rate. This estimate is re-assessed on a quarterly basis. Adjustments arising from the changes of estimated average playing period of the paying players are applied prospectively as such changes are resulted from new information indicating a change in the game player behavior patterns. (ii) Tutoring services The Group offers various types of integrated learning services through Youdao, which primarily cover a wide spectrum of topics and target people from broad age groups through its diverse offerings of tutoring courses and digital learning contents, foreign languages, professional and interest education services as well as IT computer skills, etc. Youdao’s tutoring courses consist of online live streaming and other activities during the online live streaming period, as well as the content playback service. The aforementioned services are highly interdependent and interrelated in the context of the contract and are only considered accessory services to the online live streaming courses and therefore are not distinct and are not sold standalone. Therefore, the Group’s tutoring courses are accounted for as a single performance obligation, which is satisfied over the learning period of the students. Accordingly, the Group recognizes the revenues ratably over the estimated average learning period for different courses. The Group considers the average period that students typically spend time on the courses and other learning behavior patterns to arrive at the best estimates for the estimated learning period for each course based on the estimated learning time customers spend on the courses and the expected number of times customers will take the courses. The Group also offers digital learning contents to customers which are delivered together with online live streaming courses and customized planning services. The customers can either stream the digital learning contents online or download and watch them offline. The downloadable digital learning contents, streaming services, online live streaming courses and customized planning services are considered as distinct performance obligations in the contract. The transaction price is generally collected in advance and allocated to each performance obligation in the contract based on the relative standalone selling prices. The Group recognizes the revenues of downloadable digital learning contents as the performance obligation is satisfied upon the time of delivery. The revenues of streaming services and customized planning services are recognized ratably over the service period. For online live streaming courses, the revenues are recognized ratably over the estimated average learning period. (iii) Smart devices The Group sells smart devices such as dictionary pen, smart learning pad and listening pod through Youdao to customers through retailers or distributors. The Group recognizes revenues when control of the goods is transferred to the customer, which generally occurs upon the delivery to the end customers or upon the delivery to distributors. (iv) Online music services The Group offers online music services through Cloud Music, which mainly include membership subscriptions, sales of digital music album and songs and contents sublicensing on the Group’s online platforms. The Group offers users membership subscription packages which entitled paying subscriber access to the Group’s relevant music contents and other privileged features on its platforms. The subscription fees for these packages are primarily time-based mainly from weekly to yearly and is collected upfront. The receipt of subscription fees is initially recognised as contract liabilities. The Group satisfies its performance obligations throughout the subscription period and revenue from the membership subscriptions is recognised over time. The Group also offers users to purchase exclusive digital music albums and songs which can listen both online and offline. The Group considers that the control has been transferred to customer at time of purchase. As a result, the performance obligation is satisfied and revenue is recognised at a point in time. The Group sublicenses certain of its music contents to other music platforms for a fixed period of one (v) Live streaming services The Group operates live streaming platforms through NetEase CC and Cloud Music whereby users can enjoy live performances provided by the live streaming performers and interact with them on a real time basis free of charge. The Group sells virtual items to users at pre-determined price so that the users gift them simultaneously to live streaming performers to show their support and appreciation. The virtual items sold by the Group comprise of either (i) consumable items or (ii) time-based item, such as privilege titles etc. Under the arrangements with the live streaming performers, the Group shares with them a portion of the revenues derived from the sales of virtual items. Revenues derived from the sale of virtual items are recorded on a gross basis as the Group acts as the principal to fulfill all obligations related to the sale of virtual items. Accordingly, revenue is recognized when the virtual item is delivered and consumed if the virtual item is a consumable item or, in the case of time-based virtual item, recognized ratably over the period each virtual item is made available to the user. (vi) Advertising services The Group derives its advertising revenues principally from short-term online advertising contracts. Advertising service contracts may consist of multiple performance obligations with a typical term of less than three months. In arrangements where the Group has multiple performance obligations, the transaction price is allocated to each performance obligation using the relative stand-alone selling price. The Group generally determines standalone selling prices based on the prices charged to customers. If the performance obligation has not been sold separately, the Group estimates the standalone selling price by taking into consideration of the pricing for advertising areas of the Group’s platform with a similar popularities and advertisements with similar formats and quoted prices from competitors as well as other market conditions. Considerations allocated to each performance obligation is recognized as revenue over the advertisement display period, which is usually within three months. The Group also enters into performance-based advertising arrangements with customers. For example, for cost per mille (“CPM”), or cost per thousand impressions, advertising arrangements with customers, the Group recognizes revenues based on the number of times that the advertisement has been displayed. Certain customers may receive volume rebates, which are accounted for as variable consideration. The Group estimates annual expected rebate volume with reference to their historical results and reduce revenues recognized. (vii) E-commerce The Group’s e-commerce revenue is primarily from its private label consumer lifestyle brand Yanxuan, which was established in April 2016. Yanxuan sells its private label products, including pet supplies, home cleaning products, bedding and other categories which mainly source directly from some excellent manufacturers. The Group is the principal for the online direct sales, as it controls the inventory before they are transferred to customers. The Group has the primary responsibility for fulfilling the contracts, bears the inventory risk, and has sole discretion in establishing the prices. E-commerce revenues from online direct sales are recognized when control of the goods is transferred to the customer, which generally occurs upon delivery to the customer. The Group also provides discount coupons to its customers for use in purchases, which are treated as a reduction of revenue when the related transaction is recognized. Return allowances, which reduce revenue and cost of sales, are estimated using historical experience. Liabilities for return allowances and rights to recover products from customers associated with the Group’s liabilities are recorded as “Accrued liabilities and other payables” and “Inventories”, respectively, on the Group’s consolidated balance sheets. Both of the balances are not material as of December 31, 2021, 2022 and 2023. (viii) Fee-based premium services Fee-based premium services revenues, mostly operated on either consumption-basis or a monthly subscription basis, are derived principally from providing premium online reading and other innovative businesses. Prepaid subscription fees collected from customers are deferred and are recognized as revenue on a straight-line basis by the Group over the subscription period, during which customers can access the premium online services provided by the Group. Fees collected from customer to be consumed to purchase online services are recognized as revenue when related services are rendered. Practical expedients The Group has used the following practical expedients as allowed under ASC 606: (i) The effects of a significant financing component have not been adjusted for contracts which the Group expects, at contract inception, that the period between when the Group transfers a promised good or service to the customer and when the customer pays for that good or service will be one year or less. (ii) The Group applied the portfolio approach in determining the commencement date of consumption of permanent virtual items and the estimated average playing period of paying players for PC games and mobile games for the recognition of online game revenue given that the effect of applying a portfolio approach to a group game players’ behaviors would not differ materially from considering each one of them individually. (iii) The Group elects to expense certain costs to obtain a contract as incurred when the expected amortization period is one year or less. Contract balances Timing of revenue recognition may differ from the timing of invoicing to customers. Accounts receivable represent amounts invoiced and revenue recognized prior to invoicing, when the Group has satisfied its performance obligations and has the unconditional right to payment. The Group’s right to consideration in exchange for goods or services that the Group has transferred to a customer is recognized as a contract asset. Contract assets as of December 31, 2022 and 2023 were not material. A contract liability is the Group’s obligation to transfer goods or services to a customer for which the Group has received consideration (or an amount of consideration is due) from the customer. Refer to Note 16 - Contract liabilities for further information, including changes in contract liabilities during the year. (d) Cost of revenues Costs of revenues consist primarily of revenue sharing cost, staff-related costs, royalty fees related to licensed games, traffic acquisition cost, content acquisition cost, service fees related to online payments, server and bandwidth service fee, depreciation and amortization of severs, computers and software, and other direct costs of providing these services, as well as cost of merchandise sold. These costs are charged to the consolidated statements of operations and comprehensive income as incurred. (e) Research and development costs Research and development costs mainly consist of staff-related costs and technology service costs incurred for the development of online games, as well as development and enhancement of the Group’s new products, websites and application platforms. For internal use software, the Group expenses all costs incurred for the preliminary project stage and post implementation-operation stage of development, and costs associated with repair or maintenance of the existing platforms. Costs incurred in the application development stage are capitalized and amortized over the estimated useful life. Since the amount of the Group’s research and development expenses qualifying for capitalization has been immaterial for the years ended December 31, 2021, 2022 and 2023, as a result, all development costs incurred for development of internal used software have been expensed as incurred. For external use software, costs incurred for development of external use software have not been capitalized for the years ended December 31, 2021, 2022 and 2023, because the period after the date technical feasibility is reached and the time when the software is marketed is short historically, and the amount of costs qualifying for capitalization has been immaterial. (f) Cash, cash equivalent s and time deposits Cash and cash equivalents mainly represent cash on hand, demand deposits placed with large reputable banks in Hong Kong and/or China, and highly liquid investments that are readily convertible to known amounts of cash and with original maturities from the date of purchase with terms of less than three months. As of December 31, 2022 and 2023, there were cash at bank and demand deposits with terms of less than three months denominated in U.S. dollars amounting to approximately US$623.8 million and US$1.6 billion, respectively (equivalent to approximately RMB4.3 billion and RMB11.1 billion, respectively). Time deposits represent time deposits placed with banks with original maturities of three months or more. As of December 31, 2022 and 2023, there were time deposits denominated in U.S. dollars amounting to approximately US$8.4 billion and US$8.6 billion, respectively (equivalent to approximately RMB58.6 billion and RMB61.2 billion, respectively). As of December 31, 2022 and 2023, the Group had approximately RMB48.1 billion and RMB48.5 billion cash and cash equivalents and time deposits held by its PRC subsidiaries and the VIEs, representing 42.6% and 39.3% of total cash and cash equivalents and time deposits of the Group, respectively. As of December 31, 2022 and 2023, the Group had a restricted cash balance approximately RMB2.7 billion and RMB2.8 billion, respectively, comprising as follows (in millions): ​ ​ ​ ​ ​ ​ ​ December 31, December 31, ​ ​ 2022 ​ 2023 ​ ​ RMB ​ RMB Customer deposit of NetEase Pay accounts 2,627.5 2,664.1 Others ​ 71.8 ​ 113.7 Total ​ 2,699.3 ​ 2,777.8 ​ The Group had no other material lien arrangements during 2022 and 2023. (g) Receivables, net The Group’s receivables are subject to the measurement of credit losses within the scope of ASC Topic 326. The impact of new standard was immaterial to the Company. The Group’s accounts receivable, other receivables recorded in prepayments and other current assets and other long-term receivables recorded in other long-term assets are within the scope of ASC Topic 326. Accounts receivable consist primarily of receivables from mobile games services, online music services and advertising services. To estimate expected credit losses, the Group has identified the relevant risk characteristics of its customers and the related receivables and other receivables which include size, type of the services or the products the Group provides, or a combination of these characteristics. Receivables with similar risk characteristics have been grouped into pools. For each pool, the Group considers the past collection experience, current economic conditions, future economic conditions (external data and macroeconomic factors) and changes in the Group’s customer collection trends. This is assessed at each quarter based on the Group’s specific facts and circumstances. The following table sets out the movements of the allowance for expected credit losses for the years ended December 31, 2021, 2022 and 2023 (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ For the year ended December 31, ​ 2021 2022 2023 ​ ​ RMB ​ RMB ​ RMB Balance at the beginning of year 113,253 369,982 403,360 Provisions 265,930 61,393 61,146 Write-offs (9,201) (28,015) (15,944) Balance at the end of year ​ 369,982 ​ 403,360 ​ 448,562 ​ (h) Fair value of financial instruments Accounting guidance defines fair value as the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. When determining the fair value measurements for assets and liabilities required or permitted to be recorded at fair value, the Group considers the principal or most advantageous market in which it would transact and it considers assumptions that market participants would use when pricing the asset or liability. Accounting guidance establishes a fair value hierarchy that requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. A financial instrument’s categorization within the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement. Accounting guidance establishes three levels of inputs that may be used to measure fair value: Level 1 - Observable inputs that reflect quoted prices (unadjusted) for identical assets or liabilities in active markets Level 2 - Include other inputs that are directly or indirectly observable in the marketplace Level 3 - Unobservable inputs which are supported by little or no market activity The Group’s financial instruments include cash and cash equivalents and time deposits, restricted cash, accounts receivable, prepayments and other current assets, short-term investments, accounts payable, short-term loans and accrued liabilities and other payables, which the carrying values approximate their fair value. Please see Note 29 for additional information. (i) Inventories Inventories mainly represent products for the Group’s e-commerce business, are stated at the lower of cost or net realizable value in the consolidated balance sheets. Cost of inventory is determined using the weighted average cost method. Adjustments are recorded to write down the cost of inventory to the estimated net realizable value due to slow-moving merchandise and damaged goods, which is dependent upon factors such as historical and forecasted consumer demand, and promotional environment. The Group takes ownership, risks and rewards of the products purchased. Write downs are recorded in “Cost of revenues” in the consolidated statements of operations and comprehensive income. Certain costs attributable to buying and receiving products, such as purchase freights, are also included in inventories. (j) I nvestments Short-term investments Short-term investments include investments in financial instruments with a variable interest rate indexed to performance of underlying assets, all of which are with an original maturity of less than 12 months. In accordance with ASC 825, for investments in financial instruments with a variable interest rate indexed to performance of underlying assets, the Group elected the fair value method at the date of initial recognition and carried these investments at fair value. Changes in the fair value are reflected in the consolidated statements of operations and comprehensive income as “Other income/(expense)”. Fair value is estimated based on quoted prices of similar products provided by banks at the end of each period. The Group classifies the valuation techniques that use these inputs as Level 2 of fair value measurements. Please see Note 7 and Note 29 for additional information. Long-term investments Long-term investments are mainly comprised of equity investments in publicly traded companies, privately-held companies and limited-partnership. Equity investments in publicly traded companies are reported at fair value as equity investment with readily determinable fair value. Unrealized gains and losses for the years ended December 31, 2021, 2022 and 2023 are recognized in other income/(expense). For investments in common stock or in-substance common stock issued by privately-held companies on which the Group does not have significant influence, and investments in privately-held companies’ shares that are not common stocks or in-substance common stocks, as these equity securities do not have readily determinable fair value, the Group measure these equity securities investments at cost, less impairment, if any, plus or minus changes resulting from observable price changes in orderly transactions for the identical or a similar investment of the same issuer (referred to as the measurement alternative). All gains and losses on these equity securities without readily determinable fair value, realized and unrealized, are recognized in other income /(expense). Investments in common stock or in-substance common stock of investees and limited-partnership investments in which the Group is in a position to exercise significant influence by participating in, but not controlling or jointly controlling, the financial and operating policies are accounted for using the equity method. Management regularly evaluates the impairment of the investments in privately-held companies without readily determinable fair value and equity method investments periodically, or when events or circumstances indicate that the carrying amount may not be recoverable. For investments without readily determinable fair values, management performs a qualitative assessment of the fair value of the equity interest in comparison to its carrying amount to determine if there is an indication of potential impairment. If such indication exists, management estimates the fair value of the investment, and records an impairment in the consolidated statements of operations and comprehensive income to the extent the carrying amount exceeds the fair value. Significant judgments management applies in the impairment assessment for these equity investments include: (i) the determination as to whether any impairment indicators exist during the year; (ii) estimating the impairment amount if an impairment exists; and (iii) judgments as to whether a decline in value of equity method investments was other than temporary. These judgments consider various factors and events including: a) significant deterioration in the earnings performance, credit rating, asset quality, or business prospects of the investees; b) significant adverse change in the regulatory, economic, or technological environment of the investees; c) significant adverse change in the general market condition of either the geographical area or the industry in which the investees operate; d) bona fide offer to purchase, an offer by the investee to sell, or a completed auction process for the same or similar investment for an amount less than the carrying amount of that investment; e) factors that raise significant concerns about the investees’ ability to continue as a going concern; f) factors that raise significant concerns about the performance of new products and g) valuation methods and key estimates in the determination of the impairment amounts. Key estimates mainly comprised the severity and duration of the impairment indicator and the existence of any positive or mitigating factors. For equity method investments, management considers if the investment is impaired when events or circumstances suggest the carrying amount may not be recoverable, and recognizes any impairment charge in the consolidated statements of operations and comprehensive income for a decline in value that is determined to be other than temporary. (k) Leases The Group adopted ASU 2016-02, “Leases (Topic 842)”, including certain transitional guidance and subsequent amendments within ASU 2018-01, ASU 2018-10, ASU 2018-11, ASU 2018-20 and ASU 2019-01 (collectively, including ASU 2016-02, “ASC 842”). Leases that transfer substantially all of the benefits and risks incidental to the ownership of assets are accounted for as finance leases as if there was an acquisition of an asset and incurrence of an obligation at the inception of the lease. All other leases are accounted for as operating leases. As of December 31, 2022 and 2023, the Group has no material finance leases. Under ASC 842, the Group determines if an arrangement is a lease at inception. The Group is the lessee in a lease contract when the Group obtains the right to control the asset. Operating leases are included in operating lease right-of-use (“ROU”) assets, and short-term and long-term operating lease liabilities in the Group’s consolidated balance sheets. ROU assets represent the Group’s right to use an underlying asset for the lease term and lease liabilities represent the Group’s obligation to make lease payments arising from the lease. Operating lease ROU assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. As most of the Group’s leases do not provide an implicit rate, the Group generally uses its incremental borrowing rate based on the estimated rate of interest for collateralized borrowing over a similar term of the lease payments at commencement date. The operating lease ROU asset also includes any lease payments made and excludes lease incentives. Lease expense is recognized on a straight-line basis over the lease term. For leases with a term of twelve months or less (“short-term leases”), the Group has elected not to recognize lease liabilities and associated ROU assets. Lease payments on short-term leases are recognized as lease expense within cost of revenues or operating expenses on the consolidated statements of operations and comprehensive income, depending on the nature of the lease, on a straight-line basis over the lease term. (l) Property, equipment and software Property, equipment and software are stated at cost less accumulated depreciation. Depreciation is calculated on the straight-line basis over the following estimated useful lives, taking into account any estimated residual value: ​ ​ ​ ​ Building 20 years Decoration 5 years Leasehold improvements lesser of the term of the lease and the estimated useful lives of the assets Furniture, fixtures, office and other equipment 3-10 years Vehicles 5 years Servers and computers 3-5 years Software 3 years ​ Repairs and maintenance expenditures, which are not considered improvements and do not extend the useful life of the property and equipment, are expensed as incurred. (m) Land u

Discontinued Operations

Discontinued Operations	12 Months Ended
	Dec. 31, 2023
Discontinued Operations
Discontinued Operations	3. Discontinued Operations In 2022, the Company recognized net income from discontinued operations of RMB624.9 million which was related to the disposal of the Kaola business in 2019.

Acquisition

Acquisition	12 Months Ended
	Dec. 31, 2023
Acquisition
Acquisition	4. Acquisition Acquisitions in 2022 In 2022, the Group completed several acquisitions to complete its existing businesses and achieve synergies. Among them, the Group acquired an additional 50.5% equity interest of a previously held equity investment with total cash consideration of RMB760.4 million. Upon the acquisition, the Group increased its equity interest in this investment from 41.5% to 92.0%, and accounted for it as a consolidated subsidiary of the Group. A gain of RMB310.4 million in relation to the revaluation of the previously held equity interests was recorded in “Investment income, net” in the consolidated statements of operations and comprehensive income for the year ended December 31, 2022. The acquired entities individually and in aggregate were insignificant. The Group’s acquisitions in 2022 are summarized in the following table (in thousands): ​ ​ ​ ​ ​ ​ Amounts ​ RMB Net liabilities acquired (34,671) Amortizable intangible assets (i) Trademark 143,146 Other identified intangible assets 525,853 Deferred tax liabilities (104,137) Goodwill 1,571,206 Noncontrolling interests (122,983) Total 1,978,414 (i) Trademarks and other identified intangible assets acquired in the acquisitions are included in “Copyrights, licenses, domain names, trademark and technology”. There was no significant acquisition incurred in 2023. Pro forma results of operations for all the acquisitions have not been presented because they were not material to the consolidated statements of operations and comprehensive income for the years ended December 31, 2021, 2022 and 2023, either individually or in aggregate.

Concentrations and Risks

Concentrations and Risks	12 Months Ended
	Dec. 31, 2023
Concentrations and Risks
Concentrations and Risks	5. Concentrations and Risks (a) Server and bandwidth service provider The Group relied on over 100 telecommunications service providers and their affiliates for server and bandwidth service to support its operations during fiscal years 2021, 2022 and 2023 as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the year ended December 31, ​ ​ 2021 2022 2023 ​ Number of service providers, offering 10% or more of the Group’s server and bandwidth service expenditure 4 ​ 4 ​ 4 ​ Total% of the Group’s server and bandwidth service expenditure provided by 10% or greater service providers 67.2 % 62.7 % 59.4 % ​ (b) Credit risk Financial instruments that potentially subject the Group to significant concentrations of credit risk consist primarily of cash and cash equivalents, time deposits, restricted cash, accounts receivable and short-term investments. As of December 31, 2022 and 2023, substantially all of the Group’s cash equivalents, time deposits and restricted cash were held in major financial institutions located in the PRC or Hong Kong, which management considers being of high credit quality. Accounts receivable are typically unsecured and are generally derived from revenue earned from mobile games services, online music services and advertising services. One channel had a receivable balance exceeding 10% of the total accounts receivable balance for the year ended December 31, 2022 and 2023, respectively as follows: ​ ​ ​ ​ ​ ​ ​ ​ December 31, December 31, ​ 2022 2023 Channel A 17.8 % 23.5 % ​ Short-term investments consist of financial products issued by commercial banks in China with a variable interest rate indexed to performance of underlying assets, which have a maturity date within one year as of the purchase date. The effective yields of the short-term investments range from 1.85% to 8.31% per annum as of December 31, 2023. Any negative events or deterioration in financial well-being with respect to the counterparties of the above investments and the underlying collateral may cause a material loss to the Group and have a material effect on the Group’s financial condition and results of operations. (c) Major customers No single customer represented 10% or more of the Group’s total net revenues for the years ended December 31, 2021, 2022 and 2023. (d) Online games The Group derived 29.2%, 29.6% and 36.8% of its total net revenues from its top 5 online games for the years ended December 31, 2021, 2022 and 2023, respectively.

Prepayments and Other Current A

Prepayments and Other Current Assets	12 Months Ended
	Dec. 31, 2023
Prepayments and Other Current Assets
Prepayments and Other Current Assets	6. Prepayments and Other Current Assets The following is a summary of prepayments and other current assets (in thousands): ​ ​ ​ ​ ​ ​ ​ December 31, December 31, ​ ​ 2022 ​ 2023 ​ ​ RMB ​ RMB Guarantee payment made to Blizzard - royalty fees 634,909 — Prepayment for royalties, revenue sharing cost 1,787,638 1,729,241 Interest receivable 1,373,854 2,271,944 Prepayments of content and marketing cost and other operational expenses 725,183 638,697 Prepayment for deductible value added tax and refundable subsidy 492,552 581,228 Bridge loans in connection with ongoing investments 43,313 27,369 Deposits 68,285 81,712 Employee advances ​ 61,480 ​ 57,949 Advance to suppliers ​ 105,903 ​ 43,820 Receivable within one - year related to disposal of investments ​ — ​ 512,367 Others 155,167 132,268 ​ 5,448,284 6,076,595 ​ As of December 31, 2022 and 2023, prepayments for royalties and revenue sharing cost mainly represented prepaid royalties or revenue sharing cost related to game distribution and operations of online games. The amount of employee advances listed above included staff housing loan balances of RMB22.7 million and RMB18.2 million repayable within 12 months from December 31, 2022 and 2023 respectively (see Note 12). No advances were made directly or indirectly to the Group’s executive officers for their personal benefit for the years ended December 31, 2022 and 2023.

