VNG (VNZ) Q1 net profit hits record 125B VND since 2022 listing

Overview

VNG Corporation (VNZ: UPCOM) reported a net profit of 125 billion VND in the first quarter of 2025, the highest quarterly profit since the company listed in late 2022. The result breaks a two-quarter loss streak and reflects strong revenue growth of 32% year-on-year to nearly 2,800 billion VND, driven by online games, Zalo, and Zalopay.

Key Facts

• Net profit after tax reached 125 billion VND in Q1 2025, the highest since VNG’s listing in 2022.
• Revenue grew 32% year-on-year to nearly 2,800 billion VND.
• Online games contributed 69% of revenue, or approximately 1,940 billion VND.
• Zalo and AI platforms generated 506 billion VND in revenue.
• Zalopay revenue surged 117% year-on-year to 216 billion VND, aided by tap-to-pay and international QR acceptance in five Asian countries.
• Gross profit was 1,110 billion VND, with a gross margin of 40%, up from 37.5% a year earlier.
• VNG had total assets of over 10,730 billion VND and retained earnings of 740 billion VND as of end-Q1.

What Happened

VNG Corporation reported its Q1 2025 financial results, showing a sharp turnaround from the prior two quarters of losses. CEO Kelly Wong attributed the strong performance to double-digit growth in three of four core business segments, operational discipline, and cost control. The online games segment remained the dominant revenue driver, while Zalopay posted the highest growth rate at 117%, supported by new payment solutions and international QR network expansion.

The company’s gross margin improved to 40% from 37.5% in the same period last year. VNG had previously reported a consolidated loss of 263 billion VND for the full year 2024, marking five consecutive years of losses, though the 2024 loss was only a quarter of the 2023 figure and less than half of management’s initial forecast.

Market Context

VNG shares closed at 314,000 VND on April 10, 2026, down 1.26% on low volume of 600 shares. The stock trades on UPCOM and has been under pressure due to the company’s prolonged loss streak. The Q1 profit beat may signal a turning point, but the market will watch for sustained profitability. The technology sector in Vietnam has seen mixed performance, with investors favoring companies that demonstrate clear paths to profitability.

Strategic Significance

VNG’s return to profitability in Q1 2025 is a critical milestone for the company, which has been investing heavily in expanding its ecosystem beyond online games into messaging (Zalo), payments (Zalopay), and AI solutions. The improved gross margin and cost control suggest that these investments are beginning to yield returns. The strong performance of Zalopay, in particular, positions VNG to capture growth in Vietnam’s digital payment market, which is expanding rapidly. Sustained profitability would support the case for a potential re-rating of VNZ shares.

What to Watch

• Q2 2025 earnings release to confirm whether profitability is sustainable.
• Growth trajectory of Zalopay and its contribution to overall revenue.
• Any updates on VNG’s AI and enterprise solutions segment.
• Changes in foreign ownership limits or investor sentiment toward UPCOM-listed tech stocks.
• Management guidance for full-year 2025 profit and revenue targets.