Ne Zha 2 is driving Chinese box office to hard-to-imagine records, and putting Chinese animation firmly on the global map.
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Summary
The phenomenon that is Ne Zha 2, China’s animated movie that pushes artistic boundaries, has made box office history. Animation comes of age in China, as a marriage of technology and creativity drives Ne Zha 2 to set global box office records and move China past the COVID-19 hangover.
The phenomenon that is Ne Zha 2
The Chinese animated movie Ne Zha 2 has become the first film in history to gross over $1bn in a single market (in this case China), and the domestic box office now stands at $1.69bn (as of 19th Feb 2025) earned locally since its release on 29 January 2025 during the Lunar New Year holiday, one of the key release periods of the year. The Ne Zha world is from a 16th-century novel called The Investiture of the Gods, which has been part of Chinese culture from an early age and is now an ongoing IP.
Impressively, the box office in China alone has taken the film to 8th in the all-time worldwide box office rankings (with further box office to come in China and as it rolls out abroad), putting it ahead of global hits such as Inside Out 2, Deadpool & Wolverine, Barbie, and Top Gun: Maverick. The movie has also become Imax’s highest-grossing release in China, taking $106m in the first three weeks of release, around 6% of its total box office. This means that one film—in a period of 20 days—has already earned over a quarter of the whole Chinese market’s 2024 result; an encouraging sign for the year ahead. For all films, the 2025 box office is around 46% of the full-year 2024 number in the first two months of this year, at $2.7bn. This is one of the first major movies of the post-pandemic moviegoing era, suggesting that this year is one of rebirth, not of continued COVID-19 hangover.
Figure 1: All-time highest-grossing movies in China (¥bn)
Source: Maoyan
The movie is a locally-produced animated title, produced by Enlight Pictures, underscoring the desire for Chinese (and other) audiences to see content produced in their own countries. It also underlines the advances made by Chinese animators since Dreamworks Animation launched a joint venture in 2012 with China Media Capital, Shanghai Media Group, and Shanghai Alliance Investment: Shanghai Oriental DreamWorks Film & Television Technology Co, now known as Pearl Studios.
Once looked down on as children’s content, but with a long history behind it, Chinese animation caught investors’ eyes in 2014 with the release of The Monkey King. The budget for the Ne Zha sequel was around four times the original outing, $80m compared to $20m for the first Ne Zha in 2019. The first movie grossed $743m, a good result but also underlining the phenomenal performance of this latest title. There was also a related film released in 2020, Jiang Ziya, which was set in the same universe. That one grossed $244m globally, nearly all in China.
Given the new film reportedly had 4,000 people working on it across over 100 companies in China, the budget of $80m looks decidedly at the low end, suggesting the use of AI and technology, as well as lower wages, kept the film’s costs down. The sheer number of people working on it could see the movie itself, as well as the content, described as collectivist and inspired by Chinese values.
The movie presents some animation breakthroughs, notably the movement of fluids in line with the actual principles of fluid dynamics, facilitated by technology and high computing power. One of the key components in producing high-quality animation is the quality of the rendering, and this was done by uploading big computing tasks to local cloud computing clusters, for example, the Gui'an Supercomputing Center in Southwest China's Guizhou Province. This center contributed 40% of the computing power required to render the most intricate scenes in Ne Zha 2. The Gui'an Supercomputing Center has played a part in the rendering of over 150 movies and TV series since it was opened in 2020, and shows the way forward for this type of animated content. This level of technology involvement is reminiscent of the first Avatar, which also pushed boundaries back in 2009. However, that movie took 13 years to realize. Technology has moved on and makes complicated work much quicker for creative teams to achieve.
Ne Zha 2 is now rolling out to other countries and looks likely to get a 700-site release in North America, the largest for a long time for a Chinese title. Crouching Tiger, Hidden Dragon started out as a small release in 2001 but grew to over 2,000 sites as word of mouth spread. The final North American gross was $128m, still the highest for a Chinese title. How Ne Zha 2 performs in the world will be a marker in the stated aim of the authorities for the film to be a cultural export and a tool of soft power—an ambition that is so far unfulfilled. Animated content is very popular in China and the world, and it seems that animation could well be the vehicle to achieve this ambition.
Appendix
Further reading
China Cinema Market Update – 2024, David Hancock
“Cinema In China: The Ups and Downs of a rollercoaster ride”, 2025, David Hancock
Author
David Hancock, Chief Analyst, Media & Entertainment