Short-term Investments

Short-term Investments	12 Months Ended
	Dec. 31, 2023
Short-term Investments
Short-term Investments	7. Short-term Investments As of December 31, 2022 and 2023, the Group’s short-term investments mainly consisted of financial products issued by commercial banks in China with a variable interest rate indexed to the performance of underlying assets and a maturity date within one year when purchased. As of December 31, 2023, the effective yields of short-term investments ranged from 1.85% to 8.31% per annum (2022: 1.72% to 5.00% per annum). The following is a summary of short-term investments (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ December 31, 2022 ​ ​ Unrealized Estimated ​ ​ Cost ​ Gains ​ Fair Value ​ ​ RMB ​ RMB ​ RMB Short-term investments 7,563,805 ​ 58,868 ​ 7,622,673 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ December 31, 2023 ​ ​ Unrealized Estimated ​ ​ Cost ​ Gains ​ Fair Value ​ ​ RMB ​ RMB ​ RMB Short-term investments ​ 4,275,329 ​ 160,728 ​ 4,436,057 ​ During the years ended December 31, 2021, 2022 and 2023, the Group recorded investment income related to short-term investments of RMB639.8 million, RMB342.6 million and RMB414.2 million in the consolidated statements of operations and comprehensive income, respectively.

Property, Equipment and Softwar

Property, Equipment and Software, net	12 Months Ended
	Dec. 31, 2023
Property, Equipment and Software, net
Property, Equipment and Software, net	8. Property, Equipment and Software, net The following is a summary of property, equipment and software (in thousands): ​ ​ ​ ​ ​ ​ ​ December 31, December 31, ​ ​ 2022 ​ 2023 ​ ​ RMB ​ RMB Building and decoration 3,875,063 4,063,468 Leasehold improvements 304,365 311,156 Furniture, fixtures, office and other equipment 379,938 508,185 Vehicles 102,823 106,027 Servers and computers 6,018,709 6,144,176 Software 344,410 367,472 Construction in progress 1,587,413 3,675,879 ​ 12,612,721 15,176,363 ​ ​ ​ ​ ​ Less: accumulated depreciation (6,270,391) (6,923,618) Less: impairment ​ — ​ (177,701) Net book value 6,342,330 8,075,044 ​ Depreciation expense was RMB928.5 million, RMB1,127.2 million and RMB769.7 million for the years ended December 31, 2021, 2022 and 2023, respectively. As of December 31, 2022 and 2023, the construction in progress balance were mainly comprised of construction of buildings in Shanghai and Hangzhou that have not yet been placed in service for the Group’s intended use. All the related cost is capitalized in construction in progress to the extent it is incurred for the purposes of bringing the construction development to a usable state.

Land Use Rights, net

Land Use Rights, net	12 Months Ended
	Dec. 31, 2023
Land Use Rights, net
Land Use Rights, net
Land Use Rights, net	9. Land Use Rights, net ​ Land use rights represent acquired right to use the land on which the Group’s offices and warehouses are built. In 2022 and 2023, the Group obtained the land use rights from the local authorities, including in Guangzhou and Guian. Amortization of the land use right is made over the remaining term of the land use right period from the date when the land was made available for use by the Group. The land use rights are summarized as follows (in thousands): ​ ​ ​ ​ ​ ​ ​ December 31, December 31, ​ ​ 2022 ​ 2023 ​ ​ RMB ​ RMB Cost 4,521,308 4,590,902 Incentive payment from local government (15,000) (15,000) Accumulated amortization (384,541) (486,475) Impairment ​ — ​ (14,284) Land use right, net 4,121,767 4,075,143 ​ The total amortization expense for each of the years ended December 31, 2021, 2022 and 2023 amounted to approximately RMB87.4 million, RMB91.8 million and RMB101.9 million, respectively.

Leases

Leases	12 Months Ended
	Dec. 31, 2023
Leases
Leases	10. Leases The Group has operating leases for corporate offices, warehouses and retail stores. In addition, upon the adoption of ASC 842, land use rights with total carrying amount of RMB4.1 billion each (Note 9) were identified as operating lease right-of-use assets as of December 31, 2022 and 2023, respectively. The Group’s leases have remaining lease terms of 1 month to 67 years, some of which include options to terminate the leases within certain periods. The Group considers these options in determining the classification and measurement of the leases when it is reasonably certain that the Group will exercise that option. The following table provides information related to the Group’s operating leases (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ For the year ended December 31, ​ 2021 2022 2023 ​ ​ RMB ​ RMB ​ RMB Operating lease cost 461,542 ​ 409,196 ​ 344,606 Cash paid for amounts included in the measurement of operating lease liabilities 503,127 ​ 471,214 ​ 331,579 Right-of-use assets obtained in exchange for operating lease obligations 763,919 ​ 336,381 ​ 215,209 ​ Additionally, the short-term lease cost was RMB31.4 million, RMB27.4 million and RMB42.3 million for the year ended December 31, 2021, 2022 and 2023, respectively. The following table provides a summary of the Group’s operating lease terms and discount rates, which excludes the land use rights, as of December 31, 2022 and 2023: ​ ​ ​ ​ ​ ​ ​ ​ December 31, December 31, ​ ​ 2022 ​ 2023 Weighted average remaining lease term 3.22 years 2.92 years ​ Weighted average discount rate 3.82 % 3.77 % ​ Maturities of operating lease liabilities as of December 31, 2023 were as follows (in thousands): ​ ​ ​ ​ ​ RMB 2024 284,976 2025 193,875 2026 132,049 2027 85,279 2028 ​ 83,947 Thereafter 106,998 Total operating lease payments 887,124 Less: imputed interest (71,802) Total 815,322 ​

Long-term Investments

Long-term Investments	12 Months Ended
	Dec. 31, 2023
Long-term Investments
Long-term Investments	11. Long-term Investments The following is a summary of long-term investments (in thousands): ​ ​ ​ ​ ​ ​ ​ December 31, December 31, ​ ​ 2022 ​ 2023 ​ ​ RMB ​ RMB Investments in equity method investees 5,239,242 6,109,240 Equity investments with readily determinable fair values ​ 2,567,268 ​ 3,107,266 Equity investments without readily determinable fair values 10,463,304 12,021,518 Investments accounted for at fair values ​ 246,073 ​ 490,781 Debt investments ​ 28,471 ​ 54,382 ​ 18,544,358 21,783,187 ​ (a) Investments in equity method investees The Group recorded equity share of earnings of RMB1.6 billion, RMB1.3 billion and RMB473.9 million for the years ended December 31, 2021, 2022, and 2023, respectively, which was included in “Investment income, net” in the consolidated statements of operations and comprehensive income. Significant equity method investments are summarized as follows. (1) As of December 31, 2022, the Group invested an aggregated cash consideration of RMB 1.9 billion in five limited partnerships as a limited partner, and in 2023, the Group further contributed totally RMB 128.2 million cash in three of them. The objectives of these limited partnerships are to engage in investment in online game business. The Group accounted such investments under the equity method. (2) In August 2013, the Group established a joint venture with China Telecom Corp. Ltd. (“China Telecom”), Zhejiang Yixin Technology Co., Ltd. (formerly known as Hangzhou Yixin Technology Co., Ltd.) (“Yixin”) to launch “YiChat”, a proprietary social instant messaging application for smart phones. The Group contributed RMB 200.0 million cash in exchange for a 27.0% equity interest in Yixin. In July 2015, the Group increased its equity shares in Yixin to 35.0% with a cash consideration of approximately RMB 127.5 million. Full impairment amounted to RMB 197.7 million was made for this investment due to the investee not performing to expectation for the year ended December 31, 2022. (b) Equity investments with readily determinable fair values As of December 31, 2023, equity investments with readily determinable fair values mainly included RMB991.6 million invested in shares of AppLovin Corporation, RMB983.4 million invested in shares of Alibaba Group Holding Limited, RMB493.0 million invested in shares of Shenzhen Transsion Holding Limited, RMB419.0 million invested in shares of Huatai Securities Company Limited and RMB152.9 million invested in shares of Embracer Group AB (publ). The Group recorded fair value gain of RMB91.1 million, fair value loss of RMB3.4 billion and fair value gain of RMB535.3 million related to the equity investments with readily determinable fair value for the year ended December 31, 2021, 2022 and 2023, respectively. The Group also recorded cash dividend income of RMB18.9 million, RMB26.5 million and RMB51.0 million from these investments for the years ended December 31, 2021, 2022 and 2023, respectively. (c) Equity investments without readily determinable fair value Equity investments without readily determinable fair value represent investments in privately held companies with no readily determinable fair value. The Group does not have significant influence on these investees, or the investments are not common stock or in substance common stock. These investments are classified as equity investments without readily determinable fair value, and are carried at cost less impairment, plus or minus changes resulting from observable price changes in orderly transactions for the identical or a similar investment of the same issuer. For the year ended December 31, 2021, 2022 and 2023, RMB380.8 million, nil and nil upward adjustments to the carrying value of equity securities without readily determinable fair value resulted from such transactions were recognized as “Investment income, net” in the consolidated statements of operations and comprehensive income, respectively. The Group recognized a gain of RMB172.5 million, RMB1,784.9 million and RMB22.3 million related to the disposal of the Group’s investments in equity securities without readily determinable fair value as “Investment income, net” in the consolidated statements of operations and comprehensive income for the years ended December 31, 2021, 2022 and 2023, respectively. The Group recognized impairment provision of RMB19.2 million, RMB85.2 million and RMB274.2 million related to certain of the equity investments without readily determinable fair value as “Investment income, net” in the consolidated statements of operations and comprehensive income for the years ended December 31, 2021, 2022 and 2023, respectively.

Other Long-term Assets

Other Long-term Assets	12 Months Ended
	Dec. 31, 2023
Other Long-term Assets
Other Long-term Assets	12. Other Long-term Assets The following is a summary of other long-term assets (in thousands): ​ ​ ​ ​ ​ ​ ​ December 31, December 31, ​ ​ 2022 ​ 2023 ​ ​ RMB ​ RMB Copyrights, licenses, domain names, trademark and technology 2,117,688 1,884,603 Goodwill ​ 2,166,486 ​ 1,855,394 Long-term receivable ​ 1,638,572 ​ 1,500,100 Non-current deposits ​ 174,357 ​ 179,399 Long-term interest receivables ​ 100,397 ​ 38,174 Staff housing loans 39,228 34,690 Others 569,727 446,746 ​ 6,806,455 5,939,106 ​ Balances of copyrights and licenses represents prepaid minimum royalties for exploitation of related intellectual properties, which was amortized over the term of the respective licensing agreements or estimated amortization periods. Goodwill ​ ​ ​ ​ ​ ​ ​ ​ December 31, ​ December 31, ​ 2022 2023 ​ ​ RMB ​ RMB Beginning balance 595,280 2,166,486 Additions 1,571,206 — Disposal ​ — ​ (311,092) Ending balance 2,166,486 1,855,394 ​ For the years ended December 31, 2022 and 2023, the carrying value of goodwill was mainly recorded under the games and related value-added services segment.The Group performed impairment tests using the qualitative and quantitative method and concluded that the goodwill was not impaired as at December 31, 2022 and 2023, therefore, no provision was recorded. The Group made housing loans to its employees (excluding executive officers) for house purchases via a third-party commercial bank in China. Each individual staff housing loan is collateralized either by the property for which the loan is extended or by approved personal guarantees for the loan amount granted. The repayment term is five years from the date of drawdown. The interest rate is fixed varying from 2.1% to 4.75% per annum both for the years ended December 31, 2022 and 2023, respectively. The outstanding portion of the staff housing loans repayable within 12 months as of December 31, 2022 and 2023 amounted to approximately RMB22.7 million and RMB18.2 million, respectively. The amounts are reported under “Prepayments and other current assets” in the consolidated balance sheets (see Note 6).

Taxation

Taxation	12 Months Ended
	Dec. 31, 2023
Taxation
Taxation	13. Taxation (a) Income taxes Cayman Islands Under the current laws of the Cayman Islands, the Company, and its intermediate holding companies in the Cayman Islands are not subject to tax on income or capital gain. Additionally, upon payments of dividends by the Company or its subsidiaries in the Cayman Islands to their shareholders, no Cayman Islands withholding tax will be imposed. British Virgin Islands (“BVI”) Subsidiaries in the BVI are exempted from income tax on its foreign-derived income in the BVI. There are no withholding taxes in the BVI. Hong Kong Subsidiaries in Hong Kong are subject to 16.5% income tax on their taxable income generated from operations in Hong Kong. For the years ended December 31, 2021, 2022 and 2023, the first HK$2 million of profits earned by one of the Company’s subsidiaries incorporated in Hong Kong is taxed at half the current tax rate (i.e., 8.25%) while the remaining profits will continue to be taxed at the existing 16.5% tax rate. The payments of dividends by these companies to their shareholders are not subject to any Hong Kong withholding tax. China Under the EIT Law, Foreign Invested Enterprises (“FIEs”) and domestic companies would be subject to EIT at a uniform rate of 25%. Preferential tax treatments will continue to be granted to FIEs or domestic companies which conduct businesses in certain encouraged sectors and to entities otherwise classified as “Software Enterprises”, “Key Software Enterprises” and/or “High and New Technology Enterprises” (“HNTEs”). The EIT Law became effective on January 1, 2008. Boguan, NetEase Hangzhou and certain other PRC subsidiaries were qualified as HNTEs and enjoyed a preferential tax rate of 15% for 2021, 2022 and 2023. The aforementioned preferential tax rates are subject to annual review by the relevant tax authorities in China. The following table presents the combined effects of EIT exemptions and tax rate reductions enjoyed by the Group for the years ended December 31, 2021, 2022 and 2023 (in thousands except per share data): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the year ended December 31, ​ 2021 2022 2023 ​ ​ RMB ​ RMB ​ RMB Aggregate amount of EIT exemptions and tax rate reductions 2,238,907 2,631,764 3,228,359 Earnings per share effect, basic 0.67 0.81 1.00 Earnings per share effect, diluted 0.66 0.80 0.99 ​ The following table sets forth the component of income tax expenses of the Group for the years ended December 31, 2021, 2022 and 2023 (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the year ended December 31, ​ 2021 2022 2023 ​ ​ RMB ​ RMB ​ RMB Current tax expense 3,720,321 4,542,168 4,568,267 Deferred tax expense 407,948 489,670 131,437 Income tax expenses 4,128,269 5,031,838 4,699,704 ​ The following table presents a reconciliation of the differences between the statutory income tax rate and the Group’s effective income tax rate for the years ended December 31, 2021, 2022 and 2023: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the year ended December 31, ​ 2021 2022 2023 ​ ​ % ​ % ​ % Statutory income tax rate 25.0 25.0 25.0 Permanent differences (2.7) (5.0) (7.1) Effect due to different tax rates applicable to overseas entities (1.8) 0.2 0.2 Effect of lower tax rate applicable to HNTEs (10.1) (10.1) (9.5) Change in valuation allowance 3.9 1.8 0.6 Effect of withholding income tax (d) 5.3 8.8 4.6 Effective income tax rate 19.6 20.7 13.8 ​ As of December 31, 2023, certain entities of the Group had net operating tax loss carry forwards of RMB20.7 billion, which is mainly from its PRC subsidiaries and VIEs with expiration period from 2024 to 2033. ​ Full valuation allowance was provided on the related deferred tax assets as the Group’s management does not believe that sufficient positive evidence exists to conclude that recoverability of such deferred tax assets is more likely than not to be realized. (b) Sales tax Pursuant to the provision regulation of the PRC on VAT and its implementation rules, the Company’s subsidiaries and the VIEs are generally subject to VAT at a rate of 6% from revenues earned from services provided or 16% from sales of general goods, which was reduced to 13% effective from 1 April, 2019. (c) Deferred tax assets and liabilities The following table presents the tax impact of significant temporary differences that give rise to the deferred tax assets and liabilities as of December 31, 2022 and 2023 (in thousands): ​ ​ ​ ​ ​ ​ ​ December 31, December 31, ​ ​ 2022 ​ 2023 ​ ​ RMB ​ RMB Deferred tax assets: ​ ​ ​ ​ Contract liabilities, primarily for advanced payments from online games customers 1,009,624 1,043,715 Accruals 654,348 808,527 Depreciation and amortization 7,100 2,180 Net operating tax loss carry forward 3,781,233 3,424,344 ​ 5,452,305 5,278,766 Less: valuation allowance (3,971,516) (3,718,678) Total 1,480,789 1,560,088 ​ ​ ​ ​ ​ ​ ​ December 31, December 31, ​ ​ 2022 ​ 2023 ​ ​ RMB ​ RMB Deferred tax liabilities: ​ ​ ​ ​ Withholding income tax (d) 1,947,190 2,165,573 Others 178,930 133,730 Total 2,126,120 2,299,303 ​ The Group does not believe that sufficient positive evidence exists to conclude that the recoverability of deferred tax assets of certain entities of the Group is more likely than not to be realized. Consequently, the Group has provided full valuation allowances for certain entities of the Group on the related deferred tax assets. The following table sets forth the movement of the aggregate valuation allowances for deferred tax assets for the periods presented (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ Balance at Net change Balance at ​ ​ January 1 ​ for the year ​ December 31 ​ ​ RMB ​ RMB ​ RMB 2021 3,255,854 ​ 393,016 ​ 3,648,870 2022 3,648,870 ​ 322,646 ​ 3,971,516 2023 3,971,516 ​ (252,838) ​ 3,718,678 ​ (d) Withholding income tax The EIT Law also imposes a withholding income tax of 10% on dividends distributed by an enterprise in China to its non-resident enterprise investors. A lower withholding income tax rate of 5% is applied if the non-resident enterprise investor is registered in Hong Kong with at least 25% equity interest in the PRC enterprise and meets the relevant conditions or requirements pursuant to the tax arrangement between mainland China and Hong Kong. On February 22, 2008, the Ministry of Finance and State Taxation Administration jointly issued a circular which stated that for FIEs, all profits accumulated up to December 31, 2007 are exempted from withholding tax when they are distributed to foreign investors. The Group accrued RMB1.1 billion, RMB2.1 billion and RMB1.5 billion (US$214.7 million) withholding tax liabilities associated with all of its earnings expected to be distributed from its PRC subsidiaries to overseas for general corporate purposes in 2021, 2022 and 2023, respectively. The Group have repatriated a portion of these earnings and paid related withholding income tax in 2021, 2022 and 2023. As of December 31, 2022 and 2023, deferred tax liabilities were fully provided related to undistributed earnings of the Group’s PRC subsidiaries.

Taxes Payable

Taxes Payable	12 Months Ended
	Dec. 31, 2023
Taxes Payable
Taxes Payable	14. Taxes Payable The following is a summary of taxes payable as of December 31, 2022 and 2023 (in thousands): ​ ​ ​ ​ ​ ​ ​ December 31, December 31, ​ ​ 2022 ​ 2023 ​ ​ RMB ​ RMB Sales Tax payable 290,272 277,201 Withholding individual income taxes for employees 306,861 378,103 EIT payable 2,116,014 1,790,393 Others 99,949 125,837 ​ 2,813,096 2,571,534 ​

Short-term Loans

Short-term Loans	12 Months Ended
	Dec. 31, 2023
Short-term Loans
Short-term Loans	15. Short-term Loans As of December 31, 2022 and 2023, the short-term loans balances represent short-term loan arrangements with financial institutions which were repayable within a maturity term ranging from one week to one year and charged at a fixed interest rates ranging 0.65% and 5.85% per annum. As of December 31, 2022 and 2023, the weighted average interest rate for the outstanding short-term loans was approximately 4.36% and 3.79%, respectively. The short-term loans are mainly denominated in RMB and US$. The Group has entered into several uncommitted loan credit facility agreements provided by certain financial institutions. As of December 31, 2023, US$3.1 billion of such credit facilities has not been utilized. The Group has also entered into several guarantee agreements in the aggregate amount of US$2.3 billion in respect of certain credit facilities taken by the Company and its subsidiaries. As at December 31, 2023, US$1.1 billion of such credit facilities had not been utilized.

Contract Liabilities

Contract Liabilities	12 Months Ended
	Dec. 31, 2023
Contract Liabilities
Contract Liabilities	16 . Contract Liabilities Contract liabilities represents sales proceeds from prepaid points sold, unamortized mobile game in-game spending, prepaid products fees before delivery and prepaid subscription fees for internet value-added services for which services are yet to be provided as of the balance sheet dates. For the year ended December 31, 2023, the additions to the contract liabilities balance were primarily due to cash payments received or due in advance of satisfying the Group’s performance obligations, while the reductions to the contract liabilities balance were primarily due to the recognition of revenues upon fulfillment of the Group’s performance obligations, both of which were in the ordinary course of business. During the year ended December 31, 2022 and 2023, RMB11.8 billion and RMB12.0 billion of revenues recognized were included in the contract liabilities balance at the beginning of the year, respectively. As of December 31, 2023, the aggregate amount of transaction price allocated to the unsatisfied performance obligations is RMB14.0 billion, which was recorded under contract liabilities and to be recognized as revenues in future periods. The Group expects to recognize RMB13.4 billion as revenues over the next 12 months, and the remaining unsatisfied performance obligations expected to be recognized thereafter was recognized in other long-term liabilities. This balance does not include an estimate for variable consideration arising from sales rebates to advertising service customers and estimated breakage for online points. ​

Accrued Liabilities and Other P

Accrued Liabilities and Other Payables	12 Months Ended
	Dec. 31, 2023
Accrued Liabilities and Other Payables
Accrued Liabilities and Other Payables	17 . Accrued Liabilities and Other Payables The following is a summary of accrued liabilities and other payables as of December 31, 2022 and 2023 (in thousands): ​ ​ ​ ​ ​ ​ ​ December 31, December 31, ​ ​ 2022 ​ 2023 ​ ​ RMB ​ RMB Customer deposits on NetEase Pay accounts 3,113,107 3,268,237 Marketing expenses and promotion materials 2,046,559 3,063,280 Content cost ​ 1,703,218 ​ 1,432,706 Accrued fixed assets related payables 635,566 1,027,401 Accrued revenue sharing 1,032,559 969,903 Professional fees and technical charges 595,491 789,955 Administrative expenses and other staff related cost ​ 414,214 ​ 448,926 Deferred government grants ​ 179,961 ​ 356,239 Acquisition considerations ​ 203,584 ​ 204,229 Server and bandwidth service fees ​ 246,243 ​ 196,202 Customer refund for licensed games ​ 283,763 ​ 97,301 Accrued freight and warehousing charge ​ 105,356 ​ 83,902 Others 562,401 732,625 ​ 11,122,022 12,670,906 ​

Long-term Loans

Long-term Loans	12 Months Ended
	Dec. 31, 2023
Long-term Loans
Long-term Loans	18. Long-term Loans ​ On June 2, 2021, the Group entered into a five-year term loan facility and revolving loan facility agreement with aggregate commitments of US$1.0 billion. The facility is priced at 85 basis points per annum over LIBOR and has a commitment fee of 0.20% on the undrawn portion. There were US$500.0 million and nil of borrowings outstanding under the syndicated facility with no pledge as of December 31, 2022 and 2023, respectively. In early 2024, the Group voluntarily canceled this loan facility.

Noncontrolling Interests and Re

Noncontrolling Interests and Redeemable Noncontrolling Interests	12 Months Ended
	Dec. 31, 2023
Noncontrolling Interests and Redeemable Noncontrolling Interests
Noncontrolling Interests and Redeemable Noncontrolling Interests	1 9. Noncontrolling Interests and Redeemable Noncontrolling Interests Cloud Music In 2018 and 2019, Cloud Music issued preferred shares (“Cloud Music Preferred Shares”) to certain investors. The Cloud Music Preferred Shares were entitled to certain preferences and privileges with respect to redemption. The Group determined that the preferred shares should be classified as redeemable noncontrolling interests since they are contingently redeemable upon the occurrence of a conditional event or a deemed redemption event, which is not solely within the control of the Group. The redemption price equals to the net initial investment amount plus annual interests, if any. Upon completion of the IPO of Cloud Music in December 2021, all Cloud Music Preferred Shares held by external preferred shareholders were automatically re-designated and converted on a one-for-one basis into ordinary shares of Cloud Music. Youdao In April 2018, Youdao issued equity interests with preferential rights (“Youdao Preferred Shares”) to two investors for a total cash consideration of US$70.0 million. The Group determined that the equity interests with preferential rights should be classified as redeemable noncontrolling interest since they are contingently redeemable upon the occurrence of a conditional event, which is not solely within the control of the Company. The redemption price equals to the net initial investment amount plus annual interests. Upon completion of the IPO of Youdao in October 2019, all Youdao Preferred Shares held by external preferred shareholders were automatically re-designated and converted on a one-for-one basis into Class A ordinary shares of Youdao. Each issuance of the preferred shares is recognized at the respective issue price at the date of issuance net of issuance costs. The Group records accretions on the redeemable noncontrolling interest to the redemption value from the issuance dates to the earliest redemption dates if redemption is probable. The accretions using the effective interest method, are recorded as deemed dividends to preferred shareholders, which reduces retained earnings and equity classified noncontrolling interests, and earnings available to common shareholders in calculating basic and diluted earnings per share.

