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NetEase Shares Collapsed after the End of Its Blizzard Partnership

NetEase Inc. shares plunged after the company ended the 14-year partnership with Blizzard

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Aditya Saikrishna
Aditya Saikrishna
I am 21 years old and an avid Motorsports enthusiast.

CHINA: Blizzard Entertainment announced Thursday that it would end its partnership with NetEase once its agreement with the Chinese company expires next year.

Shares of the Chinese internet behemoth plunged after Blizzard’s announcement

In the announcement, California-based company stated that it could not reach an agreement with NetEase. 

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The gaming industry giant said the inability to reach an agreement consistent with Blizzard’s ideologies was the reason behind the discontinuation of the partnership.

In a Chinese statement, NetEase stated that it could not agree on essential terms of cooperation. In a second statement, the company stated that the expiry of the licenses would not impact its financial capabilities.

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In Hong Kong’s morning trading, NetEase’s shares fell about 11%, a comparatively less sharp decline of the shares that followed the announcement. 

William Ding, CEO of NetEase, released a statement saying that the company will continue to serve the players until the last moment. He added that the company would ensure the safety of player data and assets from all of its games.

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NetEase secured agreements to be Blizzard’s publishing partner in China after the World of Warcraft developer company ended its agreement with The9 Ltd. in 2008.

The agreement between both gaming giants will expire on Jan. 23. NetEase became China’s second-biggest gaming company after Tencent Holdings.

In the coming days, Blizzard said that it would stop new sales of its games and that players would get more information regarding the future of its games. 

The games likely to be suspended include Universe of Warcraft, Hearthstone, Warcraft III: Overwatch, StarCraft, Diablo III, and Heroes of the Storm. 

The recently released Diablo Immortal was co-developed by NetEase and Blizzard. Fortunately for the players, the game is covered by a separate long-term agreement, allowing its service to continue in China.

According to NetEase, Blizzard’s games made up a small portion of the company’s total net revenue and net income in 2021 and the first nine months of 2022. 

Meanwhile, according to Blizzard Entertainment, upcoming World of Warcraft releases include Hearthstone: Dragonflight, Season 2 of Overwatch 2 and March of the Lich King which will roll out later this year.

Also Read: Tweaked Nvidia Chips Developed for China under US Export Laws


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