China's Kingsoft Net Profit Drops 25% In First Quarter As Games Decline

Chinese Internet company Kingsoft has published its unaudited financial results for the first quarter of 2011, stating that its net operating revenue declined by 6% year-on-year from CNY245 million to CNY231 million; and its net profit declined by 25% from CNY89.74 million to CNY66.89 million.According to the report, Kingsoft's revenue in the first quarter was 71% contributed by entertainment software and 28% contributed by application software.In the first three months of 2011, Kingsoft's income from entertainment software was CNY163 million, a decrease of 1% compared with the previous quarter and an increase of 1% compared with the same period of last year. The report of the company shows that the daily average peak number of concurrent users of Kingsoft's online games was 680,000, a decrease of 11% compared with the previous quarter and a decrease of 25% compared with the same period of last year.Meanwhile, its monthly average number of paid users was 1.26 million, a decrease of 7% compared with the previous quarter and a decrease of 14% compared with the same period of last year. During the reporting period, the monthly average consumption of each paid users was CNY43, an increase of 5% compared with the previous quarter and an increase of 19% compared with the same period of last year.Kingsoft's revenue from application software was CNY64.3 million, a decrease of 21% compared with the previous quarter and a decrease of 22% compared with the same period of last year. The main reasons for the revenue decrease were because the seasonal factors for the sales of Kingsoft's WPS Office software and the launch of Kingsoft's free-edition network security product since November 2010.