Capital Structure

Capital Structure	12 Months Ended
	Dec. 31, 2023
Capital Structure
Capital Structure	20. Capital Structure The holders of ordinary shares in the Company are entitled to one vote per share and to receive ratably such dividends, if any, as may be declared by the board of directors of the Company. In the event of liquidation, the holders of ordinary shares are entitled to share ratably in all assets remaining after payment of liabilities. The ordinary shares have no preemptive, conversion, or other subscription rights.

Employee Benefits

Employee Benefits	12 Months Ended
	Dec. 31, 2023
Employee Benefits
Employee Benefits	21. Employee Benefits The Company’s subsidiaries and the VIEs incorporated in China participate in a government-mandated multi-employer defined contribution plan under which certain retirement, medical, housing and other welfare benefits are provided to employees. Chinese labor regulations require the Company’s Chinese subsidiaries and the VIEs to pay to the local labor bureau a monthly contribution at a stated contribution rate based on the monthly basic compensation of qualified employees. The relevant local labor bureau is responsible for meeting all retirement benefit obligations; hence, the Group has no further commitments beyond its monthly contribution. The following table presents the Group’s employee welfare benefits expense, which is mainly related to its Chinese subsidiaries and the VIEs, for the years ended December 31, 2021, 2022 and 2023 (in millions): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the year ended December 31, ​ 2021 2022 2023 ​ ​ RMB ​ RMB ​ RMB Contributions to medical and pension schemes 1,463.8 1,710.4 1,786.5 Other employee benefits 1,044.5 1,202.8 1,398.1 ​ 2,508.3 2,913.2 3,184.6 ​

Share-based Compensation

Share-based Compensation	12 Months Ended
	Dec. 31, 2023
Share-based Compensation
Share-based Compensation	22. Share-based Compensation For the years ended December 31, 2021, 2022 and 2023, total share-based compensation expenses recognized were RMB3.0 billion, RMB3.2 billion and RMB3.2 billion, respectively. The table below presents a summary of the Group’s share-based compensation cost (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the year ended December 31, ​ 2021 2022 2023 ​ ​ RMB ​ RMB ​ RMB Cost of revenues 833,389 758,413 823,765 Selling and marketing expenses 118,611 120,171 132,801 General and administrative expenses 1,105,547 1,214,995 1,119,018 Research and development expenses 983,945 1,080,581 1,167,226 ​ 3,041,492 3,174,160 3,242,810 ​ ( a ) Restricted Share Units Plan 2009 RSU Plan In November 2009, the Company adopted 2009 Restricted Share Unit Plan for the Company’s employees, directors and consultants (the “2009 RSU Plan”). The Company has reserved 323,694,050 ordinary shares for issuance under the plan. The 2009 RSU Plan was adopted by a resolution of the board of directors on November 17, 2009 and became effective for a term of ten years unless sooner terminated. The 2009 RSU Plan was expired on November 16, 2019. 2019 Share Plan In October 2019, the Company adopted 2019 Restricted Share Unit Plan for the Company’s employees, directors and others, with a ten-year term and a maximum number of 322,458,300 ordinary shares available for issuance pursuant to all awards under the plan. Effective February 22, 2023, the Company amended and restated the 2019 Restricted Share Unit Plan to permit to grant stock option awards to the Company’s employees, directors and others, and renamed it as Amended and Restated 2019 Share Incentive Plan (the “2019 Share Plan”). The Group recognizes share-based compensation cost related to RSUs in the consolidated statements of operations and comprehensive income based on awards ultimately expected to vest, after considering estimated forfeitures. Forfeitures are estimated based on the Group’s historical experience over the last five years and revised in subsequent periods if actual forfeitures differ from those estimates. As of December 31, 2023, total unrecognized compensation cost related to unvested awards under the 2009 RSU Plan and the 2019 Share Plan, adjusted for estimated forfeitures, was US$365.3 million (RMB2.6 billion) and is expected to be recognized through the remaining vesting period of each grant. As of December 31, 2023, the weighted average remaining vesting periods was 1.48 years. Restricted Share Unit Award Activities The following table presents a summary of the Company’s RSUs award activities for the years ended December 31, 2021, 2022 and 2023: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Weighted average ​ ​ ​ ​ ​ grant date fair ​ ​ Number of RSUs value ​ ​ ​ (in thousands) ​ US$ ​ Outstanding at January 1, 2021 14,096 57.85 Granted 4,579 110.19 Vested (5,067) 58.02 Forfeited (612) 75.29 Outstanding at December 31, 2021 12,996 75.40 ​ ​ ​ ​ ​ ​ Outstanding at January 1, 2022 12,996 75.40 Granted 5,335 93.98 Vested (4,630) 75.01 Forfeited (696) 84.55 Outstanding at December 31, 2022 13,005 82.67 ​ ​ ​ ​ ​ ​ Outstanding at January 1, 2023 13,005 82.67 Granted 4,795 84.73 Vested (5,190) 76.27 Forfeited (523) 88.24 Outstanding at December 31, 2023 12,087 86.00 ​ The aggregate intrinsic value of RSUs outstanding as of December 31, 2023 was US$1.1 billion. The intrinsic value was calculated based on the Company’s closing stock price of US$93.16 per ADS as of December 31, 2023. The Company’s practice is to issue new shares or utilize treasury stock upon vesting of RSUs. The number of shares available for future grant under the Company’s 2019 RSU Plan was 236,724,510 as of December 31, 2023. (b) Other Share Incentive Plan Certain of the Company’s subsidiaries have adopted stock incentive plans, most of which are stock option plans and allow the related subsidiaries to grant options to certain employees of the Group. The options expire in four The Group has used the binomial model to estimate the fair value of the options granted. For the years ended December 31, 2021, 2022, and 2023, RMB528.2 million, RMB327.9 million and RMB289.0 million compensation expenses were recorded for the share options granted. As of December 31, 2023, there were approximately RMB21.0 million unrecognized share-based compensation expenses related to share options for which the service condition had been met and are expected to be recognized when the vesting conditions are achieved.

Net Income Per Share

Net Income Per Share	12 Months Ended
	Dec. 31, 2023
Net Income Per Share
Net Income Per Share	23. Net Income Per Share The following table sets forth the computation of basic and diluted net income per share for the years ended December 31, 2021, 2022 and 2023: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the year ended December 31, ​ 2021 2022 2023 Numerator (RMB in thousands): ​ ​ ​ ​ ​ ​ Net income from continuing operations attributable to the Company’s shareholders ​ 16,856,842 ​ 19,712,736 ​ 29,416,552 Net income from discontinued operations attributable to the Company’s shareholders ​ — ​ 624,864 ​ — Net income attributable to the Company’s shareholders for basic/dilutive net income per share calculation 16,856,842 20,337,600 29,416,552 ​ ​ ​ ​ ​ ​ ​ Denominator (No. of shares in thousands): ​ ​ ​ ​ ​ ​ Weighted average number of ordinary shares outstanding, basic 3,325,864 3,263,455 3,216,475 Dilutive effect of restricted share units ​ 41,614 ​ 32,559 ​ 35,554 Weighted average number of ordinary shares outstanding, diluted ​ 3,367,478 ​ 3,296,014 ​ 3,252,029 Net income per share from continuing operations attributable to the Company’s shareholders, basic (RMB) ​ 5.07 ​ 6.04 ​ 9.15 Net income per share from discontinued operations attributable to the Company’s shareholders, basic (RMB) ​ — ​ 0.19 ​ — Net income per share, basic (RMB) 5.07 6.23 9.15 Net income per share from continuing operations attributable to the Company’s shareholders, diluted (RMB) ​ 5.01 ​ 5.98 ​ 9.05 Net income per share from discontinued operations attributable to the Company’s shareholders, diluted (RMB) ​ — ​ 0.19 ​ — Net income per share, diluted (RMB) 5.01 6.17 9.05 ​ Basic net income per share is computed using the weighted average number of the ordinary shares outstanding during the year. Diluted net income per share is computed using the weighted average number of ordinary shares and potential ordinary shares outstanding during the year. For the years ended December 31, 2021, 2022 and 2023, RSUs that were anti-dilutive and excluded from the calculation of diluted net income per share totaled approximately 6.7 million shares, 11.3 million shares and 6.3 million shares, respectively.

Commitments and Contingencies

Commitments and Contingencies	12 Months Ended
	Dec. 31, 2023
Commitments and Contingencies
Commitments and Contingencies	24 . Commitments and Contingencies (a) Commitments As of December 31, 2023, future minimum payment for server and bandwidth service fee commitments, capital commitments, royalties and other expenditures commitments related to licensed contents, as well as other commitments related to services purchases, were as follows (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Server and ​ ​ ​ Royalties and ​ ​ ​ ​ ​ ​ Bandwidth ​ ​ ​ Expenditure for ​ ​ ​ ​ ​ ​ Service Fee ​ Capital ​ Licensed Content ​ Other ​ ​ ​ Commitments Commitments Commitments Commitments Total ​ ​ RMB ​ RMB ​ RMB ​ RMB ​ RMB 2024 439,118 ​ 1,473,870 ​ 688,387 ​ 297,149 ​ 2,898,524 2025 366,162 ​ 341,700 ​ 271,125 ​ 4,756 ​ 983,743 2026 212,431 ​ 55,446 ​ 215,376 ​ 474 ​ 483,727 2027 ​ 102,479 ​ 33,439 ​ 99,876 ​ — ​ 235,794 Beyond 2027 188,776 ​ 38,744 ​ — ​ — ​ 227,520 ​ 1,308,966 ​ 1,943,199 ​ 1,274,764 ​ 302,379 ​ 4,829,308 ​ (b) Litigation Overview From time to time, the Group is involved in claims and legal proceedings that arise in the ordinary course of business. Based on currently available information, management does not believe that the ultimate outcome of these unresolved matters, individually and in the aggregate, is reasonably possible to have a material adverse effect on the Group’s financial position, results of operations or cash flows. However, litigation is subject to inherent uncertainties and the Group’s view of these matters may change in the future. Were an unfavorable outcome to occur, there exists the possibility of a material adverse impact on the Group’s financial position, results of operations or cash flows for the period in which the unfavorable outcome occurs, and potentially in future periods. The Group records a liability when it is both probable that a liability has been incurred and the amount of the loss can be reasonably estimated. The Group reviews the need for any such liability on a regular basis. The Group has not recorded any material liabilities in this regard as of December 31, 2022 and 2023. Litigation In April 2018, PUBG Corporation and PUBG Santa Monica, Inc. (now known as Krafton, Inc. and Krafton Americas, Inc., respectively, or “the Krafton Parties”), filed a lawsuit against defendants NetEase, Inc., NetEase Information Technology Corp. and NetEase (Hong Kong) Limited in the U.S. District Court for the Northern District of California. The Krafton Parties subsequently dropped all claims against NetEase (Hong Kong) Limited, and added Hong Kong NetEase Interactive Entertainment Limited to the lawsuit. The Krafton Parties’ complaint generally alleged that two of the Group’s mobile games, Rules of Survival and Knives Out, infringed the Krafton Parties’ copyrights and trade dress in their competing game, Player Unknown’s Battlegrounds. On March 11, 2019, the Group entered into a settlement agreement with the Krafton Parties, and the lawsuit was dismissed. On October 15, 2019, the Krafton Parties filed a second lawsuit against the same NetEase defendants, also in the U.S. District Court for the Northern District of California, claiming the Group had allegedly breached the settlement agreement. On March 3, 2020, the court dismissed the Krafton Parties’ new lawsuit, without prejudice, for lack of subject matter jurisdiction. On March 4, 2020, the Group initiated a declaratory judgment action against the Krafton Parties in the Superior Court of California for the County of San Mateo, requesting a declaration that the Group had not breached the settlement agreement. On March 13, 2020, the Krafton Parties filed a cross claim, realleging that the Group breached the settlement agreement. In May 2023, the court held a bench trail and subsequently found that the Group had breached such settlement agreement and awarded the Krafton Parties US$6 million in liquidated damages but denied a request for injunctive relief by the Krafton Parties. After the court issued its final statement of decision, the parties settled the matter to avoid further litigation. There was no material impact on the Group’s consolidated financial statements.

Dividends

Dividends	12 Months Ended
	Dec. 31, 2023
Dividends
Dividends	25 . Dividends Quarterly Dividend Policy Under the Company’s current dividend policy, the determination to make dividend distributions and the amount of such distributions in any particular quarter will be made at the discretion of the Company’s board of directors and will be based upon its operations and earnings, cash flow, financial condition, capital and other reserve requirements and surplus, any applicable contractual restrictions, the ability of the Company’s PRC subsidiaries to make distributions to their offshore parent companies, and any other conditions or factors which the board deems relevant and having regard to the directors’ fiduciary duties. Dividends are recognized when declared. There is no significant dividend payable as of December 31, 2022 and 2023, respectively. The cash dividend declared related to the net profits of fiscal year 2022 and fiscal year 2023 was RMB6.3 billion and RMB11.7 billion (US$1.7 billion) in total, respectively.

Share Repurchase Programs

Share Repurchase Programs	12 Months Ended
	Dec. 31, 2023
Share Repurchase Programs
Share Repurchase Programs	26. Share Repurchase Programs The Company accounts for repurchased ordinary shares under the cost method and includes such treasury stock as a component of the common shareholders’ equity. Cancellation of treasury stock is recorded as a reduction of ordinary shares, additional paid-in-capital and retained earnings, as applicable. An excess of purchase price over par value is allocated to additional paid-in-capital first with any remaining excess charged entirely to retained earnings. The Company may from time to time utilize treasury stock upon vesting of RSUs. The cost of treasury stock reissued is determined using the weighted average method and recorded as a reduction of additional paid-in-capital. In February 2021, the Company announced that its board of directors had approved a share repurchase program of up to US$2.0 billion of the Company’s outstanding ADSs and ordinary shares in open market transactions for a period not to exceed 24 months beginning on March 2, 2021. In August 2021, the Company announced that its board of directors had approved an amendment to such program to increase the total authorized repurchase amount to US$3.0 billion. As of January 9, 2023, this share repurchase program was completed with the Company having purchased an aggregate of approximately 33.6 million ADSs for nearly US$3.0 billion. On November 17, 2022, the Company announced that its board of directors had approved a new share repurchase program of up to US$5.0 billion of the Company’s ADSs and ordinary shares in open market transactions. This new share repurchase program commenced on January 10, 2023 and will be in effect for a period not to exceed 36 months from such date. As of December 31, 2023, the Company has repurchased approximately 7.2 million ADSs for approximately US$644.1 million under this program. In August 2021, the Company announced that its board of directors had approved a share purchase program of up to US$50.0 million of Youdao’s outstanding ADSs for a period not to exceed 36 months beginning on September 2, 2021. Under the terms of this program, NetEase may purchase Youdao’s ADSs in open-market transactions on the New York Stock Exchange. As of December 31, 2023, approximately 2.7 million ADSs had been purchased under this program for a total cost of US$22.0 million.

Related Party Transactions

Related Party Transactions	12 Months Ended
	Dec. 31, 2023
Related Party Transactions
Related Party Transactions	27. Related Party Transactions The Group had no material transactions with related parties for the year ended December 31, 2021, 2022 and 2023, and no material related parties’ balances as of December 31, 2022 and 2023.

Segment Information

Segment Information	12 Months Ended
	Dec. 31, 2023
Segment Information
Segment Information	28. Segment Information (a) Description of segments Operating segments are defined as components of an enterprise about which separate financial information is available that is evaluated regularly by the chief operating decision maker (“CODM”), or decision making group, in deciding how to allocate resources and in assessing performance. The Group’s CODM is the Chief Executive Officer. The Group’s organizational structure is based on a number of factors that the CODM uses to evaluate, view and run its business operations which include, but are not limited to, customer base, homogeneity of products and technology. The Group’s operating segments are based on this organizational structure and information reviewed by the Group’s CODM to evaluate the operating segment results. Effective in the fourth quarter of 2021, the Group changed its segment disclosure to separately report the results of Cloud Music. Effective in the second quarter of 2022, the Company renamed its “online game services” segment as “games and related value-added services,” and transferred certain business lines that are related or ancillary to its games from “innovative businesses and others” to “games and related value-added services,” including the NetEase CC live streaming service and other value-added services. As a result, the Group now reports segments as games and related value-added services, Youdao, Cloud Music and innovative businesses and others. This change in segment reporting aligns with the manner in which the Group’s CODM currently receives and uses financial information to allocate resources and evaluate the performance of reporting segments. This change in segment presentation does not affect consolidated balance sheets, consolidated statements of operations and comprehensive income or consolidated statements of cash flows. The Group retrospectively recast prior years segment information, to conform to current year presentation. (b) Segment data The table below provides a summary of the Group’s operating segment results for the years ended December 31, 2021, 2022 and 2023. The Group does not allocate any operating costs or assets to its business segments as the Group’s CODM does not use this information to measure the performance of the operating segments. There was no significant transaction between reportable segments for the years ended December 31, 2021, 2022 and 2023 (in thousands). ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the year ended December 31, ​ 2021 2022 2023 ​ ​ RMB ​ RMB ​ RMB Net revenues: ​ ​ ​ ​ ​ ​ Games and related value-added services 67,819,288 ​ 74,566,471 ​ 81,565,449 Youdao 5,354,357 ​ 5,013,182 ​ 5,389,208 Cloud Music ​ 6,997,622 ​ 8,992,221 ​ 7,866,992 Innovative businesses and others 7,434,759 ​ 7,923,935 ​ 8,646,510 Total net revenues 87,606,026 ​ 96,495,809 ​ 103,468,159 ​ ​ ​ ​ ​ ​ ​ Cost of revenues: ​ ​ ​ ​ ​ ​ Games and related value-added services (26,007,412) ​ (27,784,419) ​ (25,938,865) Youdao (2,448,146) ​ (2,430,738) ​ (2,621,746) Cloud Music ​ (6,854,948) ​ (7,699,103) ​ (5,764,322) Innovative businesses and others (5,324,719) ​ (5,815,423) ​ (6,079,832) Total cost of revenues (40,635,225) ​ (43,729,683) ​ (40,404,765) ​ ​ ​ ​ ​ ​ ​ Gross profit: ​ ​ ​ ​ ​ ​ Games and related value-added services 41,811,876 ​ 46,782,052 ​ 55,626,584 Youdao 2,906,211 ​ 2,582,444 ​ 2,767,462 Cloud Music ​ 142,674 ​ 1,293,118 ​ 2,102,670 Innovative businesses and others 2,110,040 ​ 2,108,512 ​ 2,566,678 Total gross profit 46,970,801 ​ 52,766,126 ​ 63,063,394 ​ The following table set forth the disaggregation of net revenues by timing of revenue recognition for the years ended December 31, 2021, 2022 and 2023 (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the year ended December 31, ​ 2021 2022 2023 ​ ​ RMB ​ RMB ​ RMB A point in time ​ 19,581,668 ​ 23,322,675 ​ 27,140,994 Over time ​ 68,024,358 ​ 73,173,134 ​ 76,327,165 Total Net revenue 87,606,026 96,495,809 103,468,159 ​ The following table presents the total depreciation expenses of property and equipment recorded under cost of revenues by segment for the years ended December 31, 2021, 2022 and 2023 (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the year ended December 31, ​ 2021 2022 2023 ​ ​ RMB ​ RMB ​ RMB Games and related value-added services 278,780 ​ 339,300 ​ 223,156 Youdao 9,330 ​ 11,610 ​ 9,275 Cloud Music ​ 3,827 ​ 6,044 ​ 2,452 Innovative businesses and others 114,442 ​ 129,693 ​ 60,126 Total depreciation expenses of property and equipment 406,379 ​ 486,647 ​ 295,009 ​ As substantially all of the Group’s long-lived assets are located in the PRC and substantially all of the Group’s revenue of reportable segments are derived from China based on the geographical locations where services and products are provided to customers, no geographical information is presented.

Financial Instruments

Financial Instruments	12 Months Ended
	Dec. 31, 2023
Financial Instruments
Financial Instruments	29. Financial Instruments The following table sets forth the financial instruments, measured at fair value, by level within the fair value hierarchy as of December 31, 2022 (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Fair Value Measurements ​ ​ (RMB) ​ ​ ​ ​ ​ ​ ​ Quoted Prices in ​ ​ ​ ​ ​ ​ ​ ​ Active Market ​ Significant Other ​ Significant ​ ​ ​ ​ for Identical ​ Observable ​ Unobservable ​ ​ ​ ​ Assets ​ Inputs ​ Inputs ​ Total (Level 1) (Level 2) (Level 3) Equity investments with readily determinable fair values ​ 2,567,268 ​ 2,567,268 ​ — ​ — Short-term investments 7,622,673 ​ — 7,622,673 ​ — Investments accounted for at fair values 246,073 ​ — ​ — ​ 246,073 Total ​ 10,436,014 ​ 2,567,268 7,622,673 ​ 246,073 ​ The following table sets forth the financial instruments, measured at fair value, by level within the fair value hierarchy as of December 31, 2023 (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Fair Value Measurements ​ ​ (RMB) ​ ​ ​ ​ ​ ​ Quoted Prices in ​ ​ ​ ​ ​ ​ ​ ​ Active Market ​ Significant Other ​ Significant ​ ​ ​ ​ for Identical ​ Observable ​ Unobservable ​ ​ ​ ​ Assets ​ Inputs ​ Inputs ​ Total (Level 1) (Level 2) ​ (Level 3) Equity investments with readily determinable fair values ​ 3,107,266 ​ 3,107,266 ​ — ​ — Short-term investments 4,436,057 ​ — 4,436,057 ​ — Investments accounted for at fair values ​ 490,781 ​ — ​ — ​ 490,781 Total 8,034,104 ​ 3,107,266 4,436,057 ​ 490,781 ​ The rates of interest under the loan agreements with the lending banks were determined based on the prevailing interest rates in the market. The Group classifies the valuation techniques that use these inputs as Level 2 of fair value measurements of short-term bank loans. For other financial assets and liabilities with carrying values that approximate fair value, if measured at fair value in the financial statements, these financial instruments would be classified as Level 3 in the fair value hierarchy. As of December 31, 2022 and 2023, certain equity investments without determinable fair value (Note 11) were measured using significant unobservable inputs (Level 3) and written down from their respective carrying value to fair value, with impairment charges of RMB85.2 million and RMB274.2 million incurred and recorded in earnings for the years then ended.

