Cloud Village, NetEase’s music streaming arm, is running the NetEase Cloud Music app viewed on a smartphone in this image.
Fan Jianli | China Optical Group | Getty Images
Guangzhou, China – Cloud Village – the music-streaming arm of NetEase – is moving ahead with an initial public offering in Hong Kong after it was reported to have delayed it earlier this year.
NetEase originally submitted an application to list Cloud Village in August. Several reports at the time said NetEase had delayed its IPO due to volatile markets.
But on Tuesday, the company submitted a revised prospectus to the Hong Kong Stock Exchange indicating that it is moving forward with the listing.
There is no pricing or timing for listing yet.
Chinese tech stocks took a hit as Beijing introduced a slew of new regulations over the past year in areas from data privacy to anti-trust that surprised many investors.
Cloud Village runs NetEase’s music streaming business and the company says it has 185 million monthly active users.
Revenue for the nine months ended September 30 rose 51.5% year on year to 5.1 billion yuan ($799.6 million). Cloud Village’s revenue comes primarily from subscriptions, ads, and when users purchase virtual items on its platforms.
However, the company is still not very profitable because it is focused on increasing user numbers and content while fighting against competing music streaming service Tencent.
“Despite the continued increase in its user base, Cloud Village may continue to incur gross and net losses and net operating cash flow for the foreseeable future, including for the year ended December 31, 2021, due to its continued investments in content and technologies,” the company said in a statement to the Hong Kong Stock Exchange. Kong “Marketing initiatives in addition to research and development”.
Cloud Village’s parent company NetEase is one of the gaming giants in China and is looking to grow internationally with high-profile games including “Lord of the Rings” and “Harry Potter” titles.