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Segment Information | 12 Months Ended
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Dec. 31, 2020
Segment Information |
Segment Information |
26. | Segment Information
(a) | Description of segments
Operating segments are defined as components of an enterprise about which separate financial information is available that is evaluated regularly by the chief operating decision maker (“CODM”), or decision making group, in deciding how to allocate resources and in assessing performance. The Group’s CODM is the Chief Executive Officer. The Group’s organizational structure is based on a number of factors that the CODM uses to evaluate, view and run its business operations which include, but are not limited to, customer base, homogeneity of products and technology. The Group’s operating segments are based on this organizational structure and information reviewed by the Group’s CODM to evaluate the operating segment results. Effective in the third quarter of 2019, the Group changed its segment disclosure to add the financial results of its certain advertising services and Yanxuan into innovative businesses and others. In addition, the Group has commenced separately reporting the results of Youdao, which completed its initial public offering and listing on the New York Stock Exchange in October 2019. As a result, the Group now reports segments as online game services, Youdao and innovative businesses and others. This change in segment reporting aligns with the manner in which the Group’s CODM currently receives and uses financial information to allocate resources and evaluate the performance of reporting segments. This change in segment presentation does not affect consolidated balance sheets, consolidated statements of operations and comprehensive income or consolidated statements of cash flows. The Group retrospectively revised prior year segment information, to conform to current year presentation.
(b) | Segment data
The table below provides a summary of the Group’s operating segment results for the years ended December 31, 2018, 2019 and 2020. The Group does not allocate any operating costs or assets to its business segments as the Group’s CODM does not use this information to measure the performance of the operating segments. There was no significant transaction between reportable segments for the years ended December 31, 2018, 2019 and 2020 (in thousands). ​
​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | For the year ended December 31,
​ |  | 2018 |  | 2019 |  | 2020
​ | ​ | RMB | ​ | RMB | ​ | RMB
Net revenues: | ​ | ​ | ​ | ​ | ​ | ​
Online game services |  | 40,190,057 |  | 46,422,640 |  | 54,608,717
Youdao |  | 731,598 |  | 1,304,883 |  | 3,167,515
Innovative businesses and others |  | 10,256,920 |  | 11,513,622 |  | 15,890,901
Total net revenues |  | 51,178,575 |  | 59,241,145 |  | 73,667,133
​ | ​ | ​ | ​ | ​ | ​ | ​
Cost of revenues: | ​ | ​ | ​ | ​ | ​ | ​
Online game services |  | (14,617,656) |  | (16,974,234) |  | (19,847,846)
Youdao |  | (515,133) |  | (934,261) |  | (1,713,229)
Innovative businesses and others |  | (8,699,637) |  | (9,777,350) |  | (13,122,656)
Total cost of revenues |  | (23,832,426) |  | (27,685,845) |  | (34,683,731)
​ | ​ | ​ | ​ | ​ | ​ | ​
Gross profit: | ​ | ​ | ​ | ​ | ​ | ​
Online game services |  | 25,572,401 |  | 29,448,406 |  | 34,760,871
Youdao |  | 216,465 |  | 370,622 |  | 1,454,286
Innovative businesses and others |  | 1,557,283 |  | 1,736,272 |  | 2,768,245
Total gross profit |  | 27,346,149 |  | 31,555,300 |  | 38,983,402
​ The following table set forth the breakdown of net revenues by type of good or service for the years ended December 31, 2018, 2019 and 2020: ​
​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | For the year ended December 31,
​ |  | 2018 |  | 2019 |  | 2020
​ | ​ | RMB | ​ | RMB | ​ | RMB
Online games services |  | 40,190,057 |  | 46,422,640 |  | 54,608,717
Youdao learning services |  | 398,186 | ​ | 699,826 |  | 2,154,669
Advertising services |  | 2,769,337 |  | 2,581,623 |  | 2,653,861
Others |  | 7,820,995 |  | 9,537,056 | ​ | 14,249,886
Total Net revenue |  | 51,178,575 |  | 59,241,145 |  | 73,667,133
​ The following table presents the total depreciation expenses of property and equipment by segment for the years ended December 31, 2018, 2019 and 2020: ​
​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | For the year ended December 31,
​ |  | 2018 |  | 2019 |  | 2020
​ | ​ | RMB | ​ | RMB | ​ | RMB
Online game services |  | 235,896 |  | 256,181 |  | 258,357
Youdao |  | 3,863 |  | 6,076 |  | 7,239
Innovative businesses and others |  | 201,707 |  | 218,850 |  | 208,514
Total depreciation expenses of property and equipment |  | 441,466 |  | 481,107 |  | 474,110
​ As substantially all of the Group’s long-lived assets are located in the PRC and substantially all of the Group’s revenue of reportable segments are derived from China based on the geographical locations where services and products are provided to customers, no geographical information is presented.

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- Definition The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 31 -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8924-108599 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 34 -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8981-108599 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 21 -Subparagraph (a) -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8721-108599 Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 40 -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e9031-108599 Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 32 -Subparagraph (f) -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8933-108599 Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 32 -Subparagraph (e) -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8933-108599 Reference 7: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 26 -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8844-108599 Reference 8: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 41 -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e9038-108599 Reference 9: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 32 -Subparagraph (d) -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8933-108599 Reference 10: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 22 -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8736-108599 Reference 11: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 42 -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e9054-108599 Reference 12: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 15 -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8657-108599 Reference 13: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 21 -Subparagraph (b) -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8721-108599 Reference 14: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -URI http://asc.fasb.org/topic&trid=2134510 + Details
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