Restricted Net Assets

Restricted Net Assets	12 Months Ended
	Dec. 31, 2023
Restricted Net Assets
Restricted Net Assets	30. Restricted Net Assets Relevant PRC laws and regulations permit PRC companies to pay dividends only out of their retained earnings, if any, as determined in accordance with PRC accounting standards and regulations. Additionally, the Company’s PRC subsidiaries and the VIEs can only distribute dividends upon approval of the shareholders after they have met the PRC requirements for appropriation to the general reserve fund and the statutory surplus fund

Principal Accounting Policies (

Principal Accounting Policies (Policies)	12 Months Ended
	Dec. 31, 2023
Principal Accounting Policies
Basis of consolidation	(a) Basis of consolidation The consolidated financial statements include the financial statements of the Company, its subsidiaries and the VIEs for which the Company is the primary beneficiary with the ownership interests of minority shareholders reported as noncontrolling interests. All significant transactions and balances among the Company, its subsidiaries and the VIEs have been eliminated upon consolidation. The Company consolidates a VIE if the Company has the power to direct matters that most significantly impact the activities of the VIE, and has the obligation to absorb losses or the right to receive benefits of the VIE that could potentially be significant to the VIE.
Basis of presentation	(b) Basis of presentation The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“US GAAP”). The preparation of financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the balance sheet dates and the reported amounts of revenues and expenses during the reporting periods. Actual results might differ from those estimates. Critical accounting estimates and assumptions include, but are not limited to, assessing the following: revenues for in-game virtual items over the estimated average playing period of paying players and impairment of long-term investments.
Revenue recognition	(c) Revenue recognition Revenues from contracts with customers are recognized when control of the promised goods or services is transferred to the Group’s customers, in an amount that reflects the consideration the Group expects to be entitled to in exchange for those goods or services, reduced by estimates for return allowances, promotional discounts, rebates and Value Added Tax (“VAT”). The recognition of revenues involves certain management judgments, including estimated lives of virtual items purchased by game players, estimated breakage of game points, return allowance for goods sold, the estimation of the fair value of an advertising-for-advertising barter transaction, volume sales rebates. The amount and timing of the Group’s revenues could be different if management made different judgments or utilized different estimates. The Group’s revenues are mainly generated from online game services, tutoring services, sale of smart devices, online music services live streaming services, advertising services, e-commerce and other fee-based premium services. Refer to “Note 28 - Segment Information” for disaggregation of revenue. (i) Online game services The Group operates mobile games and PC games. The Group is the principal of substantially all games it operates, including both in-house developed games and licensed games. As these games are hosted on the Group’s servers, the Group has the pricing discretion, and is responsible for the sale and marketing of the games as well as customer services. Fees paid to game developers, app stores and payment platforms are recorded as cost of revenues. Mobile games The Group generates mobile game revenues from the sale of in-game virtual items, including items, avatars, skills, privileges or other in-game consumables, features or functionality, within the games. The Group’s performance obligation is to provide on-going game services to players who purchased virtual items to gain an enhanced game-playing experience. This performance obligation is satisfied over the playing period of the paying players. Accordingly, the Group recognizes the revenues ratably over the estimated average playing period of these paying players. The Group considers the average period that players typically play the games and other game player behavior patterns, as well as various other factors to arrive at the best estimates for the estimated average playing period of the paying players for each game based on historical players’ churn rates. If a new game is launched and only a limited period of paying player data is available, then the Group considers other qualitative factors. While the Group believes its estimates to be reasonable based on available game player information, the Group may revise such estimates based on new information indicating a change in the game player behavior patterns and any adjustments are applied prospectively. PC games The Group sells prepaid points to the end users. Customers can purchase “virtual” prepaid points online or from the vendors who register the points in the Group’s system via debit and credit cards or bank transfers via the online payment platforms, and receive the prepaid point information over the Internet. Customers can use the points to play the Group’s PC games, pay for in-game items and use other fee-based premium services. Proceeds received from the sales of prepaid online points to players are recorded as contract liabilities. The Group earns revenue through providing PC game services to players mainly under two types of revenue models: time-based revenue model and item-based revenue model. For PC games using the time-based model, players are charged based on the time they spend playing games. Revenues are recognized ratably over the game playing period as the performance obligations are satisfied. Under the item-based model, the basic game play functions are free of charge, and players are charged for purchases of in-game items. In-game items have different life patterns: one-time use, limited life and permanent life. Revenues from the sales of one-time use in-game items are recognized upon consumption. Limited life items are either limited by the times of uses (for example, 10 times) or limited by time (for example, three months). Revenues from the sales of limited life in-game items are recognized ratably based on the extent of time passed or expired or the times used. Players are allowed to use permanent life in-game items without any use or time limits. Revenues from the sales of permanent life in-game items are recognized ratably over the estimated average playing period of the paying players. The Group considers the average period that players typically play the games and other game player behavior patterns, as well as various other factors to arrive at the best estimates for the estimated average playing period of the paying players for the permanent in-game items of each PC game based on historical players’ churn rate. This estimate is re-assessed on a quarterly basis. Adjustments arising from the changes of estimated average playing period of the paying players are applied prospectively as such changes are resulted from new information indicating a change in the game player behavior patterns. (ii) Tutoring services The Group offers various types of integrated learning services through Youdao, which primarily cover a wide spectrum of topics and target people from broad age groups through its diverse offerings of tutoring courses and digital learning contents, foreign languages, professional and interest education services as well as IT computer skills, etc. Youdao’s tutoring courses consist of online live streaming and other activities during the online live streaming period, as well as the content playback service. The aforementioned services are highly interdependent and interrelated in the context of the contract and are only considered accessory services to the online live streaming courses and therefore are not distinct and are not sold standalone. Therefore, the Group’s tutoring courses are accounted for as a single performance obligation, which is satisfied over the learning period of the students. Accordingly, the Group recognizes the revenues ratably over the estimated average learning period for different courses. The Group considers the average period that students typically spend time on the courses and other learning behavior patterns to arrive at the best estimates for the estimated learning period for each course based on the estimated learning time customers spend on the courses and the expected number of times customers will take the courses. The Group also offers digital learning contents to customers which are delivered together with online live streaming courses and customized planning services. The customers can either stream the digital learning contents online or download and watch them offline. The downloadable digital learning contents, streaming services, online live streaming courses and customized planning services are considered as distinct performance obligations in the contract. The transaction price is generally collected in advance and allocated to each performance obligation in the contract based on the relative standalone selling prices. The Group recognizes the revenues of downloadable digital learning contents as the performance obligation is satisfied upon the time of delivery. The revenues of streaming services and customized planning services are recognized ratably over the service period. For online live streaming courses, the revenues are recognized ratably over the estimated average learning period. (iii) Smart devices The Group sells smart devices such as dictionary pen, smart learning pad and listening pod through Youdao to customers through retailers or distributors. The Group recognizes revenues when control of the goods is transferred to the customer, which generally occurs upon the delivery to the end customers or upon the delivery to distributors. (iv) Online music services The Group offers online music services through Cloud Music, which mainly include membership subscriptions, sales of digital music album and songs and contents sublicensing on the Group’s online platforms. The Group offers users membership subscription packages which entitled paying subscriber access to the Group’s relevant music contents and other privileged features on its platforms. The subscription fees for these packages are primarily time-based mainly from weekly to yearly and is collected upfront. The receipt of subscription fees is initially recognised as contract liabilities. The Group satisfies its performance obligations throughout the subscription period and revenue from the membership subscriptions is recognised over time. The Group also offers users to purchase exclusive digital music albums and songs which can listen both online and offline. The Group considers that the control has been transferred to customer at time of purchase. As a result, the performance obligation is satisfied and revenue is recognised at a point in time. The Group sublicenses certain of its music contents to other music platforms for a fixed period of one (v) Live streaming services The Group operates live streaming platforms through NetEase CC and Cloud Music whereby users can enjoy live performances provided by the live streaming performers and interact with them on a real time basis free of charge. The Group sells virtual items to users at pre-determined price so that the users gift them simultaneously to live streaming performers to show their support and appreciation. The virtual items sold by the Group comprise of either (i) consumable items or (ii) time-based item, such as privilege titles etc. Under the arrangements with the live streaming performers, the Group shares with them a portion of the revenues derived from the sales of virtual items. Revenues derived from the sale of virtual items are recorded on a gross basis as the Group acts as the principal to fulfill all obligations related to the sale of virtual items. Accordingly, revenue is recognized when the virtual item is delivered and consumed if the virtual item is a consumable item or, in the case of time-based virtual item, recognized ratably over the period each virtual item is made available to the user. (vi) Advertising services The Group derives its advertising revenues principally from short-term online advertising contracts. Advertising service contracts may consist of multiple performance obligations with a typical term of less than three months. In arrangements where the Group has multiple performance obligations, the transaction price is allocated to each performance obligation using the relative stand-alone selling price. The Group generally determines standalone selling prices based on the prices charged to customers. If the performance obligation has not been sold separately, the Group estimates the standalone selling price by taking into consideration of the pricing for advertising areas of the Group’s platform with a similar popularities and advertisements with similar formats and quoted prices from competitors as well as other market conditions. Considerations allocated to each performance obligation is recognized as revenue over the advertisement display period, which is usually within three months. The Group also enters into performance-based advertising arrangements with customers. For example, for cost per mille (“CPM”), or cost per thousand impressions, advertising arrangements with customers, the Group recognizes revenues based on the number of times that the advertisement has been displayed. Certain customers may receive volume rebates, which are accounted for as variable consideration. The Group estimates annual expected rebate volume with reference to their historical results and reduce revenues recognized. (vii) E-commerce The Group’s e-commerce revenue is primarily from its private label consumer lifestyle brand Yanxuan, which was established in April 2016. Yanxuan sells its private label products, including pet supplies, home cleaning products, bedding and other categories which mainly source directly from some excellent manufacturers. The Group is the principal for the online direct sales, as it controls the inventory before they are transferred to customers. The Group has the primary responsibility for fulfilling the contracts, bears the inventory risk, and has sole discretion in establishing the prices. E-commerce revenues from online direct sales are recognized when control of the goods is transferred to the customer, which generally occurs upon delivery to the customer. The Group also provides discount coupons to its customers for use in purchases, which are treated as a reduction of revenue when the related transaction is recognized. Return allowances, which reduce revenue and cost of sales, are estimated using historical experience. Liabilities for return allowances and rights to recover products from customers associated with the Group’s liabilities are recorded as “Accrued liabilities and other payables” and “Inventories”, respectively, on the Group’s consolidated balance sheets. Both of the balances are not material as of December 31, 2021, 2022 and 2023. (viii) Fee-based premium services Fee-based premium services revenues, mostly operated on either consumption-basis or a monthly subscription basis, are derived principally from providing premium online reading and other innovative businesses. Prepaid subscription fees collected from customers are deferred and are recognized as revenue on a straight-line basis by the Group over the subscription period, during which customers can access the premium online services provided by the Group. Fees collected from customer to be consumed to purchase online services are recognized as revenue when related services are rendered. Practical expedients The Group has used the following practical expedients as allowed under ASC 606: (i) The effects of a significant financing component have not been adjusted for contracts which the Group expects, at contract inception, that the period between when the Group transfers a promised good or service to the customer and when the customer pays for that good or service will be one year or less. (ii) The Group applied the portfolio approach in determining the commencement date of consumption of permanent virtual items and the estimated average playing period of paying players for PC games and mobile games for the recognition of online game revenue given that the effect of applying a portfolio approach to a group game players’ behaviors would not differ materially from considering each one of them individually. (iii) The Group elects to expense certain costs to obtain a contract as incurred when the expected amortization period is one year or less. Contract balances Timing of revenue recognition may differ from the timing of invoicing to customers. Accounts receivable represent amounts invoiced and revenue recognized prior to invoicing, when the Group has satisfied its performance obligations and has the unconditional right to payment. The Group’s right to consideration in exchange for goods or services that the Group has transferred to a customer is recognized as a contract asset. Contract assets as of December 31, 2022 and 2023 were not material. A contract liability is the Group’s obligation to transfer goods or services to a customer for which the Group has received consideration (or an amount of consideration is due) from the customer. Refer to Note 16 - Contract liabilities for further information, including changes in contract liabilities during the year.
Cost of revenues	(d) Cost of revenues Costs of revenues consist primarily of revenue sharing cost, staff-related costs, royalty fees related to licensed games, traffic acquisition cost, content acquisition cost, service fees related to online payments, server and bandwidth service fee, depreciation and amortization of severs, computers and software, and other direct costs of providing these services, as well as cost of merchandise sold. These costs are charged to the consolidated statements of operations and comprehensive income as incurred.
Research and development costs	(e) Research and development costs Research and development costs mainly consist of staff-related costs and technology service costs incurred for the development of online games, as well as development and enhancement of the Group’s new products, websites and application platforms. For internal use software, the Group expenses all costs incurred for the preliminary project stage and post implementation-operation stage of development, and costs associated with repair or maintenance of the existing platforms. Costs incurred in the application development stage are capitalized and amortized over the estimated useful life. Since the amount of the Group’s research and development expenses qualifying for capitalization has been immaterial for the years ended December 31, 2021, 2022 and 2023, as a result, all development costs incurred for development of internal used software have been expensed as incurred. For external use software, costs incurred for development of external use software have not been capitalized for the years ended December 31, 2021, 2022 and 2023, because the period after the date technical feasibility is reached and the time when the software is marketed is short historically, and the amount of costs qualifying for capitalization has been immaterial.
Cash, cash equivalents and time deposits	(f) Cash, cash equivalent s and time deposits Cash and cash equivalents mainly represent cash on hand, demand deposits placed with large reputable banks in Hong Kong and/or China, and highly liquid investments that are readily convertible to known amounts of cash and with original maturities from the date of purchase with terms of less than three months. As of December 31, 2022 and 2023, there were cash at bank and demand deposits with terms of less than three months denominated in U.S. dollars amounting to approximately US$623.8 million and US$1.6 billion, respectively (equivalent to approximately RMB4.3 billion and RMB11.1 billion, respectively). Time deposits represent time deposits placed with banks with original maturities of three months or more. As of December 31, 2022 and 2023, there were time deposits denominated in U.S. dollars amounting to approximately US$8.4 billion and US$8.6 billion, respectively (equivalent to approximately RMB58.6 billion and RMB61.2 billion, respectively). As of December 31, 2022 and 2023, the Group had approximately RMB48.1 billion and RMB48.5 billion cash and cash equivalents and time deposits held by its PRC subsidiaries and the VIEs, representing 42.6% and 39.3% of total cash and cash equivalents and time deposits of the Group, respectively. As of December 31, 2022 and 2023, the Group had a restricted cash balance approximately RMB2.7 billion and RMB2.8 billion, respectively, comprising as follows (in millions): ​ ​ ​ ​ ​ ​ ​ December 31, December 31, ​ ​ 2022 ​ 2023 ​ ​ RMB ​ RMB Customer deposit of NetEase Pay accounts 2,627.5 2,664.1 Others ​ 71.8 ​ 113.7 Total ​ 2,699.3 ​ 2,777.8 ​ The Group had no other material lien arrangements during 2022 and 2023.
Receivables, net	(g) Receivables, net The Group’s receivables are subject to the measurement of credit losses within the scope of ASC Topic 326. The impact of new standard was immaterial to the Company. The Group’s accounts receivable, other receivables recorded in prepayments and other current assets and other long-term receivables recorded in other long-term assets are within the scope of ASC Topic 326. Accounts receivable consist primarily of receivables from mobile games services, online music services and advertising services. To estimate expected credit losses, the Group has identified the relevant risk characteristics of its customers and the related receivables and other receivables which include size, type of the services or the products the Group provides, or a combination of these characteristics. Receivables with similar risk characteristics have been grouped into pools. For each pool, the Group considers the past collection experience, current economic conditions, future economic conditions (external data and macroeconomic factors) and changes in the Group’s customer collection trends. This is assessed at each quarter based on the Group’s specific facts and circumstances. The following table sets out the movements of the allowance for expected credit losses for the years ended December 31, 2021, 2022 and 2023 (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ For the year ended December 31, ​ 2021 2022 2023 ​ ​ RMB ​ RMB ​ RMB Balance at the beginning of year 113,253 369,982 403,360 Provisions 265,930 61,393 61,146 Write-offs (9,201) (28,015) (15,944) Balance at the end of year ​ 369,982 ​ 403,360 ​ 448,562 ​
Fair value of financial instruments	(h) Fair value of financial instruments Accounting guidance defines fair value as the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. When determining the fair value measurements for assets and liabilities required or permitted to be recorded at fair value, the Group considers the principal or most advantageous market in which it would transact and it considers assumptions that market participants would use when pricing the asset or liability. Accounting guidance establishes a fair value hierarchy that requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. A financial instrument’s categorization within the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement. Accounting guidance establishes three levels of inputs that may be used to measure fair value: Level 1 - Observable inputs that reflect quoted prices (unadjusted) for identical assets or liabilities in active markets Level 2 - Include other inputs that are directly or indirectly observable in the marketplace Level 3 - Unobservable inputs which are supported by little or no market activity The Group’s financial instruments include cash and cash equivalents and time deposits, restricted cash, accounts receivable, prepayments and other current assets, short-term investments, accounts payable, short-term loans and accrued liabilities and other payables, which the carrying values approximate their fair value. Please see Note 29 for additional information.
Inventories	(i) Inventories Inventories mainly represent products for the Group’s e-commerce business, are stated at the lower of cost or net realizable value in the consolidated balance sheets. Cost of inventory is determined using the weighted average cost method. Adjustments are recorded to write down the cost of inventory to the estimated net realizable value due to slow-moving merchandise and damaged goods, which is dependent upon factors such as historical and forecasted consumer demand, and promotional environment. The Group takes ownership, risks and rewards of the products purchased. Write downs are recorded in “Cost of revenues” in the consolidated statements of operations and comprehensive income. Certain costs attributable to buying and receiving products, such as purchase freights, are also included in inventories.
Investments	(j) I nvestments Short-term investments Short-term investments include investments in financial instruments with a variable interest rate indexed to performance of underlying assets, all of which are with an original maturity of less than 12 months. In accordance with ASC 825, for investments in financial instruments with a variable interest rate indexed to performance of underlying assets, the Group elected the fair value method at the date of initial recognition and carried these investments at fair value. Changes in the fair value are reflected in the consolidated statements of operations and comprehensive income as “Other income/(expense)”. Fair value is estimated based on quoted prices of similar products provided by banks at the end of each period. The Group classifies the valuation techniques that use these inputs as Level 2 of fair value measurements. Please see Note 7 and Note 29 for additional information. Long-term investments Long-term investments are mainly comprised of equity investments in publicly traded companies, privately-held companies and limited-partnership. Equity investments in publicly traded companies are reported at fair value as equity investment with readily determinable fair value. Unrealized gains and losses for the years ended December 31, 2021, 2022 and 2023 are recognized in other income/(expense). For investments in common stock or in-substance common stock issued by privately-held companies on which the Group does not have significant influence, and investments in privately-held companies’ shares that are not common stocks or in-substance common stocks, as these equity securities do not have readily determinable fair value, the Group measure these equity securities investments at cost, less impairment, if any, plus or minus changes resulting from observable price changes in orderly transactions for the identical or a similar investment of the same issuer (referred to as the measurement alternative). All gains and losses on these equity securities without readily determinable fair value, realized and unrealized, are recognized in other income /(expense). Investments in common stock or in-substance common stock of investees and limited-partnership investments in which the Group is in a position to exercise significant influence by participating in, but not controlling or jointly controlling, the financial and operating policies are accounted for using the equity method. Management regularly evaluates the impairment of the investments in privately-held companies without readily determinable fair value and equity method investments periodically, or when events or circumstances indicate that the carrying amount may not be recoverable. For investments without readily determinable fair values, management performs a qualitative assessment of the fair value of the equity interest in comparison to its carrying amount to determine if there is an indication of potential impairment. If such indication exists, management estimates the fair value of the investment, and records an impairment in the consolidated statements of operations and comprehensive income to the extent the carrying amount exceeds the fair value. Significant judgments management applies in the impairment assessment for these equity investments include: (i) the determination as to whether any impairment indicators exist during the year; (ii) estimating the impairment amount if an impairment exists; and (iii) judgments as to whether a decline in value of equity method investments was other than temporary. These judgments consider various factors and events including: a) significant deterioration in the earnings performance, credit rating, asset quality, or business prospects of the investees; b) significant adverse change in the regulatory, economic, or technological environment of the investees; c) significant adverse change in the general market condition of either the geographical area or the industry in which the investees operate; d) bona fide offer to purchase, an offer by the investee to sell, or a completed auction process for the same or similar investment for an amount less than the carrying amount of that investment; e) factors that raise significant concerns about the investees’ ability to continue as a going concern; f) factors that raise significant concerns about the performance of new products and g) valuation methods and key estimates in the determination of the impairment amounts. Key estimates mainly comprised the severity and duration of the impairment indicator and the existence of any positive or mitigating factors. For equity method investments, management considers if the investment is impaired when events or circumstances suggest the carrying amount may not be recoverable, and recognizes any impairment charge in the consolidated statements of operations and comprehensive income for a decline in value that is determined to be other than temporary.
Leases	(k) Leases The Group adopted ASU 2016-02, “Leases (Topic 842)”, including certain transitional guidance and subsequent amendments within ASU 2018-01, ASU 2018-10, ASU 2018-11, ASU 2018-20 and ASU 2019-01 (collectively, including ASU 2016-02, “ASC 842”). Leases that transfer substantially all of the benefits and risks incidental to the ownership of assets are accounted for as finance leases as if there was an acquisition of an asset and incurrence of an obligation at the inception of the lease. All other leases are accounted for as operating leases. As of December 31, 2022 and 2023, the Group has no material finance leases. Under ASC 842, the Group determines if an arrangement is a lease at inception. The Group is the lessee in a lease contract when the Group obtains the right to control the asset. Operating leases are included in operating lease right-of-use (“ROU”) assets, and short-term and long-term operating lease liabilities in the Group’s consolidated balance sheets. ROU assets represent the Group’s right to use an underlying asset for the lease term and lease liabilities represent the Group’s obligation to make lease payments arising from the lease. Operating lease ROU assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. As most of the Group’s leases do not provide an implicit rate, the Group generally uses its incremental borrowing rate based on the estimated rate of interest for collateralized borrowing over a similar term of the lease payments at commencement date. The operating lease ROU asset also includes any lease payments made and excludes lease incentives. Lease expense is recognized on a straight-line basis over the lease term. For leases with a term of twelve months or less (“short-term leases”), the Group has elected not to recognize lease liabilities and associated ROU assets. Lease payments on short-term leases are recognized as lease expense within cost of revenues or operating expenses on the consolidated statements of operations and comprehensive income, depending on the nature of the lease, on a straight-line basis over the lease term.
Property, equipment and software	(l) Property, equipment and software Property, equipment and software are stated at cost less accumulated depreciation. Depreciation is calculated on the straight-line basis over the following estimated useful lives, taking into account any estimated residual value: ​ ​ ​ ​ Building 20 years Decoration 5 years Leasehold improvements lesser of the term of the lease and the estimated useful lives of the assets Furniture, fixtures, office and other equipment 3-10 years Vehicles 5 years Servers and computers 3-5 years Software 3 years ​ Repairs and maintenance expenditures, which are not considered improvements and do not extend the useful life of the property and equipment, are expensed as incurred.
Land use rights	(m) Land use rights Land use rights represent lease prepayments to the local government authorities. Upon the adoption of ASC 842 on January 1, 2019, land use rights, net were identified as operating lease right-of-use assets, which is separately disclosed as “Land use rights, net” in the Group’s consolidated balance sheets. Accordingly, the Group disclosed the cash used for obtaining the land use rights in operating cash flow activities for the year ended December 31, 2021, 2022 and 2023.
Intangible assets	(n) Intangible assets Finite-lived intangible assets are tested for impairment if impairment indicators arise. The Group amortizes its finite-lived intangible assets using the straight-line method: ​ ​ ​ ​ License right over the license period Technology ​ 7-10 years Trademark 10 years ​ The Group obtains music content for customers through licensing agreements. When the license fee for music title is determinable or reasonably estimable, the content is available for streaming and the Group has a binding obligation for the payment, the Group recognizes an asset representing the fee and a corresponding liability for the amounts owed. The Group relieves the liability as payments are made and the Group amortizes the asset to “Cost of revenues” on a straight-line basis over the term of the respective licensing agreements. Intangible assets and other long-term assets are tested for recoverability whenever events or changes in circumstances indicate that its carrying amount may not be recoverable. When these events occur, the Group evaluates the impairment for intangible assets and other long-term assets by comparing the carrying amount of the assets to an estimate of future undiscounted cash flows expected to be generated from the use of the assets and their eventual disposition. If the sum of the expected future undiscounted cash flows is less than the carrying amount of the assets, the Group recognizes an impairment loss based on the excess of the carrying amount of the assets over the fair value of the assets.
Goodwill	(o) Goodwill Goodwill represents the excess of the purchase consideration over the fair value of the identifiable assets and liabilities acquired as a result of the Group’s acquisitions of interests in its subsidiaries and consolidated VIEs. The Group allocates goodwill to reporting units based on the reporting unit expected to benefit from the business combination. Goodwill is tested for impairment at the reporting unit level on an annual basis, or more frequently if events occur or circumstances change that indicate that it is more likely than not the fair value of a reporting unit would be below its carrying value. A goodwill impairment loss, if any, shall be measured as the amount by which the carrying amount of the reporting unit including goodwill exceeds its fair value, limited to the total carrying amount of goodwill allocated to that reporting unit. Application of the goodwill impairment test requires judgment, including the identification of reporting units, assignment of assets and liabilities to reporting units, assignment of goodwill to reporting units, and determination of the fair value of each reporting unit. The fair value of each reporting unit is estimated primarily through the use of a discounted cash flow methodology. This analysis requires significant judgments, including estimation of future cash flows, which is dependent on internal forecasts, estimation of the growth rate for business, estimation of the useful life over which cash flows will occur, and determination of weighted average cost of capital. Changes in these estimates and assumptions could materially affect the determination of fair value and goodwill impairment for each reporting unit.
Advertising and promotional expenses	(p) Advertising and promotional expenses The Group expenses advertising and promotional costs as incurred and reports these costs under selling and marketing expense. Advertising and promotional expenses totaled approximately RMB8.9 billion, RMB10.0 billion and RMB10.4 billion (US$1.5 billion) for the years ended December 31, 2021, 2022, and 2023, respectively.
Foreign currency translation	(q) Foreign currency translation The Group’s reporting currency is RMB. The Company and its subsidiaries and the VIEs, with an exception of many overseas subsidiaries, use RMB as their functional currency. Several of the Company’s overseas subsidiaries used US$ or their respective local currencies as their functional currency. The determination of the respective functional currency is based on the criteria of ASC 830, Foreign Currency Matters. Transactions in currencies other than the functional currency are measured and recorded in the functional currency using the exchange rate in effect at the date of the transaction. At the balance sheet date, monetary assets and liabilities that are denominated in currencies other than the functional currency are translated into the functional currency using the exchange rate at the balance sheet date. The resulting exchange differences are included in the consolidated statements of operations and comprehensive income. Assets and liabilities of the Group companies are translated from their respective functional currencies to the reporting currency at the exchange rates at the balance sheet dates, equity accounts are translated at historical exchange rates and revenues and expenses are translated at the average exchange rates in effect during the reporting period. The exchange differences for the translation of group companies with non-RMB functional currency into the RMB functional currency are included in foreign currency translation adjustments, which is a separate component of shareholders’ equity on the consolidated financial statements. Translations of amounts from RMB into United States dollars for the convenience of the reader were calculated at the noon buying rate of US$1.00 = RMB7.0999 on the last trading day of 2023 (December 29, 2023) as set forth in the H.10 statistical release of the U.S. Federal Reserve Board. No representation is made that the RMB amounts could have been, or could be, converted into United States dollars at such rate.
Share-based compensation	(r) Share-based compensation Under its 2009 Restricted Share Unit Plan and 2019 Restricted Share Unit Plan (see Note 22(a)), the Company issues restricted share units (RSUs) to its employees, directors and consultants with performance conditions and service vesting periods ranging from one year to five years. Some of the RSUs issued are to be settled, at the Company’s discretion, in stock or cash upon vesting based on the stock price at grant date. At each reporting period, the Company evaluates the likelihood of performance conditions being met. Share-based compensation costs are then recorded for the number of RSUs expected to vest on a graded-vesting basis, net of estimated forfeitures, over the requisite service period. The compensation cost of the RSUs to be settled in stock only is measured based on the fair value of stock when all conditions to establish the grant date have been met. The compensation cost of RSUs to be settled either in stock or cash at the Company’s discretion is remeasured until the date when settlement in stock or cash is determined by the Company. Effective February 22, 2023, the Board of Directors of the Company amended and restated the 2019 Restricted Share Unit Plan to permit the grant of stock option awards thereunder as an additional award type and to make certain other ministerial and administrative changes and renamed it the NetEase, Inc. Amended and Restated 2019 Share Incentive Plan (the “Amended and Restated 2019 Plan”). The Company records share-based compensation to the consolidated statements of operations and comprehensive income with the corresponding credit to the additional paid-in-capital for share options and RSUs to the extent that such awards are to be settled only in stock. Certain subsidiaries of the Company granted options exercisable for ordinary shares to certain of the Group’s employees. The options expire four Forfeitures were estimated based on the Group’s weighted average historical forfeiture rate of the past five years. Differences between actual and estimated forfeitures are expensed in the period that the differences occur. See Note 22 for further information regarding share-based compensation assumptions and expense.
Taxation	(s) Taxation Income tax expense is recognized in accordance with the laws of the relevant taxing authorities, with deferred taxes being provided for temporary differences between amounts of assets and liabilities for financial reporting purposes and such amounts as measured by tax laws. Tax rate changes are reflected in income during the period the changes are enacted. A deferred income tax asset or liability is computed for the expected future impact of differences between the financial reporting and tax bases of assets and liabilities as well as the expected future tax benefit to be derived from tax loss and tax credit carry forwards. On March 16, 2007, the National People’s Congress of PRC enacted the Enterprise Income Tax (“EIT”) Law which imposes a withholding income tax of 10% on dividends distributed by an enterprise in China to its non-resident enterprise investors. A lower withholding income tax rate of 5% is applied if the non-resident enterprise investor is registered in Hong Kong with at least 25% equity interest in the PRC enterprise and meets the relevant conditions or requirements pursuant to the tax arrangement between mainland China and Hong Kong. Valuation allowances are established, when necessary, to reduce deferred tax assets to the amount “more likely than not” to be realized in future tax returns. For a particular tax-paying component of an enterprise and within a particular tax jurisdiction, all deferred tax assets and liabilities are offset and presented as a single amount. The Group does not offset deferred tax assets and liabilities attributable to different tax-paying components of the enterprise or to different tax jurisdictions. The Group reports tax-related interest expense and penalty in “Other, net” in the consolidated statements of operations and comprehensive income, if there is any. The Group did not incur any material penalty or interest payments in connection with tax positions during the years ended December 31, 2021, 2022 and 2023. The Group did not have any significant unrecognized uncertain tax positions as of December 31, 2022 and 2023. In order to assess uncertain tax positions, the Group applies a more likely than not threshold and a two-step approach for the tax position measurement and financial statement recognition. Under the two-step approach, the first step is to evaluate the tax position for recognition by determining if the weight of available evidence indicates that it is more likely than not that the position will be sustained, including resolution of related appeals or litigation processes, if any. The second step is to measure the tax benefit as the largest amount that is more than 50% likely of being realized upon settlement.
Net earnings per share ("EPS") and per American Depositary Share ("ADS")	(t) Net earnings per share (“EPS”) and per American Depositary Share (“ADS”) Basic earnings per share is computed on the basis of the weighted-average number of ordinary shares outstanding during the period under measurement. Diluted earnings per share are based on the weighted-average number of ordinary shares outstanding and potential ordinary shares. Potential ordinary shares result from the assumed exercise of outstanding stock options, RSUs or other potentially dilutive equity instruments, when they are dilutive under the treasury stock method or the if-converted method.
Statutory reserves	(u) Statutory reserves The Company’s subsidiaries and the VIEs incorporated in China are required to make appropriations to certain non-distributable statutory reserves. In accordance with the laws applicable to foreign invested enterprises in China, its subsidiaries have to make appropriations from its after-tax profit as reported in their PRC statutory accounts to non-distributable statutory reserves including (i) general reserve fund, (ii) enterprise expansion fund and (iii) staff bonus and welfare fund. The appropriation to the general reserve fund is at least 10% of the after-tax profits as reported in the PRC statutory accounts. Appropriation is not required if the reserve fund has reached 50% of the registered capital of the respective company. The appropriation to the other reserve funds is at the discretion of the board of directors of the respective company. At the same time, the VIEs, in accordance with the China Company Laws, must make appropriations from their after-tax profit as reported in their PRC statutory accounts to non-distributable statutory reserves including (i) statutory surplus fund and (ii) discretionary surplus fund. The appropriation to the statutory surplus fund is at least 10% of the after-tax profits as reported in their PRC statutory accounts. Appropriation is not required if the statutory surplus fund has reached 50% of the registered capital of the respective company. Appropriation to the discretionary surplus fund is made at the discretion of the board of directors of the respective companies. The general reserve fund and statutory surplus fund are restricted to set off against losses, expansion of production and operation or increase in the registered capital of the respective companies. The staff bonus and welfare fund is available to fund payments of special bonuses to staff and for collective welfare benefits. Upon approval by the board of directors, the discretionary surplus and enterprise expansion fund can be used to offset accumulated losses or to increase capital.
Business combination	(v) Business combination The Group accounts for its business combinations using the acquisition method of accounting in accordance with ASC 805, Business Combinations. The cost of an acquisition is measured as the aggregate of the acquisition date fair values of the assets transferred and liabilities assumed by the Group to the sellers and equity instruments issued. Transaction costs directly attributable to the acquisition are expensed as incurred. Identifiable assets and liabilities acquired or assumed are measured separately at their fair values as of the acquisition date, irrespective of the extent of any noncontrolling interests. The excess of (i) the total costs of acquisition, fair value of the noncontrolling interests and acquisition date fair value of any previously held equity interest in the acquiree over (ii) the fair value of the identifiable net assets of the acquiree is recorded as goodwill. If the cost of acquisition is less than the fair value of the net assets of the subsidiary acquired, the difference is recognized directly in the consolidated statements of operations and comprehensive income. During the measurement period, which can be up to one year from the acquisition date, the Group may record adjustments to the assets acquired and liabilities assumed with the corresponding offset to goodwill. Upon the conclusion of the measurement period or final determination of the values of assets acquired or liabilities assumed, whichever comes first, any subsequent adjustments are recorded on the consolidated statements of operations and comprehensive income. In a business combination achieved in stages, the Group re-measures the previously held equity interests in the acquiree when obtaining control at its acquisition date fair value and the re-measurement gain or loss, if any, is recognized on the consolidated statements of operations and comprehensive income. When there is a change in ownership interests or a change in contractual arrangements that results in a loss of control of a subsidiary, the Company deconsolidates the subsidiary from the date control is lost. Any retained noncontrolling investment in the former subsidiary is measured at fair value and is included in the calculation of the gain or loss upon deconsolidation of the subsidiary.
Noncontrolling interests and redeemable noncontrolling interests	(w) Noncontrolling interests and redeemable noncontrolling interests Noncontrolling interests are recognized to reflect the portion of the equity of majority-owned subsidiaries and the VIEs which is not attributable, directly or indirectly, to the controlling shareholder. The noncontrolling interest will continue to be attributed its share of losses even if that attribution results in a deficit noncontrolling interest balance. Redeemable noncontrolling interests represent redeemable equity interests issued by the Group’s subsidiaries to certain investors (see Note 19), and have been classified as mezzanine classified noncontrolling interests in the consolidated financial statements as these redeemable interests are contingently redeemable upon the occurrence of certain conditional events, which is not solely within the control of the Group. The Group accreted the redeemable equity interests to their redemption value, which is purchase price plus interest per year over the period since issuance to the earliest redemption date. The accretions were recorded against retained earnings, or in the absence of retained earnings, by charges against additional paid-in capital. Once additional paid-in capital had been exhausted, additional charges were recorded by increasing the accumulated deficit.
Related parties	(x) Related parties Parties are considered to be related if one party has the ability, directly or indirectly, to control the other party or exercise significant influence over the other party in making financial and operating decisions. Parties are also considered to be related if they are subject to common control or significant influence, such as a family member or relative, stockholder, or a related corporation.
Comprehensive income	(y) Comprehensive income Comprehensive income is defined as the change in equity of the Group during a period arising from transactions and other events and circumstances excluding transactions resulting from investments by shareholders and distributions to shareholders.
Segment reporting	(z) Segment reporting The Group’s internal organizational structure as well as information about geographical areas, business segments and major customers in financial statements is set out in detail under Note 28.
Dividends	(aa) Dividends Dividends of the Company are recognized when declared.
Recently issued accounting pronouncements not yet adopted	( bb ) Recently issued accounting pronouncements not yet adopted In November 2023, the FASB issued ASU 2023-07, Segment Reporting(Topic 280): Improvements to Reportable Segment Disclosure. ASU 2023-07 improves reportable segment disclosure requirements on an annual and interim basis for all public entities to enable investors to develop more decision-useful financial analyses, primarily through enhanced disclosures about significant segment expenses. The amendments in this Update are effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024. Early adoption is permitted.A public entity should apply the amendments in this Update retrospectively to all prior periods presented in the financial statements. Upon transition, the segment expense categories and amounts disclosed in the prior periods should be based on the significant segment expense categories identified and disclosed in the period of adoption.The Group is currently evaluating the impact of the accounting standard updates on the consolidated financial statements. In December 2023, the FASB issued ASU No. 2023-09, Income Taxes (Topic 740):Improvements to Income Tax Disclosures. ASU No. 2023-09 requires disaggregated information about a reporting entity’s effective tax rate reconciliation as well as additional information on income taxes paid. The guidance is effective for annual periods beginning after December 15, 2024 on a prospective basis. Early adoption is permitted. The Group is currently evaluating the impact of the accounting standard updates on the consolidated financial statements.

