Qingci Games Inc. provided group earnings guidance for the six months ended June 30, 2022. For the period, the company expects to record a revenue for the Reporting Period ranging from approximately RMB 250 million to RMB 270 million, as compared to the revenue of approximately RMB 763 million for the six months ended June 30, 2021. It is expected that an adjusted net loss ranging from approximately RMB 60 million to RMB 90 million will be recorded, as compared to the adjusted net profit of approximately RMB 313.7 million for the six months ended June 30, 2021.

The expected turnaround from adjusted net profit to adjusted net loss was primarily attributable to the decrease in revenue as the landmark games reached mature stage of their life cycles; marketing expenses incurred from intensive marketing and promotion since the launching of The Marvelous Snail on June 8, 2022 in Japan which is yet to be fully offset by revenue generated during the Reporting Period due to relatively short game duration after launch; and the Group continuing to increase research and development investment for its pipeline games, including the increase in the number of employees engaging in research and development activities and the corresponding increase in employee benefits expenses. Based on the application of International Financial Reporting Standards (‘IFRS'), the Company recorded net loss ranging from approximately RMB 60 million to RMB 90 million during the Reporting Period as compared to a net loss of approximately RMB 93.8 million for the six months ended June 30, 2021. The main reasons for the loss during the Reporting Period were in consistent with the above-mentioned reasons for the adjusted net loss.

In addition, the main factors that led to the loss in the same period last year including changes in fair value of convertible redeemable preference shares; and financial instruments issued to investors, which led to total losses of approximately RMB 392 million for the same period last year were not applicable during the Reporting Period.