Merchandise, small players swept up in whirlwind success of Ne Zha 2

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By Liu Yukun (China Daily) 08:36, February 28, 2025

Workers produce Ne Zha-themed action figures in Xiangtan, Hunan province, on Feb 8. (Photo/Xinhua)

The China-made animated hit Ne Zha 2 exploded onto screens with the force of a "demon child" during Chinese New Year, raking in a staggering 14 billion yuan ($1.9 billion) at the box office.

The unprecedented success of the domestically made film boosted its production company's stock by a jaw-dropping 260 percent in eight trading days, and propelled sales of associated merchandise beyond hundreds of millions of yuan, sending factory operations into overtime to meet the booming demand.

The strong revenue generated by the film has sent a ripple through the entire film industry, showcasing the synergy between profitable intellectual property and the infusion of capital.

From the Sichuan-accented exclamation of Taoist immortal Taiyi Zhenren's "Bashi de ban!" (How delightful!) to the grandeur of the East Sea Dragon Palace, Ne Zha 2 is a daring cultural reimagining.

On-screen, the film's protagonist defiantly declares, "If there's no path ahead, I'll carve one!" Off-screen, a coalition of 138 Chinese animation studios, ranging from industry giants to obscure contributors, united to chart a new path for Chinese animation.

Director Yang Yu, better known as Jiaozi, said that while international companies were initially considered to produce the movie's visual special effects, they fell short of expectations. "We instead opted to entrust local teams with refining the work," he said.

In Jiangxi province, Huanying Fengbao (Miragevfx) studio spent three months crafting the ethereal Yu Xu Palace dome effects, which include intricate circular patterns and mesmerizing nectar water animations. The average age of the young animation team was 25.

In Shenzhen, Guangdong province, Fantawild Animation took the same amount of time to perfect the waterfall effects for a forest skirmish scene. To tackle the intricate scene, the animation team streamlined its workflows, used 50 high-performance workstations as a computational cluster, and conducted batch processing of simulation data.

"Each frame demanded 32 hours for rendering, totaling 15 days. Our aim was not just grandeur, but a rhythmic, aesthetically Eastern cascade," team leader Wang Weiwei said.

In an interview with CCTV, Jiaozi stressed: "We must craft visuals that astonish, that break new ground artistically and captivate aesthetically. Only then does the endeavor hold merit."

Awestruck audiences

This relentless pursuit of technical excellence left Wang Zheng, general manager of Mianyang Zhonghuan Culture Communications, a company that owns 10 cinemas, awestruck.

"Many viewers revisited the film to dissect fleeting visual effect moments," said Wang.

Before many screenings, tickets sold out within minutes. Some impatient international fans even went to nearby countries to watch the film.

In addition, hordes of fans of the movie traveled to real-world Ne Zha landmarks such as Tianjin's Chentang Pass and Yibin's Ne Zha Temple — rekindling interest in cultural tourism.

Zhang Feng from Beijing displayed a clutch of different ticket stubs for the film to illustrate his appreciation for different aspects of Ne Zha 2's high-end production value.

"IMAX 3D for its visual splendor, Dolby Atmos for musical immersion, 4DX for the 'wind-fire wheels' thrill," he said.

At the peak of Ne Zha 2's box office reign, Zhonghuan cinemas scheduled up to 140 daily screenings, Wang said. The off-peak cinema occupancy rate hovered at 50 to 60 percent while prime-time screenings were sold out.

The film accounted for 80 percent of Zhonghuan cinemas' daily box office earnings, he said.

"Our scheduling hinges on demand, occupancy, and revenue — Ne Zha 2 dominated on all fronts," he added.

"Although the average attendance rate for Ne Zha 2 dropped by 50 percent one month after its release, this still stands as a commendable achievement. This data not only reflects remarkably well on the domestic market, but also showcases a favorable decline rate when compared with imported animation films."

Wang said imported animation films often face a situation where, after one month, many theaters have either stopped screening them or only have occasional showings. "In contrast, Ne Zha 2 continues to be prioritized by theaters as a leading feature for screening," he said.

Go local, win global

As audiences wept during the movie's heart-touching scenes, investors rejoiced in its financial fortunes.

Ne Zha 2 boasted five production companies — three affiliated with Enlight Media and two linked to Jiaozi, information from data analysis company Beacon Pro showed.

With a reported budget of 500 million yuan, which included production and marketing, industry insiders estimated that Enlight could reap over 2 billion yuan from a 10 billion yuan box office haul. After Spring Festival, Enlight's shares surged, adding a remarkable 72 billion yuan to achieve a 100 billion-yuan market value.