If the recession is global, try telling that to die-hard gamers in China.
Online gaming pioneer Shanda Interactive
Earnings grew by a more modest 25%, but on a per-share basis rose 35% to $0.78 per ADS (American depositary share); Wall Street's expectations were a profit of $0.74 a share on $155.7 million in revenue.
This doesn't mean that the company, based in Shanghai, is necessarily immune to the worldwide weakness. The monthly revenue per account fell 12% from the previous quarter. The company made up for it in volume, posting top- and bottom-line gains over the fourth quarter. It continues to attract a larger pool of players. However, let's hope that the spending blip is simply a matter of Chinese gamers trying to save a little money, instead of a larger trend away from online gaming.
The months of January, February, and March were tough on most companies at the mercy of disposable income. Online gaming in China held up well. Rivals Perfect World
Shanda still has a few investors scratching their heads over its plans to spin off the Cayman Islands-based operator of its online gaming business. It made sense when diversified new media darling Sohu.com
However, it's hard to dismiss Shanda's growth during what was a rough quarter for most sectors. Well played, Shanda.
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Longtime Fool contributor Rick Munarriz has been a fan of China's high-margin gaming stocks for a long time. He is also part of the Rule Breakers newsletter research team, seeking out tomorrow's ultimate growth stocks a day early. He does not own shares in any of the companies in this story. The Fool has a disclosure policy.