According to Netease's (NTES) unaudited financial results for the first quarter ended March 31, 2006, total revenues for the quarter grew 8.7%.

While revenues for the quarter grew 8.7% quarter-over-quarter, they grew 61.7% year-over-year to CNY529.8 million.

For the first quarter of 2006, total revenues increased to CNY529.8 million, representing 8.7% growth from CNY487.3 million for the preceding fourth quarter of 2005, and 61.7% growth from CNY327.7 million for the same period last year.

Revenues from advertising services declined by 10.9% to CNY61.6 million, compared to the preceding quarter's CNY69.1 million, primarily as a result of a seasonal decline in spending by certain advertisers during the first quarter of 2006. This represents an increase of 36.0% over CNY45.3 million for the corresponding period a year ago.

Online game revenues for the quarter exceeded the company's guidance and increased 12.4% quarter-over-quarter and 71.9% year-over-year to CNY450.6 million, driven primarily by double digit growth in Fantasy Westward Journey as a result of the continued organic growth and, in particular, after players celebrated the second anniversary of the game in January 2006.

Revenues from the company's wireless value-added services and others increased to CNY17.6 million for the first quarter of 2006, representing a slight increase of 2.3% over the preceding quarter's CNY17.2 million and 13.0% decrease from CNY20.3 million for the first quarter of 2005.

GAAP gross profit for the first quarter of 2006 was CNY420.9 million.


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