A Series of Research Insights on Consumption Hotspot Events [1] - "Ne Zha 2": Leading the Upgrade of the Domestic Animation Industry Chain and Market Transformation Amidst Uncertainties

As of 15:00 on February 24, 2025, the cumulative box office of "Ne Zha 2: The Devilish Kid Causes Havoc in the Sea" (hereinafter referred to as "Ne Zha 2") has exceeded 13.515 billion yuan, surpassing "Inside Out 2" to top the global animated film box office list. Behind this achievement is the decade-long accumulation of Chinese animated films, from the "awakening of domestic animation" with "Monkey King: Hero is Back" in 2015, to the "validation of a hit" with "Ne Zha: Birth of the Demon Child", and then to the exploration of diverse themes such as "Chang'an 30,000 Li" and "I Am What I Am".

"Ne Zha 2" is the light of domestic animation supported by the entire industry. The Chinese animation industry has been continuously accumulating strength in the past decade, and finally proved its industrialization strength to the world with an "all-Chinese team" work.

1. Integration of the Entire Industrial Chain: Achieving Technological Upgrade and Cultural Breakthrough

According to public information, there are as many as 138 co-producers of "Ne Zha 2". At the same time, the names of more than 4,000 animators scroll at the end of the film, forming the "Honor Roll of Domestic Animation". But few people ask: Why does an animated film require such a complex collaboration network? The answer lies in a profound supply-side structural reform that the Chinese animation industry is undergoing.

Figure 1: Disassembly of the "Ne Zha 2" Business Model

At the technical level, "Ne Zha 2" demonstrates the strong strength of China's animation industrialization. In the film, the character modeling is detailed down to the hair, and the scene design is meticulously crafted. Even the insignificant minor characters are vivid, and every frame is a visual feast.

This seemingly "impossible task" encountered many difficulties and challenges during the production process. For example, to achieve the special effect of Ne Zha's "Fire Lotus" in the film, the technical team even independently developed a new rendering algorithm in order to reduce the rendering time from 72 hours to 8 hours.

At the cultural level, "Ne Zha 2" is based on traditional myths and skillfully integrates modern values such as "My fate is determined by myself, not by the heaven". It not only retains the unique charm of Eastern aesthetics but also gives new vitality to traditional culture. Through subversive narrative and visual styles, the film has successfully attracted the resonance of young audiences and also made more people interested in domestic animation.

This expression of cultural confidence not only made "Ne Zha 2" a great success in the domestic market but also laid the foundation for the internationalization of Chinese animation.

Of course, the market has also given positive feedback. The performance of "Ne Zha 2" can be described as phenomenal, with the box office soaring all the way and breaking through 10 billion yuan so far. It not only sets a new box office record for global animated films but also occupies an important position in the entire film market. It is worth noting that the film has also attracted a large number of audiences who originally did not pay much attention to domestic animation, achieving a successful "breakthrough".

The market performance of "Ne Zha 2" not only proves the commercial potential of domestic animation but also injects confidence into the entire industry.

The success of "Ne Zha 2" is not only the victory of a film but also a sign of the transformation of the Chinese animation industry from quantitative change to qualitative change. From the initial "small workshop" production to the current industrialized output of the entire industrial chain integration, the rise of domestic animation is not accidental but the result of the combined effect of multiple factors such as technology, culture, and market.

2. The Survival Game Under the Halo: The Coexistence of Commercial Prosperity and Industrial Hidden Pains

However, the rise of domestic animation is never a "fairy tale" of a single-point breakthrough but a "marathon" that requires the collaboration of the entire industrial chain. The success of just one "Ne Zha 2" does not mean that the Chinese animation industry has reached the top of the world. The entire industry is still deeply trapped in the dilemmas of imbalance between input and output, brain drain, and platform dependence.

Figure 2: The Rise Process of Domestic Animation

Although top works like "Ne Zha 2" can achieve profits through box office and derivatives, most small and medium-cost animated films are still struggling on the "survival line". The high production costs and uncertain market returns have deterred many investors, resulting in the abortion of a large number of high-quality projects due to lack of funds. This situation not only limits the diversity of the industry but also makes it difficult for small and medium-sized teams to obtain growth space.

At the same time, the high-intensity work and low salary returns in the animation industry have also made many young people no longer choose to "work for love". The talent gap not only weakens the innovation ability of the industry but also makes Chinese animation face severe challenges of lack of creativity, technological lag, and shrinking market share in the global competition. Therefore, the domestic animation industry needs a "talent revolution".

In addition, whether it is the scheduling of cinemas or the distribution of streaming media, the discourse power of animated film screenings is highly concentrated in the hands of a few platforms. This dependence not only puts the producers in a weak position in business negotiations but also limits the long-tail value development of IP. The pursuit of traffic and short-term interests by the platforms will also make some creators sacrifice the artistic integrity to cater to the market preferences, further intensifying the homogenization competition in the industry.

"Ne Zha 2" surpassing "Inside Out 2" to top the global animated film box office list proves that Chinese animators have the ability to create world-class works, but the real rise of the industry cannot rely on "lone heroes". When capital no longer blindly chases after blockbusters, talents are no longer forced to "work for love", and platforms no longer only focus on traffic, the Chinese animation industry can truly get out of the strange circle of "one masterpiece, ten years of silence". Let's look forward to the next ten years.

Disclaimer

The data in the article are all from public data. We have taken reasonable measures to ensure the reliability and accuracy of the information. However, due to the limitations of the data sources themselves, there may be certain errors or deviations. Moreover, the views, conclusions, and suggestions in this article are for reference only and do not represent any specific investment advice or decision-making basis, nor do they represent the position of SMZDM Technology Group. Any third-party names, brands, or products mentioned in the article are for illustration purposes only and do not constitute an endorsement or recommendation of them.