Organization and Nature of Op_2

Organization and Nature of Operations (Tables)	12 Months Ended
	Dec. 31, 2023
Organization and Nature of Operations
Schedule of major subsidiaries and VIEs	The major subsidiaries and the VIEs through which the Company conducts its business operations as of December 31, 2023 are described below: ​ ​ ​ ​ ​ Place and year of Major Subsidiaries ​ Incorporation Guangzhou Boguan Telecommunication Technology Co., Ltd. (“Boguan”) Guangzhou, China 2003 NetEase (Hangzhou) Network Co., Ltd. (“NetEase Hangzhou”) Hangzhou, China 2006 Hong Kong NetEase Interactive Entertainment Limited ​ Hong Kong, China 2007 ​ ​ ​ ​ ​ Place and year of Major VIEs and VIEs’ subsidiaries ​ Incorporation Guangzhou NetEase Computer System Co., Ltd. (“Guangzhou NetEase”) Guangzhou, China 1997 Hangzhou NetEase Leihuo Technology Co., Ltd. (“Hangzhou Leihuo”, formerly known as Hangzhou NetEase Leihuo Network Co., Ltd.) Hangzhou, China 2009
Schedule of combined financial information of the VIEs included in the accompanying consolidated financial statements of the Group	The following combined financial information of the VIEs was included in the accompanying consolidated financial statements of the Group as follows (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ December 31, ​ December 31, ​ 2022 2023 ​ ​ RMB ​ RMB Cash and cash equivalents ​ 2,303,280 ​ 1,802,256 Time deposits ​ 400,000 ​ 420,000 Restricted cash ​ 2,654,971 ​ 2,701,083 Accounts receivable, net ​ 3,542,272 ​ 4,663,331 Inventories ​ 67,572 ​ 36,908 Prepayments and other current assets, net ​ 1,867,110 ​ 1,765,209 Short-term investments ​ 73,984 ​ 73,904 Amounts due from Group companies ​ 9,917,091 ​ 9,192,463 Total current assets ​ 20,826,280 ​ 20,655,154 ​ ​ ​ ​ ​ Property, equipment and software, net ​ 78,666 ​ 52,212 Operating lease right-of-use assets, net ​ 54,653 ​ 53,686 Deferred tax assets ​ 155,595 ​ 148,847 Restricted cash ​ 200 ​ 500 Long-term investments ​ 885,372 ​ 1,212,804 Other long-term assets ​ 164,968 ​ 203,744 Total non-current assets ​ 1,339,454 ​ 1,671,793 ​ ​ ​ ​ ​ Total assets 22,165,734 22,326,947 ​ ​ ​ ​ ​ Accounts payable ​ 802,717 ​ 265,137 Salary and welfare payables ​ 155,478 ​ 114,794 Taxes payable ​ 41,352 ​ 142,769 Short-term loans ​ 422 ​ 16,095 Contract liabilities ​ 11,465,101 ​ 12,401,426 Accrued liabilities and other payables ​ 3,809,049 ​ 3,689,885 Short-term operating lease liabilities ​ 20,690 ​ 22,413 Amounts due to Group companies ​ 3,937,784 ​ 2,822,751 Total current liabilities ​ 20,232,593 ​ 19,475,270 ​ ​ ​ ​ ​ Long-term operating lease liabilities ​ 34,291 ​ 30,278 Other long-term payable ​ 263,373 ​ 554,648 Total non-current liabilities ​ 297,664 ​ 584,926 ​ ​ ​ ​ ​ Total liabilities 20,530,257 20,060,196 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the year ended December 31, ​ 2021 2022 2023 ​ ​ RMB ​ RMB ​ RMB Net revenues ​ ​ ​ Third-party revenues ​ 74,406,521 ​ 82,549,444 ​ 90,054,544 Intra-Group revenues ​ 808,648 ​ 817,962 ​ 734,857 Total net revenues ​ 75,215,169 ​ 83,367,406 ​ 90,789,401 ​ ​ ​ ​ ​ ​ ​ Cost of revenues and operating expenses ​ ​ ​ ​ ​ ​ Third-party cost of revenues and operating expenses ​ (17,651,675) ​ (18,358,287) ​ (17,468,565) Intra-Group cost of revenues and operating expenses related to technical consulting and related service ​ (56,822,482) ​ (64,777,586) ​ (72,992,568) Other intra-Group cost of revenues and operating expenses ​ (168,850) ​ (185,608) ​ (23,546) Total cost of revenues and operating expenses ​ (74,643,007) ​ (83,321,481) ​ (90,484,679) ​ ​ ​ ​ ​ ​ ​ Net income 624,299 (81,329) 328,357 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the year ended December 31, ​ 2021 2022 2023 ​ ​ RMB ​ RMB ​ RMB Cash flows from operating activities: ​ ​ ​ ​ ​ ​ Net cash provided by transactions with third-parties ​ 61,272,031 ​ 67,459,864 ​ 72,325,460 Net cash used in transactions with intra-Group companies related to technical consulting and related service ​ (59,439,552) ​ (66,970,818) ​ (73,298,667) Net cash (used in)/ provided by other transactions with intra-Group companies ​ (283,621) ​ 299,452 ​ 639,545 Net cash provided by/ (used in) operating activities 1,548,858 788,498 (333,662) ​ ​ ​ ​ ​ ​ ​ Cash flows from investing activities: ​ ​ ​ ​ ​ ​ Net cash used in transactions with third-parties ​ (39,430) ​ (71,832) ​ (82,645) Net cash used in investing activities (39,430) (71,832) (82,645) ​ ​ ​ ​ ​ ​ ​ Cash flows from financing activities: ​ ​ ​ ​ ​ ​ Net cash used in transactions with intra-Group companies ​ (622,809) ​ (105,448) ​ (52,839) Net cash (used in)/ provided by transactions with third-parties ​ (678,287) ​ (52,541) ​ 15,673 Net cash used in financing activities (1,301,096) (157,989) (37,166) ​

Principal Accounting Policies_2

Principal Accounting Policies (Tables)	12 Months Ended
	Dec. 31, 2023
Principal Accounting Policies
Schedule of restricted cash balance	As of December 31, 2022 and 2023, the Group had a restricted cash balance approximately RMB2.7 billion and RMB2.8 billion, respectively, comprising as follows (in millions): ​ ​ ​ ​ ​ ​ ​ December 31, December 31, ​ ​ 2022 ​ 2023 ​ ​ RMB ​ RMB Customer deposit of NetEase Pay accounts 2,627.5 2,664.1 Others ​ 71.8 ​ 113.7 Total ​ 2,699.3 ​ 2,777.8 ​
Schedule of movements of the allowance for expected credit losses	The following table sets out the movements of the allowance for expected credit losses for the years ended December 31, 2021, 2022 and 2023 (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ For the year ended December 31, ​ 2021 2022 2023 ​ ​ RMB ​ RMB ​ RMB Balance at the beginning of year 113,253 369,982 403,360 Provisions 265,930 61,393 61,146 Write-offs (9,201) (28,015) (15,944) Balance at the end of year ​ 369,982 ​ 403,360 ​ 448,562
Schedule of property, equipment and software useful lives	​ ​ ​ ​ Building 20 years Decoration 5 years Leasehold improvements lesser of the term of the lease and the estimated useful lives of the assets Furniture, fixtures, office and other equipment 3-10 years Vehicles 5 years Servers and computers 3-5 years Software 3 years
Schedule of intangible assets and its estimated useful life	​ ​ ​ ​ License right over the license period Technology ​ 7-10 years Trademark 10 years ​

Acquisition (Tables)

Acquisition (Tables)	12 Months Ended
	Dec. 31, 2023
Acquisition
Schedule of consideration allocation on the acquisition date based on fair value of the assets acquired and the liabilities assumed	The acquired entities individually and in aggregate were insignificant. The Group’s acquisitions in 2022 are summarized in the following table (in thousands): ​ ​ ​ ​ ​ ​ Amounts ​ RMB Net liabilities acquired (34,671) Amortizable intangible assets (i) Trademark 143,146 Other identified intangible assets 525,853 Deferred tax liabilities (104,137) Goodwill 1,571,206 Noncontrolling interests (122,983) Total 1,978,414 (i) Trademarks and other identified intangible assets acquired in the acquisitions are included in “Copyrights, licenses, domain names, trademark and technology”.

