HK-listed XD Inc shares jump 25% on stellar HY profit forecast

Chinese gaming firm Xd Inc (HK:2400) issued a positive profit alert, projecting H1 2025 revenue of at least RMB3.05 billion, a 37% year-on-year increase, and net profit to more than triple to RMB790 million, up 215% year-on-year. This strong performance, attributed to popular self-developed games and enhanced monetization on its TapTap platform, led to a surge of over 25% in its Hong Kong-listed shares, though the company noted these figures are preliminary and subject to audit.

Analysis

Xd Inc. (HK:2400) has issued a highly positive profit alert for the first half of 2025, signaling significant operational acceleration and triggering a more than 25% surge in its share price. The company projects revenue will grow 37% year-over-year to at least RMB3.05 billion and net profit will surge 215% to RMB790 million. This robust performance is reportedly driven by a combination of successful self-developed games, including 'Ragnarok M: Classic' and 'Torchlight: Infinite', and improved monetization on its TapTap gaming platform. The platform's growth is specifically attributed to enhanced advertising algorithms and stronger user engagement, suggesting underlying fundamental improvements. However, a key consideration is the company's disclosure that these figures are preliminary and subject to audit adjustments, which introduces a degree of uncertainty until the final results are published.

Key Decisions for Investors

• Following the significant share price rally, investors should assess whether the current valuation fully reflects the new earnings guidance or if the operational momentum justifies further upside.
• Monitor the performance of the specified game titles and TapTap's user metrics in subsequent reports to validate the sustainability of this growth, as these are the core drivers cited for the strong outlook.
• It is crucial to factor in the risk associated with the preliminary nature of these figures; any material negative revision in the final audited results could trigger a price correction.