SEGMENT AND GEOGRAPHIC INFORMATION

12 Months Ended

Dec. 31, 2014

SEGMENT AND GEOGRAPHIC INFORMATION

SEGMENT AND GEOGRAPHIC INFORMATION

15. SEGMENT AND GEOGRAPHIC INFORMATION

        The Group's chief operating decision maker has been identified as the Chief Executive Officer, who reviews consolidated results of operations data by two segments, online business and offline business, when making decisions about allocating resources and assessing performance of the Group. In identifying its reportable segments, the Group also considers the nature of services provided by its operating segments.

        The Group's chief operating decision maker evaluates segment performance based on revenues, cost of revenues and gross profit. Accordingly, all expenses that are considered corporate level activities and are not allocated to segments. Therefore, it is not feasible to show profit or loss by reportable segments. Also, the Group's chief operating decision maker does not assign assets to these segments and no asset information by segment is provided to the chief operating decision maker.

        The Group has two reportable segments: online business and offline business. The online business segment is responsible for developing and operating online virtual worlds, mobile games and applications, as well as other online entertainment services.

        The offline business segment is responsible for licensing the Group's proprietary cartoon figures, producing films and merchandising sales of the Group's cartoon figures.

Year ended December 31, 2012	Online Business		Offline Business		Total
Revenue	$	34,091,925	$	8,188,499	$	42,280,424
Less: sales tax and related taxes		1,922,430		149,760		2,072,190
Net revenue		32,169,495		8,038,739		40,208,234
Less: cost of revenues		6,949,772		3,048,618		9,998,390
Gross profit	$	25,219,723	$	4,990,121	$	30,209,844

Year ended December 31, 2013	Online Business		Offline Business		Total
Revenue	$	37,670,793	$	13,117,356	$	50,788,149
Less: sales tax and related taxes		2,340,641		93,821		2,434,462
Net revenue		35,330,152		13,023,535		48,353,687
Less: cost of revenues		7,643,598		5,620,619		13,264,217
Gross profit	$	27,686,554	$	7,402,916	$	35,089,470

Year ended December 31, 2014	Online Business		Offline Business		Total
Revenue	$	35,277,786	$	8,976,888	$	44,254,674
Less: sales tax and related taxes		1,985,337		80,186		2,065,523
Net revenue		33,292,449		8,896,702		42,189,151
Less: cost of revenues		6,534,883		5,182,265		11,717,148
Gross profit	$	26,757,566	$	3,714,437	$	30,472,003

        The Group generates substantially all of its revenues from customers in the PRC. Substantially all of the Group's long-lived assets are located in the PRC.