Concentrations and Risks (Table

Concentrations and Risks (Tables)	12 Months Ended
	Dec. 31, 2023
Service providers | Server and bandwidth service provider
Concentrations and Risks
Schedule of concentration risk by risk factor	​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the year ended December 31, ​ ​ 2021 2022 2023 ​ Number of service providers, offering 10% or more of the Group’s server and bandwidth service expenditure 4 ​ 4 ​ 4 ​ Total% of the Group’s server and bandwidth service expenditure provided by 10% or greater service providers 67.2 % 62.7 % 59.4 % ​
Accounts receivable | Credit risk
Concentrations and Risks
Schedule of concentration risk by risk factor	​ ​ ​ ​ ​ ​ ​ ​ December 31, December 31, ​ 2022 2023 Channel A 17.8 % 23.5 % ​

Prepayments and Other Current_2

Prepayments and Other Current Assets (Tables)	12 Months Ended
	Dec. 31, 2023
Prepayments and Other Current Assets
Summary of prepayments and other current assets	The following is a summary of prepayments and other current assets (in thousands): ​ ​ ​ ​ ​ ​ ​ December 31, December 31, ​ ​ 2022 ​ 2023 ​ ​ RMB ​ RMB Guarantee payment made to Blizzard - royalty fees 634,909 — Prepayment for royalties, revenue sharing cost 1,787,638 1,729,241 Interest receivable 1,373,854 2,271,944 Prepayments of content and marketing cost and other operational expenses 725,183 638,697 Prepayment for deductible value added tax and refundable subsidy 492,552 581,228 Bridge loans in connection with ongoing investments 43,313 27,369 Deposits 68,285 81,712 Employee advances ​ 61,480 ​ 57,949 Advance to suppliers ​ 105,903 ​ 43,820 Receivable within one - year related to disposal of investments ​ — ​ 512,367 Others 155,167 132,268 ​ 5,448,284 6,076,595 ​

Short-term Investments (Tables)

Short-term Investments (Tables)	12 Months Ended
	Dec. 31, 2023
Short-term Investments
Summary of short-term investments	The following is a summary of short-term investments (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ December 31, 2022 ​ ​ Unrealized Estimated ​ ​ Cost ​ Gains ​ Fair Value ​ ​ RMB ​ RMB ​ RMB Short-term investments 7,563,805 ​ 58,868 ​ 7,622,673 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ December 31, 2023 ​ ​ Unrealized Estimated ​ ​ Cost ​ Gains ​ Fair Value ​ ​ RMB ​ RMB ​ RMB Short-term investments ​ 4,275,329 ​ 160,728 ​ 4,436,057 ​

Property, Equipment and Softw_2

Property, Equipment and Software, net (Tables)	12 Months Ended
	Dec. 31, 2023
Property, Equipment and Software, net
Summary of property, equipment and software	The following is a summary of property, equipment and software (in thousands): ​ ​ ​ ​ ​ ​ ​ December 31, December 31, ​ ​ 2022 ​ 2023 ​ ​ RMB ​ RMB Building and decoration 3,875,063 4,063,468 Leasehold improvements 304,365 311,156 Furniture, fixtures, office and other equipment 379,938 508,185 Vehicles 102,823 106,027 Servers and computers 6,018,709 6,144,176 Software 344,410 367,472 Construction in progress 1,587,413 3,675,879 ​ 12,612,721 15,176,363 ​ ​ ​ ​ ​ Less: accumulated depreciation (6,270,391) (6,923,618) Less: impairment ​ — ​ (177,701) Net book value 6,342,330 8,075,044 ​

Land Use Rights, net (Tables)

Land Use Rights, net (Tables)	12 Months Ended
	Dec. 31, 2023
Land use rights
Land Use Rights, net
Summary of land use rights	The land use rights are summarized as follows (in thousands): ​ ​ ​ ​ ​ ​ ​ December 31, December 31, ​ ​ 2022 ​ 2023 ​ ​ RMB ​ RMB Cost 4,521,308 4,590,902 Incentive payment from local government (15,000) (15,000) Accumulated amortization (384,541) (486,475) Impairment ​ — ​ (14,284) Land use right, net 4,121,767 4,075,143

Leases (Tables)

Leases (Tables)	12 Months Ended
	Dec. 31, 2023
Leases
Schedule of information related to operating leases	The following table provides information related to the Group’s operating leases (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ For the year ended December 31, ​ 2021 2022 2023 ​ ​ RMB ​ RMB ​ RMB Operating lease cost 461,542 ​ 409,196 ​ 344,606 Cash paid for amounts included in the measurement of operating lease liabilities 503,127 ​ 471,214 ​ 331,579 Right-of-use assets obtained in exchange for operating lease obligations 763,919 ​ 336,381 ​ 215,209
Schedule of information related to operating lease terms and discount rates, which excludes the land use rights	​ ​ ​ ​ ​ ​ ​ ​ December 31, December 31, ​ ​ 2022 ​ 2023 Weighted average remaining lease term 3.22 years 2.92 years ​ Weighted average discount rate 3.82 % 3.77 %
Schedule of maturities of operating lease liabilities	Maturities of operating lease liabilities as of December 31, 2023 were as follows (in thousands): ​ ​ ​ ​ ​ RMB 2024 284,976 2025 193,875 2026 132,049 2027 85,279 2028 ​ 83,947 Thereafter 106,998 Total operating lease payments 887,124 Less: imputed interest (71,802) Total 815,322 ​

Long-term Investments (Tables)

Long-term Investments (Tables)	12 Months Ended
	Dec. 31, 2023
Long-term Investments
Schedule of long-term investments	The following is a summary of long-term investments (in thousands): ​ ​ ​ ​ ​ ​ ​ December 31, December 31, ​ ​ 2022 ​ 2023 ​ ​ RMB ​ RMB Investments in equity method investees 5,239,242 6,109,240 Equity investments with readily determinable fair values ​ 2,567,268 ​ 3,107,266 Equity investments without readily determinable fair values 10,463,304 12,021,518 Investments accounted for at fair values ​ 246,073 ​ 490,781 Debt investments ​ 28,471 ​ 54,382 ​ 18,544,358 21,783,187 ​

Other Long-term Assets (Tables)

Other Long-term Assets (Tables)	12 Months Ended
	Dec. 31, 2023
Other Long-term Assets
Summary of other long-term assets	The following is a summary of other long-term assets (in thousands): ​ ​ ​ ​ ​ ​ ​ December 31, December 31, ​ ​ 2022 ​ 2023 ​ ​ RMB ​ RMB Copyrights, licenses, domain names, trademark and technology 2,117,688 1,884,603 Goodwill ​ 2,166,486 ​ 1,855,394 Long-term receivable ​ 1,638,572 ​ 1,500,100 Non-current deposits ​ 174,357 ​ 179,399 Long-term interest receivables ​ 100,397 ​ 38,174 Staff housing loans 39,228 34,690 Others 569,727 446,746 ​ 6,806,455 5,939,106 ​
Schedule of goodwill	​ ​ ​ ​ ​ ​ ​ ​ December 31, ​ December 31, ​ 2022 2023 ​ ​ RMB ​ RMB Beginning balance 595,280 2,166,486 Additions 1,571,206 — Disposal ​ — ​ (311,092) Ending balance 2,166,486 1,855,394

Taxation (Tables)

Taxation (Tables)	12 Months Ended
	Dec. 31, 2023
Taxation
Schedule of the combined effects of EIT exemptions and tax rate reductions	The following table presents the combined effects of EIT exemptions and tax rate reductions enjoyed by the Group for the years ended December 31, 2021, 2022 and 2023 (in thousands except per share data): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the year ended December 31, ​ 2021 2022 2023 ​ ​ RMB ​ RMB ​ RMB Aggregate amount of EIT exemptions and tax rate reductions 2,238,907 2,631,764 3,228,359 Earnings per share effect, basic 0.67 0.81 1.00 Earnings per share effect, diluted 0.66 0.80 0.99 ​
Schedule of component of income tax expenses	The following table sets forth the component of income tax expenses of the Group for the years ended December 31, 2021, 2022 and 2023 (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the year ended December 31, ​ 2021 2022 2023 ​ ​ RMB ​ RMB ​ RMB Current tax expense 3,720,321 4,542,168 4,568,267 Deferred tax expense 407,948 489,670 131,437 Income tax expenses 4,128,269 5,031,838 4,699,704
Schedule of reconciliation of the differences between the statutory income tax rate and the Group's effective income tax rate	​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the year ended December 31, ​ 2021 2022 2023 ​ ​ % ​ % ​ % Statutory income tax rate 25.0 25.0 25.0 Permanent differences (2.7) (5.0) (7.1) Effect due to different tax rates applicable to overseas entities (1.8) 0.2 0.2 Effect of lower tax rate applicable to HNTEs (10.1) (10.1) (9.5) Change in valuation allowance 3.9 1.8 0.6 Effect of withholding income tax (d) 5.3 8.8 4.6 Effective income tax rate 19.6 20.7 13.8 ​
Schedule of tax impact of significant temporary differences that give rise to the deferred tax assets and liabilities	The following table presents the tax impact of significant temporary differences that give rise to the deferred tax assets and liabilities as of December 31, 2022 and 2023 (in thousands): ​ ​ ​ ​ ​ ​ ​ December 31, December 31, ​ ​ 2022 ​ 2023 ​ ​ RMB ​ RMB Deferred tax assets: ​ ​ ​ ​ Contract liabilities, primarily for advanced payments from online games customers 1,009,624 1,043,715 Accruals 654,348 808,527 Depreciation and amortization 7,100 2,180 Net operating tax loss carry forward 3,781,233 3,424,344 ​ 5,452,305 5,278,766 Less: valuation allowance (3,971,516) (3,718,678) Total 1,480,789 1,560,088 ​ ​ ​ ​ ​ ​ ​ December 31, December 31, ​ ​ 2022 ​ 2023 ​ ​ RMB ​ RMB Deferred tax liabilities: ​ ​ ​ ​ Withholding income tax (d) 1,947,190 2,165,573 Others 178,930 133,730 Total 2,126,120 2,299,303
Schedule of movement of the aggregate valuation allowances for deferred tax assets	The following table sets forth the movement of the aggregate valuation allowances for deferred tax assets for the periods presented (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ Balance at Net change Balance at ​ ​ January 1 ​ for the year ​ December 31 ​ ​ RMB ​ RMB ​ RMB 2021 3,255,854 ​ 393,016 ​ 3,648,870 2022 3,648,870 ​ 322,646 ​ 3,971,516 2023 3,971,516 ​ (252,838) ​ 3,718,678

Taxes Payable (Tables)

Taxes Payable (Tables)	12 Months Ended
	Dec. 31, 2023
Taxes Payable
Summary of taxes payable	The following is a summary of taxes payable as of December 31, 2022 and 2023 (in thousands): ​ ​ ​ ​ ​ ​ ​ December 31, December 31, ​ ​ 2022 ​ 2023 ​ ​ RMB ​ RMB Sales Tax payable 290,272 277,201 Withholding individual income taxes for employees 306,861 378,103 EIT payable 2,116,014 1,790,393 Others 99,949 125,837 ​ 2,813,096 2,571,534 ​

Accrued Liabilities and Other_2

Accrued Liabilities and Other Payables (Tables)	12 Months Ended
	Dec. 31, 2023
Accrued Liabilities and Other Payables
Summary of accrued liabilities and other payables	The following is a summary of accrued liabilities and other payables as of December 31, 2022 and 2023 (in thousands): ​ ​ ​ ​ ​ ​ ​ December 31, December 31, ​ ​ 2022 ​ 2023 ​ ​ RMB ​ RMB Customer deposits on NetEase Pay accounts 3,113,107 3,268,237 Marketing expenses and promotion materials 2,046,559 3,063,280 Content cost ​ 1,703,218 ​ 1,432,706 Accrued fixed assets related payables 635,566 1,027,401 Accrued revenue sharing 1,032,559 969,903 Professional fees and technical charges 595,491 789,955 Administrative expenses and other staff related cost ​ 414,214 ​ 448,926 Deferred government grants ​ 179,961 ​ 356,239 Acquisition considerations ​ 203,584 ​ 204,229 Server and bandwidth service fees ​ 246,243 ​ 196,202 Customer refund for licensed games ​ 283,763 ​ 97,301 Accrued freight and warehousing charge ​ 105,356 ​ 83,902 Others 562,401 732,625 ​ 11,122,022 12,670,906 ​

Employee Benefits (Tables)

Employee Benefits (Tables)	12 Months Ended
	Dec. 31, 2023
Employee Benefits
Schedule of group's employee welfare benefits expense	The following table presents the Group’s employee welfare benefits expense, which is mainly related to its Chinese subsidiaries and the VIEs, for the years ended December 31, 2021, 2022 and 2023 (in millions): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the year ended December 31, ​ 2021 2022 2023 ​ ​ RMB ​ RMB ​ RMB Contributions to medical and pension schemes 1,463.8 1,710.4 1,786.5 Other employee benefits 1,044.5 1,202.8 1,398.1 ​ 2,508.3 2,913.2 3,184.6 ​

Share-based Compensation (Table

Share-based Compensation (Tables)	12 Months Ended
	Dec. 31, 2023
Share based Compensation
Summary of the group's share-based compensation cost	The table below presents a summary of the Group’s share-based compensation cost (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the year ended December 31, ​ 2021 2022 2023 ​ ​ RMB ​ RMB ​ RMB Cost of revenues 833,389 758,413 823,765 Selling and marketing expenses 118,611 120,171 132,801 General and administrative expenses 1,105,547 1,214,995 1,119,018 Research and development expenses 983,945 1,080,581 1,167,226 ​ 3,041,492 3,174,160 3,242,810
Restricted share units
Share based Compensation
Summary of the company's RSUs award activities	​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Weighted average ​ ​ ​ ​ ​ grant date fair ​ ​ Number of RSUs value ​ ​ ​ (in thousands) ​ US$ ​ Outstanding at January 1, 2021 14,096 57.85 Granted 4,579 110.19 Vested (5,067) 58.02 Forfeited (612) 75.29 Outstanding at December 31, 2021 12,996 75.40 ​ ​ ​ ​ ​ ​ Outstanding at January 1, 2022 12,996 75.40 Granted 5,335 93.98 Vested (4,630) 75.01 Forfeited (696) 84.55 Outstanding at December 31, 2022 13,005 82.67 ​ ​ ​ ​ ​ ​ Outstanding at January 1, 2023 13,005 82.67 Granted 4,795 84.73 Vested (5,190) 76.27 Forfeited (523) 88.24 Outstanding at December 31, 2023 12,087 86.00

Net Income Per Share (Tables)

Net Income Per Share (Tables)	12 Months Ended
	Dec. 31, 2023
Net Income Per Share
Schedule of computation of basic and diluted net income per share	​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the year ended December 31, ​ 2021 2022 2023 Numerator (RMB in thousands): ​ ​ ​ ​ ​ ​ Net income from continuing operations attributable to the Company’s shareholders ​ 16,856,842 ​ 19,712,736 ​ 29,416,552 Net income from discontinued operations attributable to the Company’s shareholders ​ — ​ 624,864 ​ — Net income attributable to the Company’s shareholders for basic/dilutive net income per share calculation 16,856,842 20,337,600 29,416,552 ​ ​ ​ ​ ​ ​ ​ Denominator (No. of shares in thousands): ​ ​ ​ ​ ​ ​ Weighted average number of ordinary shares outstanding, basic 3,325,864 3,263,455 3,216,475 Dilutive effect of restricted share units ​ 41,614 ​ 32,559 ​ 35,554 Weighted average number of ordinary shares outstanding, diluted ​ 3,367,478 ​ 3,296,014 ​ 3,252,029 Net income per share from continuing operations attributable to the Company’s shareholders, basic (RMB) ​ 5.07 ​ 6.04 ​ 9.15 Net income per share from discontinued operations attributable to the Company’s shareholders, basic (RMB) ​ — ​ 0.19 ​ — Net income per share, basic (RMB) 5.07 6.23 9.15 Net income per share from continuing operations attributable to the Company’s shareholders, diluted (RMB) ​ 5.01 ​ 5.98 ​ 9.05 Net income per share from discontinued operations attributable to the Company’s shareholders, diluted (RMB) ​ — ​ 0.19 ​ — Net income per share, diluted (RMB) 5.01 6.17 9.05

Commitments and Contingencies (

Commitments and Contingencies (Tables)	12 Months Ended
	Dec. 31, 2023
Commitments and Contingencies
Schedule of future commitments under various contracts	As of December 31, 2023, future minimum payment for server and bandwidth service fee commitments, capital commitments, royalties and other expenditures commitments related to licensed contents, as well as other commitments related to services purchases, were as follows (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Server and ​ ​ ​ Royalties and ​ ​ ​ ​ ​ ​ Bandwidth ​ ​ ​ Expenditure for ​ ​ ​ ​ ​ ​ Service Fee ​ Capital ​ Licensed Content ​ Other ​ ​ ​ Commitments Commitments Commitments Commitments Total ​ ​ RMB ​ RMB ​ RMB ​ RMB ​ RMB 2024 439,118 ​ 1,473,870 ​ 688,387 ​ 297,149 ​ 2,898,524 2025 366,162 ​ 341,700 ​ 271,125 ​ 4,756 ​ 983,743 2026 212,431 ​ 55,446 ​ 215,376 ​ 474 ​ 483,727 2027 ​ 102,479 ​ 33,439 ​ 99,876 ​ — ​ 235,794 Beyond 2027 188,776 ​ 38,744 ​ — ​ — ​ 227,520 ​ 1,308,966 ​ 1,943,199 ​ 1,274,764 ​ 302,379 ​ 4,829,308

Segment Information (Tables)

Segment Information (Tables)	12 Months Ended
	Dec. 31, 2023
Segment Information
Summary of the Group's operating segment results	There was no significant transaction between reportable segments for the years ended December 31, 2021, 2022 and 2023 (in thousands). ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the year ended December 31, ​ 2021 2022 2023 ​ ​ RMB ​ RMB ​ RMB Net revenues: ​ ​ ​ ​ ​ ​ Games and related value-added services 67,819,288 ​ 74,566,471 ​ 81,565,449 Youdao 5,354,357 ​ 5,013,182 ​ 5,389,208 Cloud Music ​ 6,997,622 ​ 8,992,221 ​ 7,866,992 Innovative businesses and others 7,434,759 ​ 7,923,935 ​ 8,646,510 Total net revenues 87,606,026 ​ 96,495,809 ​ 103,468,159 ​ ​ ​ ​ ​ ​ ​ Cost of revenues: ​ ​ ​ ​ ​ ​ Games and related value-added services (26,007,412) ​ (27,784,419) ​ (25,938,865) Youdao (2,448,146) ​ (2,430,738) ​ (2,621,746) Cloud Music ​ (6,854,948) ​ (7,699,103) ​ (5,764,322) Innovative businesses and others (5,324,719) ​ (5,815,423) ​ (6,079,832) Total cost of revenues (40,635,225) ​ (43,729,683) ​ (40,404,765) ​ ​ ​ ​ ​ ​ ​ Gross profit: ​ ​ ​ ​ ​ ​ Games and related value-added services 41,811,876 ​ 46,782,052 ​ 55,626,584 Youdao 2,906,211 ​ 2,582,444 ​ 2,767,462 Cloud Music ​ 142,674 ​ 1,293,118 ​ 2,102,670 Innovative businesses and others 2,110,040 ​ 2,108,512 ​ 2,566,678 Total gross profit 46,970,801 ​ 52,766,126 ​ 63,063,394
Schedule of disaggregation of net revenues by timing of revenue recognition	The following table set forth the disaggregation of net revenues by timing of revenue recognition for the years ended December 31, 2021, 2022 and 2023 (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the year ended December 31, ​ 2021 2022 2023 ​ ​ RMB ​ RMB ​ RMB A point in time ​ 19,581,668 ​ 23,322,675 ​ 27,140,994 Over time ​ 68,024,358 ​ 73,173,134 ​ 76,327,165 Total Net revenue 87,606,026 96,495,809 103,468,159
Schedule of total depreciation expenses of property and equipment recorded under cost of revenues by segment	The following table presents the total depreciation expenses of property and equipment recorded under cost of revenues by segment for the years ended December 31, 2021, 2022 and 2023 (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the year ended December 31, ​ 2021 2022 2023 ​ ​ RMB ​ RMB ​ RMB Games and related value-added services 278,780 ​ 339,300 ​ 223,156 Youdao 9,330 ​ 11,610 ​ 9,275 Cloud Music ​ 3,827 ​ 6,044 ​ 2,452 Innovative businesses and others 114,442 ​ 129,693 ​ 60,126 Total depreciation expenses of property and equipment 406,379 ​ 486,647 ​ 295,009 ​

Financial Instruments (Tables)

Financial Instruments (Tables)	12 Months Ended
	Dec. 31, 2023
Financial Instruments
Schedule of financial instruments measured at fair value	The following table sets forth the financial instruments, measured at fair value, by level within the fair value hierarchy as of December 31, 2022 (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Fair Value Measurements ​ ​ (RMB) ​ ​ ​ ​ ​ ​ ​ Quoted Prices in ​ ​ ​ ​ ​ ​ ​ ​ Active Market ​ Significant Other ​ Significant ​ ​ ​ ​ for Identical ​ Observable ​ Unobservable ​ ​ ​ ​ Assets ​ Inputs ​ Inputs ​ Total (Level 1) (Level 2) (Level 3) Equity investments with readily determinable fair values ​ 2,567,268 ​ 2,567,268 ​ — ​ — Short-term investments 7,622,673 ​ — 7,622,673 ​ — Investments accounted for at fair values 246,073 ​ — ​ — ​ 246,073 Total ​ 10,436,014 ​ 2,567,268 7,622,673 ​ 246,073 ​ The following table sets forth the financial instruments, measured at fair value, by level within the fair value hierarchy as of December 31, 2023 (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Fair Value Measurements ​ ​ (RMB) ​ ​ ​ ​ ​ ​ Quoted Prices in ​ ​ ​ ​ ​ ​ ​ ​ Active Market ​ Significant Other ​ Significant ​ ​ ​ ​ for Identical ​ Observable ​ Unobservable ​ ​ ​ ​ Assets ​ Inputs ​ Inputs ​ Total (Level 1) (Level 2) ​ (Level 3) Equity investments with readily determinable fair values ​ 3,107,266 ​ 3,107,266 ​ — ​ — Short-term investments 4,436,057 ​ — 4,436,057 ​ — Investments accounted for at fair values ​ 490,781 ​ — ​ — ​ 490,781 Total 8,034,104 ​ 3,107,266 4,436,057 ​ 490,781 ​

Organization and Nature of Op_3

Organization and Nature of Operations (Details)	Apr. 30, 2009 employee
Hangzhou Leihuo
Principle subsidiaries and variable interest entities
Number of employees incorporating new entity	2

Organization and Nature of Op_4

Organization and Nature of Operations - Combined financial information of the VIEs (Details) ¥ in Thousands, $ in Thousands	12 Months Ended
	Dec. 31, 2023 CNY (¥)	Dec. 31, 2023 USD ($)	Dec. 31, 2022 CNY (¥)	Dec. 31, 2021 CNY (¥)	Dec. 31, 2023 USD ($)
Consolidated Balance Sheets
Cash and cash equivalents	¥ 21,428,902		¥ 24,889,000		$ 3,018,198
Time deposits	100,856,034		84,947,679		14,205,275
Restricted cash	2,777,206		2,699,055		391,161
Accounts receivable, net	6,422,417		5,002,872		904,579
Inventories	695,374		993,636		97,941
Prepayments and other current assets, net	6,076,595		5,448,284		855,871
Short-term investments	4,436,057		7,622,673		624,806
Total current assets	142,692,585		131,603,199		20,097,831
Property, equipment and software, net	8,075,044		6,342,330		1,137,346
Operating lease right-of-use assets, net	749,275		887,977		105,533
Deferred tax assets	1,560,088		1,480,789		219,734
Restricted cash	550		270		77
Long-term investments	21,783,187		18,544,358		3,068,098
Other long-term assets	5,939,106		6,806,455		836,505
Total non-current assets	43,232,393		41,157,786		6,089,154
Total assets	185,924,978		172,760,985		26,186,985
Accounts payable	881,016		1,507,141		124,089
Salary and welfare payables	4,857,206		4,732,941		684,123
Taxes payable	2,571,534		2,813,096		362,193
Short-term loans	19,240,163		23,875,704		2,709,920
Contract liabilities	13,362,166		12,518,890		1,882,022
Accrued liabilities and other payables	12,670,906		11,122,022		1,784,660
Short-term operating lease liabilities	259,493		259,053		36,549
Total current liabilities	53,842,484		56,828,847		7,583,556
Long-term operating lease liabilities	555,829		672,640		78,287
Other long-term payable	715,284		604,934		100,745
Total non-current liabilities	3,998,413		7,058,658		563,164
Total liabilities	57,840,897		63,887,505		$ 8,146,720
Net revenues:
Total net revenues	103,468,159	$ 14,573,185	96,495,809	¥ 87,606,026
Cost of revenues and operating expenses
Net income	29,357,223	4,134,878	19,843,290	16,976,190
Cash flows from operating activities:
Net cash provided by/ (used in) operating activities	35,331,275	4,976,306	27,709,233	24,926,727
Cash flows from investing activities:
Net cash used in investing activities	(17,043,431)	(2,400,517)	(7,369,727)	(7,078,294)
Cash flows from financing activities:
Net cash (used in)/ provided by financing activities	(21,467,054)	$ (3,023,571)	(10,237,699)	(12,585,569)
Primary Beneficiary Consolidated VIEs
Consolidated Balance Sheets
Cash and cash equivalents	1,802,256		2,303,280
Time deposits	420,000		400,000
Restricted cash	2,701,083		2,654,971
Accounts receivable, net	4,663,331		3,542,272
Inventories	36,908		67,572
Prepayments and other current assets, net	1,765,209		1,867,110
Short-term investments	73,904		73,984
Amounts due from Group companies	¥ 9,192,463		¥ 9,917,091
Other Receivable, after Allowance for Credit Loss, Current, Related Party, Type [Extensible Enumeration]	srt:AffiliatedEntityMember		srt:AffiliatedEntityMember		srt:AffiliatedEntityMember
Total current assets	¥ 20,655,154		¥ 20,826,280
Property, equipment and software, net	52,212		78,666
Operating lease right-of-use assets, net	53,686		54,653
Deferred tax assets	148,847		155,595
Restricted cash	500		200
Long-term investments	1,212,804		885,372
Other long-term assets	203,744		164,968
Total non-current assets	1,671,793		1,339,454
Total assets	22,326,947		22,165,734
Accounts payable	265,137		802,717
Salary and welfare payables	114,794		155,478
Taxes payable	142,769		41,352
Short-term loans	16,095		422
Contract liabilities	12,401,426		11,465,101
Accrued liabilities and other payables	3,689,885		3,809,049
Short-term operating lease liabilities	22,413		20,690
Amounts due to Group companies	¥ 2,822,751		¥ 3,937,784
Other Liability, Current, Related Party, Type [Extensible Enumeration]	srt:AffiliatedEntityMember		srt:AffiliatedEntityMember		srt:AffiliatedEntityMember
Total current liabilities	¥ 19,475,270		¥ 20,232,593
Long-term operating lease liabilities	30,278		34,291
Other long-term payable	554,648		263,373
Total non-current liabilities	584,926		297,664
Total liabilities	20,060,196		20,530,257
Net revenues:
Total net revenues	90,789,401		83,367,406	75,215,169
Cost of revenues and operating expenses
Total cost of revenues and operating expenses	(90,484,679)		(83,321,481)	(74,643,007)
Net income	328,357		(81,329)	624,299
Cash flows from operating activities:
Net cash provided by/ (used in) operating activities	(333,662)		788,498	1,548,858
Cash flows from investing activities:
Net cash used in investing activities	(82,645)		(71,832)	(39,430)
Cash flows from financing activities:
Net cash (used in)/ provided by financing activities	(37,166)		(157,989)	(1,301,096)
Primary Beneficiary Consolidated VIEs' third-parties
Net revenues:
Total net revenues	90,054,544		82,549,444	74,406,521
Cost of revenues and operating expenses
Total cost of revenues and operating expenses	(17,468,565)		(18,358,287)	(17,651,675)
Cash flows from operating activities:
Net cash provided by/ (used in) operating activities	72,325,460		67,459,864	61,272,031
Cash flows from investing activities:
Net cash used in investing activities	(82,645)		(71,832)	(39,430)
Cash flows from financing activities:
Net cash (used in)/ provided by financing activities	15,673		(52,541)	(678,287)
Primary Beneficiary Consolidated VIEs' intra-Group companies
Net revenues:
Total net revenues	734,857		817,962	808,648
Cash flows from financing activities:
Net cash (used in)/ provided by financing activities	(52,839)		(105,448)	(622,809)
Primary Beneficiary Consolidated VIEs' intra-Group companies | Technical consulting and related service
Cost of revenues and operating expenses
Total cost of revenues and operating expenses	(72,992,568)		(64,777,586)	(56,822,482)
Cash flows from operating activities:
Net cash provided by/ (used in) operating activities	(73,298,667)		(66,970,818)	(59,439,552)
Primary Beneficiary Consolidated VIEs' intra-Group companies | Other transactions
Cash flows from operating activities:
Net cash provided by/ (used in) operating activities	639,545		299,452	(283,621)
Primary Beneficiary Consolidated VIEs' Other intra-Group Companies
Cost of revenues and operating expenses
Total cost of revenues and operating expenses	¥ (23,546)		¥ (185,608)	¥ (168,850)

