Tanwan Inc. released its FY2025 results, reporting a sharp turnaround in profitability even as top-line contracted.
Financial Highlights (FY2025 vs FY2024) • Revenue: RMB 4.16 billion, down 25.50% from RMB 5.58 billion. • Net profit: RMB 1.56 billion, a surge from RMB 44.00 million, driven mainly by RMB 1.80 billion fair-value gains on financial assets. • Gross profit: RMB 2.37 billion, down 41.00%; gross margin slipped to 57.1% (2024: 72.1%). • Selling & distribution expenses: RMB 1.88 billion, down 46.70% on lower marketing spend and AI-enabled efficiency gains. • Administrative expenses: RMB 170.37 million, down 11.30%. • R&D costs: RMB 98.31 million, down 23.00%. • Basic EPS: RMB 2.83 (2024: loss per share below RMB0.01). • No final dividend proposed.
Segment Performance • Online game publishing contributed 97.4% of revenue (RMB 4.05 billion). – Self-run model: RMB 2.77 billion, 66.5% of total revenue, reflecting scaled-down promotions and softer performance from 2024 launches. – Joint-run model: RMB 1.28 billion, broadly stable year on year. • Consumer products (pop toys and “ZAZA GRAY” fast food): RMB 106.26 million, representing 2.6% of revenue. • Overseas revenue grew 33.60% to RMB 833.10 million, lifting its share of total sales to 20.0% (2024: 11.1%).
Balance Sheet & Cash Flow • Cash and cash equivalents: RMB 375.95 million (2024: RMB 514.96 million). • Gearing ratio fell to 0.02 (2024: 0.10); current ratio improved to 1.87 (2024: 1.28). • Capital expenditure jumped to RMB 219.50 million (2024: RMB 50.70 million), mainly for property, equipment and intangibles.
Capital Management • Share buy-back: 11.42 million shares repurchased for HK$172.50 million, equal to 2.1% of issued capital. • Convertible bonds: HK$468 million zero-coupon notes issued on 8 Jan 2026 to LMR Multi-Strategy Master Fund; proceeds earmarked for AI investments.
Strategic Developments • Name change from “ZX Inc.” to “Tanwan Inc.” effective 8 Aug 2025; overseas publishing unified under the “Game Lovin” brand. • “Five-Step Distribution Strategy” expanded into mini-program and global markets; mini-program title “City of Dragontrail” reached top spot on WeChat Mini Games. • AI integration: deployment of Seedance 2.0 and proprietary “Hetu” and “Luoshu” systems lifted ad-creation and placement efficiency by over 70%, with AI-generated creative penetration exceeding 80%. • Convertible-bond proceeds will support further “AI + Games” initiatives, including infrastructure, technology upgrades and strategic equity stakes in AI firms.
Outlook Tanwan plans sequential launches of titles based on “Soul Land”, “Yulgang”, “Legend”, and Jin Yong martial-arts IPs while pushing global expansion across Southeast Asia, Japan, Korea, Europe, America and the Middle East. The company intends to leverage AI-driven publishing, localized operations and its diversified IP pipeline to underpin future growth.