Organization and Nature of Op_5

Organization and Nature of Operations - Additional information (Details)			12 Months Ended
	Dec. 01, 2015	May 12, 2010	Dec. 31, 2023 CNY (¥) entity	Dec. 31, 2022 CNY (¥) entity
Principle subsidiaries and variable interest entities
Amount of assets for settlement of obligations except for the registered capital of the VIEs and certain non-distributable statutory reserves			¥ 0	¥ 0
Registered capital of VIEs			626,100,000	659,700,000
Non-distributable statutory reserves of the consolidated VIEs			¥ 96,300,000	¥ 82,400,000
Number of entities for which the company has a variable interest but is not the primary beneficiary | entity			0	0
Guangzhou NetEase | Shareholder voting rights trust agreement
Principle subsidiaries and variable interest entities
Term of principal (or amended principal) agreement		20 years
Guangzhou NetEase | Letter of agreement
Principle subsidiaries and variable interest entities
Term of principal (or amended principal) agreement		20 years
Hangzhou Leihuo | Operating agreement
Principle subsidiaries and variable interest entities
Term of principal (or amended principal) agreement	20 years

Principal Accounting Policies -

Principal Accounting Policies - Revenue recognition, cost of revenues and cash, cash equivalents and time deposits (Details) ¥ in Thousands, $ in Thousands	12 Months Ended
	Dec. 31, 2023 CNY (¥) item	Dec. 31, 2023 USD ($)	Dec. 31, 2022 CNY (¥)	Dec. 31, 2022 USD ($)
Revenue recognition
Number of revenue models used for PC-client game services | item	2
Practical expedients - financing component	true
Practical expedients - costs to obtain a contract	true
Cash, cash equivalents and time deposits
Cash at bank and demand deposits	¥ 21,428,902	$ 3,018,198	¥ 24,889,000
PRC subsidiaries and VIEs
Cash, cash equivalents and time deposits
Cash and cash equivalent and time deposits held by PRC subsidiaries and VIEs | ¥	¥ 48,500,000		¥ 48,100,000
Percentage of cash and cash equivalent and time deposits held by PRC subsidiaries and VIEs	39.30%	39.30%	42.60%	42.60%
Denominated in U.S. dollars
Cash, cash equivalents and time deposits
Cash at bank and demand deposits	¥ 11,100,000	$ 1,600,000	¥ 4,300,000	$ 623,800
Time deposits	¥ 61,200,000	$ 8,600,000	¥ 58,600,000	$ 8,400,000
Less than
Revenue recognition
Term of sublicenses of music contents	3 years
Term of advertising service contracts	3 months
Equal to or more than
Revenue recognition
Term of sublicenses of music contents	1 year

Principal Accounting Policies_3

Principal Accounting Policies - Restricted cash and other lien arrangements (Details) ¥ in Millions	12 Months Ended
	Dec. 31, 2023 CNY (¥) agreement	Dec. 31, 2022 CNY (¥) agreement
Restricted cash
Total	¥ 2,777.8	¥ 2,699.3
Number of other lien arrangements | agreement	0	0
Customer deposit | NetEase Pay
Restricted cash
Total	¥ 2,664.1	¥ 2,627.5
Others
Restricted cash
Total	¥ 113.7	¥ 71.8

Principal Accounting Policies_4

Principal Accounting Policies - Receivables, net (Details) ¥ in Thousands, $ in Thousands	12 Months Ended
	Dec. 31, 2023 CNY (¥)	Dec. 31, 2023 USD ($)	Dec. 31, 2022 CNY (¥)	Dec. 31, 2021 CNY (¥)
Principal Accounting Policies
Balance at the beginning of year	¥ 403,360		¥ 369,982	¥ 113,253
Provisions	61,146	$ 8,612	61,393	265,930
Write-offs	(15,944)		(28,015)	(9,201)
Balance at the end of year	¥ 448,562		¥ 403,360	¥ 369,982

Principal Accounting Policies_5

Principal Accounting Policies - Property, equipment and software (Details)	Dec. 31, 2023
Building
Property, Equipment and Software
Estimated useful lives of assets	20 years
Decoration
Property, Equipment and Software
Estimated useful lives of assets	5 years
Leasehold improvements
Property, Equipment and Software
Estimated useful lives of assets	us-gaap:UsefulLifeTermOfLeaseMember
Furniture, fixtures, office and other equipment | Equal to or more than
Property, Equipment and Software
Estimated useful lives of assets	3 years
Furniture, fixtures, office and other equipment | Less than
Property, Equipment and Software
Estimated useful lives of assets	10 years
Vehicles
Property, Equipment and Software
Estimated useful lives of assets	5 years
Servers and computers | Equal to or more than
Property, Equipment and Software
Estimated useful lives of assets	3 years
Servers and computers | Less than
Property, Equipment and Software
Estimated useful lives of assets	5 years
Software
Property, Equipment and Software
Estimated useful lives of assets	3 years

Principal Accounting Policies_6

Principal Accounting Policies - Intangible assets, advertising and promotional expenses and foreign currency translation (Details) ¥ in Billions, $ in Billions	12 Months Ended
	Dec. 31, 2023 CNY (¥)	Dec. 31, 2023 USD ($)	Dec. 31, 2022 CNY (¥)	Dec. 31, 2021 CNY (¥)	Dec. 29, 2023 $ / ¥
Advertising and promotional expenses
Advertising and promotional expenses	¥ 10.4	$ 1.5	¥ 10	¥ 8.9
Foreign currency translation
Buying rate per US$					7.0999
License right
Intangible assets
Estimated useful lives of assets	over the license period	over the license period
Technology | Equal to or more than
Intangible assets
Estimated useful lives of assets	7 years	7 years
Technology | Less than
Intangible assets
Estimated useful lives of assets	10 years	10 years
Trademark
Intangible assets
Estimated useful lives of assets	10 years	10 years

Principal Accounting Policies_7

Principal Accounting Policies - Share-based compensation (Details)	12 Months Ended
	Dec. 31, 2023
Share based Compensation
Number of preceding years considered for estimating forfeiture	5 years
2009 Restricted Share Unit Plan and 2019 Restricted Share Unit Plan | Restricted share units | Equal to or more than
Share based Compensation
Service vesting period	1 year
2009 Restricted Share Unit Plan and 2019 Restricted Share Unit Plan | Restricted share units | Less than
Share based Compensation
Service vesting period	5 years
Certain subsidiaries | Stock options | Equal to or more than
Share based Compensation
Expiration period	4 years
Certain subsidiaries | Stock options | Less than
Share based Compensation
Expiration period	7 years

Principal Accounting Policies_8

Principal Accounting Policies - Taxation (Details)		12 Months Ended
	Mar. 16, 2007	Dec. 31, 2023
Principal Accounting Policies
Withholding tax rate on dividend distributed by foreign investment entities to its non-resident enterprise investors (as a percent)	10%	10%
Lower withholding income tax rate on dividend applied, if the non-resident enterprise investor is registered in Hong Kong with at least 25% equity interest in the PRC enterprise and meets the relevant conditions or requirements (as a percent)	5%	5%
Minimum equity interest in PRC entities (as a percent)	25%	25%

Principal Accounting Policies_9

Principal Accounting Policies - Statutory reserves (Details) - PRC	12 Months Ended
	Dec. 31, 2023
General reserve fund
Statutory reserves
Required minimum percentage of annual appropriations	10%
Statutory threshold percentage of the reserve fund to the registered capital of the respective company, above which the appropriation is not required	50%
Statutory surplus reserve
Statutory reserves
Required minimum percentage of annual appropriations	10%
Statutory threshold percentage of the reserve fund to the registered capital of the respective company, above which the appropriation is not required	50%

Discontinued Operations (Detail

Discontinued Operations (Details) ¥ in Thousands	12 Months Ended
	Dec. 31, 2022 CNY (¥)
Discontinued operations
Net income from discontinued operations	¥ 624,864
Kaola e-commerce business | Discontinued operations, disposed of by sale
Discontinued operations
Net income from discontinued operations	¥ 624,900

Acquisition (Details)

Acquisition (Details) - CNY (¥) ¥ in Thousands		12 Months Ended
		Dec. 31, 2022	Dec. 31, 2023	Dec. 31, 2021
Consideration for this transaction was allocated on the acquisition date based on the fair value of the assets acquired and the liabilities assumed as follows (in thousands):
Goodwill		¥ 2,166,486	¥ 1,855,394	¥ 595,280
Acquisitions in 2022
Acquisition
Equity interest acquired (as a percent)		50.50%
Cash consideration		¥ 760,400
Previously held equity interest in equity investments (as a percent)		41.50%
Equity interest after acquisition (as a percent)		92%
Gain in relation to the revaluation of the previously held equity interests		¥ 310,400
Consideration for this transaction was allocated on the acquisition date based on the fair value of the assets acquired and the liabilities assumed as follows (in thousands):
Net liabilities acquired		(34,671)
Deferred tax liabilities		(104,137)
Goodwill		1,571,206
Noncontrolling interests		(122,983)
Total		1,978,414
Acquisitions in 2022 | Trademark
Consideration for this transaction was allocated on the acquisition date based on the fair value of the assets acquired and the liabilities assumed as follows (in thousands):
Amortizable intangible assets	[1]	143,146
Acquisitions in 2022 | Other identified intangible assets
Consideration for this transaction was allocated on the acquisition date based on the fair value of the assets acquired and the liabilities assumed as follows (in thousands):
Amortizable intangible assets	[1]	¥ 525,853
[1]Trademarks and other identified intangible assets acquired in the acquisitions are included in “Copyrights, licenses, domain names, trademark and technology”.

Concentrations and Risks (Detai

Concentrations and Risks (Details)	12 Months Ended
	Dec. 31, 2023 item customer	Dec. 31, 2022 item customer	Dec. 31, 2021 item customer
Equal to or more than
Concentrations and Risks
Effective yields of short-term investments	1.85%	1.72%
Less than
Concentrations and Risks
Effective yields of short-term investments	8.31%	5%
Server and bandwidth service provider | Service providers | Telecommunication
Concentrations and Risks
Number of service providers, offering 10% or more of the Group's server and bandwidth service expenditure	4	4	4
Concentration risk (as a percent)	59.40%	62.70%	67.20%
Server and bandwidth service provider | Service providers | Equal to or more than
Concentrations and Risks
Threshold for disclosure of risk (as a percent)	10%	10%	10%
Server and bandwidth service provider | Service providers | Equal to or more than | Telecommunication
Concentrations and Risks
Total number of telecommunications service providers	100	100	100
Credit risk | Accounts receivable
Concentrations and Risks
Number of channels	1	1
Credit risk | Accounts receivable | Channel A
Concentrations and Risks
Concentration risk (as a percent)	23.50%	17.80%
Credit risk | Accounts receivable | Equal to or more than
Concentrations and Risks
Threshold for disclosure of risk (as a percent)	10%	10%
Credit risk | Short-term investments | Equal to or more than
Concentrations and Risks
Effective yields of short-term investments	1.85%
Credit risk | Short-term investments | Less than
Concentrations and Risks
Effective yields of short-term investments	8.31%
Major customers | Total net revenues
Concentrations and Risks
Number of customers | customer	0	0	0
Major customers | Total net revenues | Equal to or more than
Concentrations and Risks
Threshold for disclosure of risk (as a percent)	10%	10%	10%
Top 5 online games | Total net revenues
Concentrations and Risks
Top online games	5	5	5
Top 5 online games | Total net revenues | Top 5 Online Games
Concentrations and Risks
Concentration risk (as a percent)	36.80%	29.60%	29.20%

Prepayments and Other Current_3

Prepayments and Other Current Assets (Details) $ in Thousands	Dec. 31, 2023 CNY (¥)	Dec. 31, 2023 USD ($)	Dec. 31, 2022 CNY (¥)
Prepayments and Other Current Assets
Guarantee payment made to Blizzard - royalty fees			¥ 634,909,000
Prepayment for royalties, revenue sharing cost	¥ 1,729,241,000		1,787,638,000
Interest receivable	2,271,944,000		1,373,854,000
Prepayments of content and marketing cost and other operational expenses	638,697,000		725,183,000
Prepayment for deductible value added tax and refundable subsidy	581,228,000		492,552,000
Bridge loans in connection with ongoing investments	27,369,000		43,313,000
Deposits	81,712,000		68,285,000
Employee advances	57,949,000		61,480,000
Advance to suppliers	43,820,000		105,903,000
Receivable within one-year related to disposal of investments	512,367,000
Others	132,268,000		155,167,000
Prepayments and other current assets	6,076,595,000	$ 855,871	5,448,284,000
Staff housing loans outstanding repayable within 12 months	18,200,000		22,700,000
Advances made directly or indirectly to the executive officers for their personal benefit	¥ 0		¥ 0

Short-term Investments (Details

Short-term Investments (Details) - CNY (¥) ¥ in Thousands	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022	Dec. 31, 2021
Short-term Investments
Cost	¥ 4,275,329	¥ 7,563,805
Unrealized Gains	160,728	58,868
Estimated Fair Value	¥ 4,436,057	¥ 7,622,673
Investment, Type [Extensible Enumeration]	Short-term Investments [Member]	Short-term Investments [Member]
Investment income related to short-term investments	¥ 414,200	¥ 342,600	¥ 639,800
Equal to or more than
Short-term Investments
Short-term investments, effective yields (as a percent)	1.85%	1.72%
Investment, Type [Extensible Enumeration]	Short-term Investments [Member]	Short-term Investments [Member]
Less than
Short-term Investments
Short-term investments, effective yields (as a percent)	8.31%	5%
Investment, Type [Extensible Enumeration]	Short-term Investments [Member]	Short-term Investments [Member]

Property, Equipment and Softw_3

Property, Equipment and Software, net (Details) ¥ in Thousands, $ in Thousands	12 Months Ended
	Dec. 31, 2023 CNY (¥)	Dec. 31, 2022 CNY (¥)	Dec. 31, 2021 CNY (¥)	Dec. 31, 2023 USD ($)
Summary of property, equipment and software
Gross book value	¥ 15,176,363	¥ 12,612,721
Less: accumulated depreciation	(6,923,618)	(6,270,391)
Less: impairment	(177,701)
Net book value	8,075,044	6,342,330		$ 1,137,346
Depreciation expense	769,700	1,127,200	¥ 928,500
Building and decoration
Summary of property, equipment and software
Gross book value	4,063,468	3,875,063
Leasehold improvements
Summary of property, equipment and software
Gross book value	311,156	304,365
Furniture, fixtures, office and other equipment
Summary of property, equipment and software
Gross book value	508,185	379,938
Vehicles
Summary of property, equipment and software
Gross book value	106,027	102,823
Servers and computers
Summary of property, equipment and software
Gross book value	6,144,176	6,018,709
Software
Summary of property, equipment and software
Gross book value	367,472	344,410
Construction in progress
Summary of property, equipment and software
Gross book value	¥ 3,675,879	¥ 1,587,413

Land Use Rights, net (Details)

Land Use Rights, net (Details) - Land use rights - CNY (¥) ¥ in Thousands	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022	Dec. 31, 2021
Land Use Rights, net
Cost	¥ 4,590,902	¥ 4,521,308
Incentive payment from local government	(15,000)	(15,000)
Accumulated amortization	(486,475)	(384,541)
Impairment	(14,284)
Land use right, net	4,075,143	4,121,767
Total amortization expense	¥ 101,900	¥ 91,800	¥ 87,400

Leases (Details)

Leases (Details) ¥ in Thousands, $ in Thousands	12 Months Ended
	Dec. 31, 2023 CNY (¥)	Dec. 31, 2022 CNY (¥)	Dec. 31, 2021 CNY (¥)	Dec. 31, 2023 USD ($)
Leases
Land use rights with total carrying amount	¥ 749,275	¥ 887,977		$ 105,533
Options to terminate the leases (true or false)	true
Operating lease cost	¥ 344,606	409,196	¥ 461,542
Cash paid for amounts included in the measurement of operating lease liabilities	331,579	471,214	503,127
Right-of-use assets obtained in exchange for operating lease obligations	215,209	336,381	763,919
Short-term lease cost	¥ 42,300	¥ 27,400	¥ 31,400
Weighted average remaining lease term (in years)	2 years 11 months 1 day	3 years 2 months 19 days		2 years 11 months 1 day
Weighted average discount rate	3.77%	3.82%		3.77%
Equal to or more than
Leases
Remaining lease terms (in months or years)	1 month			1 month
Less than
Leases
Remaining lease terms (in months or years)	67 years			67 years
ASC 842 | Cumulative effect of changes in accounting principles | Land use rights
Leases
Land use rights with total carrying amount	¥ 4,100,000	¥ 4,100,000

Leases - Maturities of operatin

Leases - Maturities of operating lease liabilities (Details) ¥ in Thousands	Dec. 31, 2023 CNY (¥)
Leases
2024	¥ 284,976
2025	193,875
2026	132,049
2027	85,279
2028	83,947
Thereafter	106,998
Total operating lease payments	887,124
Less: imputed interest	(71,802)
Total	¥ 815,322

Long-term Investments - Summary

Long-term Investments - Summary of long-term investments (Details) ¥ in Thousands, $ in Thousands	Dec. 31, 2023 CNY (¥)	Dec. 31, 2023 USD ($)	Dec. 31, 2022 CNY (¥)
Long-term Investments
Investments in equity method investees	¥ 6,109,240		¥ 5,239,242
Equity investments with readily determinable fair values	3,107,266		2,567,268
Equity investments without readily determinable fair values	12,021,518		10,463,304
Investments accounted for at fair values	490,781		246,073
Debt investments	54,382		28,471
Total	¥ 21,783,187	$ 3,068,098	¥ 18,544,358

Long-term Investments - Additio

Long-term Investments - Additional information (Details) $ in Thousands	1 Months Ended		12 Months Ended
	Jul. 31, 2015 CNY (¥)	Aug. 31, 2013 CNY (¥)	Dec. 31, 2023 CNY (¥) LimitedPartnership	Dec. 31, 2023 USD ($) LimitedPartnership	Dec. 31, 2022 CNY (¥) LimitedPartnership	Dec. 31, 2021 CNY (¥)
Investments in equity method investees
Consideration in cash			¥ 444,557,000	$ 62,615	¥ 705,907,000	¥ 1,124,429,000
Equity investments with readily determinable fair values
Fair value gain/(loss) of equity investments with readily determinable fair values			535,300,000		(3,400,000,000)	91,100,000
Cash dividend income recorded			51,000,000		26,500,000	18,900,000
Investment income, net
Investments in equity method investees
Equity share of earnings			473,900,000		1,300,000,000	1,600,000,000
Equity investments without readily determinable fair value
Upward adjustments to the carrying value of equity securities without readily determinable fair value			0		0	380,800,000
Gain related to the disposal of the Group's investments in equity securities without readily determinable fair value			¥ 22,300,000		1,784,900,000	172,500,000
Limited partnership invested to operate online game business
Investments in equity method investees
Aggregated cash consideration					¥ 1,900,000,000
Number of limited partnerships invested | LimitedPartnership			3	3	5
Consideration in cash			¥ 128,200,000
Yixin
Investments in equity method investees
Consideration in cash	¥ 127,500,000	¥ 200,000,000
Percentage of equity interest acquired	35%	27%
Impairment of equity investment					¥ 197,700,000
AppLovin Corporation
Equity investments with readily determinable fair values
Equity investments with readily determinable fair values			991,600,000
Alibaba Group Holding Limited
Equity investments with readily determinable fair values
Equity investments with readily determinable fair values			983,400,000
Shenzhen Transsion Holding Limited
Equity investments with readily determinable fair values
Equity investments with readily determinable fair values			493,000,000
Huatai Securities Company Limited
Equity investments with readily determinable fair values
Equity investments with readily determinable fair values			419,000,000
Embracer Group AB (publ)
Equity investments with readily determinable fair values
Equity investments with readily determinable fair values			152,900,000
Certain of equity investments | Investment income, net
Equity investments without readily determinable fair value
Impairment provision related to certain of the equity investments without readily determinable fair value			¥ 274,200,000		¥ 85,200,000	¥ 19,200,000

Other Long-term Assets - Summar

Other Long-term Assets - Summary of other long-term assets (Details) ¥ in Thousands, $ in Thousands	Dec. 31, 2023 CNY (¥)	Dec. 31, 2023 USD ($)	Dec. 31, 2022 CNY (¥)	Dec. 31, 2021 CNY (¥)
Other Long-term Assets
Copyrights, licenses, domain names, trademark and technology	¥ 1,884,603		¥ 2,117,688
Goodwill	1,855,394		2,166,486	¥ 595,280
Long-term receivable	1,500,100		1,638,572
Non-current deposits	179,399		174,357
Long-term interest receivables	38,174		100,397
Staff housing loans	34,690		39,228
Others	446,746		569,727
Total	¥ 5,939,106	$ 836,505	¥ 6,806,455

Other Long-term Assets - Goodwi

Other Long-term Assets - Goodwill (Details) - CNY (¥)	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022
Goodwill
Beginning balance	¥ 2,166,486,000	¥ 595,280,000
Additions		1,571,206,000
Disposal	(311,092,000)
Ending balance	1,855,394,000	2,166,486,000
Impairment charges	¥ 0	¥ 0

Other Long-term Assets - Additi

Other Long-term Assets - Additional information (Details) - CNY (¥) ¥ in Millions	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022
Housing loans made to employees
Term of staff housing loan (in years)	5 years
Staff housing loans outstanding repayable within 12 months	¥ 18.2	¥ 22.7
Prepayments and other current assets
Housing loans made to employees
Staff housing loans outstanding repayable within 12 months	¥ 18.2	¥ 22.7
Equal to or more than
Housing loans made to employees
Interest rate on staff housing loan (as a percent)	2.10%	2.10%
Less than
Housing loans made to employees
Interest rate on staff housing loan (as a percent)	4.75%	4.75%

Taxation (Details)

Taxation (Details) ¥ / shares in Units, $ in Millions	12 Months Ended
	Dec. 31, 2023 CNY (¥) ¥ / shares	Dec. 31, 2023 HKD ($)	Dec. 31, 2022 CNY (¥) ¥ / shares	Dec. 31, 2022 HKD ($)	Dec. 31, 2021 CNY (¥) ¥ / shares	Dec. 31, 2021 HKD ($)
Income taxes
Income tax rate (as a percent)	25%	25%	25%	25%	25%	25%
Combined effects of EIT exemptions and tax rate reductions
Aggregate amount of EIT exemptions and tax rate reductions	¥ 3,228,359,000		¥ 2,631,764,000		¥ 2,238,907,000
Earnings per share effect, basic (in CNY per share) | ¥ / shares	¥ 1		¥ 0.81		¥ 0.67
Earnings per share effect, diluted (in CNY per share) | ¥ / shares	¥ 0.99		¥ 0.80		¥ 0.66
Cayman Islands
Income taxes
Withholding tax amount	¥ 0
BVI
Income taxes
Withholding tax amount	¥ 0
Hong Kong
Income taxes
Income tax rate (as a percent)	16.50%	16.50%	16.50%	16.50%	16.50%	16.50%
Taxable income | $		$ 2		$ 2		$ 2
Hong Kong | Taxable income below threshold amount
Income taxes
Income tax rate (as a percent)	8.25%	8.25%	8.25%	8.25%	8.25%	8.25%
Hong Kong | Taxable income over threshold amount
Income taxes
Income tax rate (as a percent)	16.50%	16.50%	16.50%	16.50%	16.50%	16.50%
PRC
Income taxes
Income tax rate (as a percent)	25%	25%
PRC | Boguan, NetEase Hangzhou and certain other PRC subsidiaries | HNTEs
Income taxes
Preferential tax rate	15%	15%	15%	15%	15%	15%

Taxation - Component of income

Taxation - Component of income tax expenses (Details) ¥ in Thousands, $ in Thousands	12 Months Ended
	Dec. 31, 2023 CNY (¥)	Dec. 31, 2023 USD ($)	Dec. 31, 2022 CNY (¥)	Dec. 31, 2021 CNY (¥)
Component of income tax expenses
Current tax expense	¥ 4,568,267		¥ 4,542,168	¥ 3,720,321
Deferred tax expense	131,437		489,670	407,948
Income tax expenses	¥ 4,699,704	$ 661,939	¥ 5,031,838	¥ 4,128,269

Taxation - Reconciliation of di

Taxation - Reconciliation of differences between statutory and effective income tax rates (Details)	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022	Dec. 31, 2021
Reconciliation of the differences between the statutory income tax rate and the Group's effective income tax rate
Statutory income tax rate	25%	25%	25%
Permanent differences	(7.10%)	(5.00%)	(2.70%)
Effect due to different tax rates applicable to overseas entities	0.20%	0.20%	(1.80%)
Effect of lower tax rate applicable to HNTEs	(9.50%)	(10.10%)	(10.10%)
Change in valuation allowance	0.60%	1.80%	3.90%
Effect of withholding income tax	4.60%	8.80%	5.30%
Effective income tax rate	13.80%	20.70%	19.60%

Taxation - Net operating tax lo

Taxation - Net operating tax loss carry forwards (Details) ¥ in Billions	Dec. 31, 2023 CNY (¥)
Taxation
Net operating tax loss carry forwards	¥ 20.7

Taxation - Sales tax (Details)

Taxation - Sales tax (Details)	3 Months Ended	9 Months Ended	12 Months Ended
	Mar. 31, 2019	Dec. 31, 2019	Dec. 31, 2023	Dec. 31, 2022	Dec. 31, 2021	Dec. 31, 2020
Sales tax
Value added tax rate, services provided (as a percent)			6%
Value added tax rate, sales of general goods (as a percent)	16%	13%	13%	13%	13%	13%

Taxation - Deferred tax assets

Taxation - Deferred tax assets and liabilities & withholding income tax (Details) ¥ in Thousands, $ in Millions		12 Months Ended
	Mar. 16, 2007	Dec. 31, 2023 CNY (¥)	Dec. 31, 2022 CNY (¥)	Dec. 31, 2021 CNY (¥)	Dec. 31, 2023 USD ($)
Deferred tax assets:
Contract liabilities, primarily for advanced payments from online games customers		¥ 1,043,715	¥ 1,009,624
Accruals		808,527	654,348
Depreciation and amortization		2,180	7,100
Net operating tax loss carry forward		3,424,344	3,781,233
Deferred tax assets, gross		5,278,766	5,452,305
Less: valuation allowance		(3,718,678)	(3,971,516)	¥ (3,648,870)
Total		1,560,088	1,480,789
Deferred tax liabilities:
Withholding income tax		2,165,573	1,947,190
Others		133,730	178,930
Total		2,299,303	2,126,120
Movement of the aggregate valuation allowances for deferred tax assets
Balance at the beginning of the period		3,971,516	3,648,870	3,255,854
Net change for the year		(252,838)	322,646	393,016
Balance at the end of the period		¥ 3,718,678	3,971,516	3,648,870
Withholding income tax
Withholding tax rate on dividend distributed by foreign investment entities to its non-resident enterprise investors (as a percent)	10%	10%
Lower withholding income tax rate on dividend applied, if the non-resident enterprise investor is registered in Hong Kong with at least 25% equity interest in the PRC enterprise and meets the relevant conditions or requirements (as a percent)	5%	5%
Minimum equity interest in PRC entities (as a percent)	25%	25%
Accrued withholding tax liabilities		¥ 1,500,000	¥ 2,100,000	¥ 1,100,000	$ 214.7

Taxes Payable (Details)

Taxes Payable (Details) ¥ in Thousands, $ in Thousands	Dec. 31, 2023 CNY (¥)	Dec. 31, 2023 USD ($)	Dec. 31, 2022 CNY (¥)
Taxes Payable
Sales Tax payable	¥ 277,201		¥ 290,272
Withholding individual income taxes for employees	378,103		306,861
EIT payable	1,790,393		2,116,014
Others	125,837		99,949
Total taxes payable	¥ 2,571,534	$ 362,193	¥ 2,813,096

Short-term Loans (Details)

Short-term Loans (Details) - USD ($) $ in Billions	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022
Short-term Loan
Weighted average interest rate for the outstanding short-term loans (as a percent)	3.79%	4.36%
Uncommitted loan credit facilities
Short-term Loan
Credit facilities not utilized	$ 3.1
Guarantee agreements
Short-term Loan
Credit facilities not utilized	1.1
Unutilized amount of credit facilities taken by its subsidiaries	$ 2.3
Equal to or more than
Short-term Loan
Short-term loan, maturity term	7 days	7 days
Short-term loan, fixed interest rate (as a percent)	0.65%	0.65%
Less than
Short-term Loan
Short-term loan, maturity term	1 year	1 year
Short-term loan, fixed interest rate (as a percent)	5.85%	5.85%

Contract Liabilities (Details)

Contract Liabilities (Details) - CNY (¥) ¥ in Billions	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022
Contract Liabilities
Amount of revenues recognized included in the contract liabilities	¥ 12	¥ 11.8
Transaction price allocated to unsatisfied performance obligations	14
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2024-01-01
Contract Liabilities
Performance obligation recognized as revenue	¥ 13.4
Expected timing of performance obligation recognized as revenue (in months)	12 months

Accrued Liabilities and Other_3

Accrued Liabilities and Other Payables (Details) ¥ in Thousands, $ in Thousands	Dec. 31, 2023 CNY (¥)	Dec. 31, 2023 USD ($)	Dec. 31, 2022 CNY (¥)
Accrued Liabilities and Other Payables
Customer deposits on NetEase Pay accounts	¥ 3,268,237		¥ 3,113,107
Marketing expenses and promotion materials	3,063,280		2,046,559
Content cost	1,432,706		1,703,218
Accrued fixed assets related payables	1,027,401		635,566
Accrued revenue sharing	969,903		1,032,559
Professional fees and technical charges	789,955		595,491
Administrative expenses and other staff related cost	448,926		414,214
Deferred government grants	356,239		179,961
Acquisition considerations	204,229		203,584
Server and bandwidth service fees	196,202		246,243
Customer refund for licensed games	97,301		283,763
Accrued freight and warehousing charge	83,902		105,356
Others	732,625		562,401
Total accrued liabilities and other payables	¥ 12,670,906	$ 1,784,660	¥ 11,122,022

Long-term Loans (Details)

Long-term Loans (Details) - Term loan facility and revolving loan facility agreement - USD ($)	Jun. 02, 2021	Dec. 31, 2023	Dec. 31, 2022
Long-term loans
Maturity term	5 years
Aggregate commitments	$ 1,000,000,000
Commitment fee	0.20%
Borrowings outstanding		$ 0	$ 500,000,000
Pledge		$ 0	$ 0
LIBOR
Long-term loans
Basis points	0.85%

Noncontrolling Interests and _2

Noncontrolling Interests and Redeemable Noncontrolling Interests (Details) $ in Millions	1 Months Ended
	Dec. 31, 2021	Oct. 31, 2019	Apr. 30, 2018 USD ($) item
Cloud Music | Ordinary shares
Noncontrolling Interests and Redeemable Noncontrolling Interests
Stock re-designation/conversion ratio, into ordinary shares	1
Youdao
Noncontrolling Interests and Redeemable Noncontrolling Interests
Aggregated cash consideration from issuance of preferred shares | $			$ 70
Number of investors | item			2
Youdao | Class A ordinary shares
Noncontrolling Interests and Redeemable Noncontrolling Interests
Stock re-designation/conversion ratio, into ordinary shares		1

Capital Structure (Details)

Capital Structure (Details)	12 Months Ended
	Dec. 31, 2023
Capital Structure
Voting rights per share	one vote per share

Employee Benefits (Details)

Employee Benefits (Details) - CNY (¥) ¥ in Millions	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022	Dec. 31, 2021
Employee Benefits
Contributions to medical and pension schemes	¥ 1,786.5	¥ 1,710.4	¥ 1,463.8
Other employee benefits	1,398.1	1,202.8	1,044.5
Total group's employee welfare benefits expense	¥ 3,184.6	¥ 2,913.2	¥ 2,508.3

Share-based Compensation - Sche

Share-based Compensation - Schedule of share-based compensation cost (Details) - CNY (¥) ¥ in Thousands	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022	Dec. 31, 2021
Share-based compensation cost
Share-based compensation	¥ 3,242,810	¥ 3,174,160	¥ 3,041,492
Cost of revenues
Share-based compensation cost
Share-based compensation	823,765	758,413	833,389
Selling and marketing expenses
Share-based compensation cost
Share-based compensation	132,801	120,171	118,611
General and administrative expenses
Share-based compensation cost
Share-based compensation	1,119,018	1,214,995	1,105,547
Research and development expenses
Share-based compensation cost
Share-based compensation	¥ 1,167,226	¥ 1,080,581	¥ 983,945

Share-based Compensation - Rest

Share-based Compensation - Restricted Share Units Plan (Details) - shares		1 Months Ended	12 Months Ended
	Nov. 17, 2009	Oct. 31, 2019	Dec. 31, 2023	Nov. 30, 2009
Share based Compensation
Number of preceding years considered for estimating forfeiture			5 years
2009 Restricted Share Unit Plan
Share based Compensation
Number of ordinary shares reserved for issuance under the plan				323,694,050
Term of plan	10 years
2019 Restricted Share Unit Plan
Share based Compensation
Number of ordinary shares reserved for issuance under the plan		322,458,300
Term of plan		10 years

Share-based Compensation - Re_2

Share-based Compensation - Restricted Share Unit Award Activities -Table (Details) - 2009 Restricted Share Unit Plan and 2019 Restricted Share Unit Plan $ / shares in Units, shares in Thousands, $ in Millions, ¥ in Billions	12 Months Ended
	Dec. 31, 2023 USD ($) $ / shares shares	Dec. 31, 2022 $ / shares shares	Dec. 31, 2021 $ / shares shares	Dec. 31, 2023 CNY (¥)
Share based Compensation
Total unrecognized compensation cost related to unvested awards	$ 365.3			¥ 2.6
Weighted average remaining vesting period over which unrecognized compensation cost is recognized	1 year 5 months 23 days
Restricted share units
Number of RSUs
Outstanding at the beginning of the period (in shares) | shares	13,005	12,996	14,096
Granted (in shares) | shares	4,795	5,335	4,579
Vested (in shares) | shares	(5,190)	(4,630)	(5,067)
Forfeited (in shares) | shares	(523)	(696)	(612)
Outstanding at end of the period (in shares) | shares	12,087	13,005	12,996
Weighted average grant date fair value
Outstanding at the beginning of the period (in dollars per share) | $ / shares	$ 82.67	$ 75.40	$ 57.85
Granted (in dollars per share) | $ / shares	84.73	93.98	110.19
Vested (in dollars per share) | $ / shares	76.27	75.01	58.02
Forfeited (in dollars per share) | $ / shares	88.24	84.55	75.29
Outstanding at the end of the period (in dollars per share) | $ / shares	$ 86	$ 82.67	$ 75.40

Share-based Compensation - Re_3

Share-based Compensation - Restricted Share Unit Award Activities - Narrative (Details) - Restricted share units $ / shares in Units, $ in Billions	Dec. 31, 2023 USD ($) $ / shares shares
2009 Restricted Share Unit Plan and 2019 Restricted Share Unit Plan
Share based Compensation
Aggregate intrinsic value of RSUs outstanding | $	$ 1.1
Company's closing stock price per ADS used to calculate intrinsic value | $ / shares	$ 93.16
2019 Restricted Share Unit Plan
Share based Compensation
Number of shares available for future grant | shares	236,724,510

Share-based Compensation - Othe

Share-based Compensation - Other Share Incentive Plan (Details) ¥ in Thousands	12 Months Ended
	Dec. 31, 2023 CNY (¥) installment	Dec. 31, 2022 CNY (¥)	Dec. 31, 2021 CNY (¥)
Share based Compensation
Compensation expenses | ¥	¥ 3,242,810	¥ 3,174,160	¥ 3,041,492
Unrecognized share based compensation expenses relating to share options | ¥	21,000
Stock options
Share based Compensation
Compensation expenses | ¥	¥ 289,000	¥ 327,900	¥ 528,200
Certain subsidiaries | Stock options | Vesting option I
Share based Compensation
Percentage of vesting of equity awards on the predefined Vesting Commencement Date	100%
Certain subsidiaries | Stock options | Vesting option II
Share based Compensation
Number of equal installments of vesting of equity awards from the predefined Vesting Commencement Date	2
Certain subsidiaries | Stock options | Vesting option III
Share based Compensation
Number of equal installments of vesting of equity awards from the predefined Vesting Commencement Date	3
Certain subsidiaries | Stock options | Vesting option IV
Share based Compensation
Number of equal installments of vesting of equity awards from the predefined Vesting Commencement Date	4
Certain subsidiaries | Stock options | Vesting option V
Share based Compensation
Number of equal installments of vesting of equity awards from the predefined Vesting Commencement Date	5
Certain subsidiaries | Equal to or more than | Stock options
Share based Compensation
Expiration period	4 years
Certain subsidiaries | Less than | Stock options
Share based Compensation
Expiration period	7 years

Net Income Per Share (Details)

Net Income Per Share (Details) ¥ / shares in Units, $ / shares in Units, ¥ in Thousands, shares in Thousands, $ in Thousands	12 Months Ended
	Dec. 31, 2023 CNY (¥) ¥ / shares shares	Dec. 31, 2023 USD ($) $ / shares shares	Dec. 31, 2022 CNY (¥) ¥ / shares shares	Dec. 31, 2021 CNY (¥) ¥ / shares shares
Numerator (RMB in thousands):
Net income from continuing operations attributable to the Company's shareholders	¥ 29,416,552	$ 4,143,234	¥ 19,712,736	¥ 16,856,842
Net income from discontinued operations attributable to the Company's shareholders | ¥			624,864
Net income attributable to the Company's shareholders	¥ 29,416,552	$ 4,143,234	¥ 20,337,600	¥ 16,856,842
Denominator (No. of shares in thousands):
Weighted average number of ordinary shares outstanding, basic (in shares)	3,216,475	3,216,475	3,263,455	3,325,864
Dilutive effect of restricted share units (in shares)	35,554	35,554	32,559	41,614
Weighted average number of ordinary shares outstanding, diluted (in shares)	3,252,029	3,252,029	3,296,014	3,367,478
Net income per share from continuing operations attributable to the Company's shareholders, basic (in CNY per share) | (per share)	¥ 9.15	$ 1.29	¥ 6.04	¥ 5.07
Net income per share from discontinued operations attributable to the Company's shareholders, basic (in CNY per share) | ¥ / shares			0.19
Net income per share, basic (in CNY and dollars per share) | (per share)	9.15	1.29	6.23	5.07
Net income per share from continuing operations attributable to the Company's shareholders, diluted (in CNY per share) | (per share)	9.05	1.27	5.98	5.01
Net income per share from discontinued operations attributable to the Company's shareholders, diluted (in CNY per share) | ¥ / shares			0.19
Net income per share, diluted (in CNY and dollars per share) | (per share)	¥ 9.05	$ 1.27	¥ 6.17	¥ 5.01
Anti-dilutive restricted share units excluded from the calculation of diluted net income per share (in shares)	6,300	6,300	11,300	6,700

Commitments and Contingencies_2

Commitments and Contingencies (Details) ¥ in Thousands, $ in Millions	1 Months Ended
	May 31, 2023 USD ($)	Apr. 30, 2018 item	Dec. 31, 2023 CNY (¥)
Litigation
Number of mobile games involved in the lawsuit | item		2
Liquidated damages awarded | $	$ 6
Total
Commitments and Contingencies
2024			¥ 2,898,524
2025			983,743
2026			483,727
2027			235,794
Beyond 2027			227,520
Total			4,829,308
Server and Bandwidth Service Fee Commitments
Commitments and Contingencies
2024			439,118
2025			366,162
2026			212,431
2027			102,479
Beyond 2027			188,776
Total			1,308,966
Capital Commitments
Commitments and Contingencies
2024			1,473,870
2025			341,700
2026			55,446
2027			33,439
Beyond 2027			38,744
Total			1,943,199
Royalties and Expenditure for Licensed Content Commitments
Commitments and Contingencies
2024			688,387
2025			271,125
2026			215,376
2027			99,876
Total			1,274,764
Other Commitments
Commitments and Contingencies
2024			297,149
2025			4,756
2026			474
Total			¥ 302,379

Dividends (Details)

Dividends (Details) $ in Billions	12 Months Ended
	Dec. 31, 2023 CNY (¥)	Dec. 31, 2023 USD ($)	Dec. 31, 2022 CNY (¥)	Dec. 31, 2021 CNY (¥)
Dividends
Dividend payable	¥ 0		¥ 0
Cash dividend declared	8,013,894,000		6,723,859,000	¥ 3,508,379,000
With respect to fiscal year 2022
Dividends
Cash dividend declared			¥ 6,300,000,000
With respect to fiscal year 2023
Dividends
Cash dividend declared	¥ 11,700,000,000	$ 1.7

Share Repurchase Programs (Deta

Share Repurchase Programs (Details) ¥ in Thousands, shares in Millions, $ in Millions			1 Months Ended		12 Months Ended
	Jan. 09, 2023 USD ($) shares	Nov. 17, 2022 USD ($)	Aug. 31, 2021 USD ($)	Feb. 28, 2021 USD ($)	Dec. 31, 2023 CNY (¥) shares	Dec. 31, 2023 USD ($) shares	Dec. 31, 2022 CNY (¥)	Dec. 31, 2021 CNY (¥)
Share Repurchase Programs
Value of shares repurchased | ¥					¥ 4,791,014		¥ 8,006,226	¥ 12,770,301
American Depositary Shares | 2021 share repurchase program
Share Repurchase Programs
Authorized amount			$ 3,000	$ 2,000
Share repurchase program period, maximum				24 months
Shares repurchased (in shares) | shares	33.6
Value of shares repurchased	$ 3,000
American Depositary Shares | 2021 share repurchase program | Youdao
Share Repurchase Programs
Authorized amount			$ 50
Share repurchase program period, maximum			36 months
Shares repurchased (in shares) | shares					2.7	2.7
Value of shares repurchased						$ 22
American Depositary Shares | 2022 share repurchase program
Share Repurchase Programs
Authorized amount		$ 5,000
Share repurchase program period, maximum		36 months
Shares repurchased (in shares) | shares					7.2	7.2
Value of shares repurchased						$ 644.1

Segment Information (Details)

Segment Information (Details) ¥ in Thousands, $ in Thousands	12 Months Ended
	Dec. 31, 2023 CNY (¥)	Dec. 31, 2023 USD ($)	Dec. 31, 2022 CNY (¥)	Dec. 31, 2021 CNY (¥)
Net revenues:
Total net revenues	¥ 103,468,159	$ 14,573,185	¥ 96,495,809	¥ 87,606,026
Cost of revenues:
Total cost of revenues	(40,404,765)	(5,690,892)	(43,729,683)	(40,635,225)
Gross profit:
Gross profit	63,063,394	$ 8,882,293	52,766,126	46,970,801
Depreciation expenses
Total depreciation expenses of property and equipment	295,009		486,647	406,379
A point in time
Net revenues:
Total net revenues	27,140,994		23,322,675	19,581,668
Over time
Net revenues:
Total net revenues	76,327,165		73,173,134	68,024,358
Games and related value-added services
Net revenues:
Total net revenues	81,565,449		74,566,471	67,819,288
Cost of revenues:
Total cost of revenues	(25,938,865)		(27,784,419)	(26,007,412)
Gross profit:
Gross profit	55,626,584		46,782,052	41,811,876
Depreciation expenses
Total depreciation expenses of property and equipment	223,156		339,300	278,780
Youdao
Net revenues:
Total net revenues	5,389,208		5,013,182	5,354,357
Cost of revenues:
Total cost of revenues	(2,621,746)		(2,430,738)	(2,448,146)
Gross profit:
Gross profit	2,767,462		2,582,444	2,906,211
Depreciation expenses
Total depreciation expenses of property and equipment	9,275		11,610	9,330
Cloud Music
Net revenues:
Total net revenues	7,866,992		8,992,221	6,997,622
Cost of revenues:
Total cost of revenues	(5,764,322)		(7,699,103)	(6,854,948)
Gross profit:
Gross profit	2,102,670		1,293,118	142,674
Depreciation expenses
Total depreciation expenses of property and equipment	2,452		6,044	3,827
Innovative businesses and others
Net revenues:
Total net revenues	8,646,510		7,923,935	7,434,759
Cost of revenues:
Total cost of revenues	(6,079,832)		(5,815,423)	(5,324,719)
Gross profit:
Gross profit	2,566,678		2,108,512	2,110,040
Depreciation expenses
Total depreciation expenses of property and equipment	¥ 60,126		¥ 129,693	¥ 114,442

Financial Instruments (Details)

Financial Instruments (Details) ¥ in Thousands, $ in Thousands	12 Months Ended
	Dec. 31, 2023 CNY (¥)	Dec. 31, 2022 CNY (¥)	Dec. 31, 2023 USD ($)
Fair Value Measurements
Equity investments with readily determinable fair values	¥ 3,107,266	¥ 2,567,268
Short-term investments	4,436,057	7,622,673	$ 624,806
Investments accounted for at fair values	490,781	246,073
Total	8,034,104	10,436,014
Quoted Prices in Active Market for Identical Assets (Level 1)
Fair Value Measurements
Equity investments with readily determinable fair values	3,107,266	2,567,268
Total	3,107,266	2,567,268
Significant Other Observable Inputs (Level 2)
Fair Value Measurements
Short-term investments	4,436,057	7,622,673
Total	4,436,057	7,622,673
Significant Unobservable Inputs (Level 3)
Fair Value Measurements
Investments accounted for at fair values	490,781	246,073
Total	490,781	246,073
Significant Unobservable Inputs (Level 3) | Certain of equity investments
Fair Value Measurements
Impairment charges of certain equity investments without determinable fair value	¥ 274,200	¥ 85,200

Restricted Net Assets (Details)

Restricted Net Assets (Details) ¥ in Billions	12 Months Ended
	Dec. 31, 2023 CNY (¥)
Restricted Net Assets
Restricted net assets	¥ 13.8
Restricted net assets as a percentage of total consolidated net assets	11%
PRC | General reserve fund
Restricted Net Assets
Required minimum percentage of annual appropriations	10%
PRC | Statutory surplus reserve
Restricted Net Assets
Required minimum percentage of annual appropriations	10%