The animated film Ne Zha 2 was released in China on Jan 29, Chinese New Year. It had grossed 7.81 billion yuan ($1.08 billion) in box office revenue as of Sunday morning on an $80 million budget. That makes it the highest-grossing film of 2025 so far, the highest-grossing film in China, and the highest-grossing non-English language film of all time.

The movie, which is loosely based on the novel Fengshen Yanyi (Investiture of the Gods), a 16th-century Chinese novel that is one of the major vernacular Chinese works in the gods and demons genre, conflates the traditional Chinese cultural values of filial piety, friendship, loyalty and patriotism with the modern values of justice, freedom, responsibility and self-awakening.

The filmmakers have done a good job in using modern digital technology to enliven the fairy tale with martial arts, using thrilling visual effects to attract audiences and encourage them to empathize with Ne Zha.

Some Chinese movie critics have said the film is a visual feast of Oriental aesthetics, proving that Chinese animated films have shaken off the label of "childish". Some claim that it has used the combination of "technology + culture" to tear open the cracks in Hollywood's monopoly.

According to the producer of the film, the film uses distributed cloud rendering technology to enable seamless collaboration among 27 animation studios across the country.

Because animated films can better tap into the potential of new technologies to attract audiences, investors are increasingly enthusiastic about animated films, and the money originally used to pay stars can be effectively used to improve the look of a film with costly visual effects and on promotion.

That explains why the proportion of animated films in film and television initial public offerings in China has jumped from 3 percent in 2015 to 19 percent in 2023. The capital market has begun to vote for Chinese "Pixar Animation Studios" with real money.

Ne Zha 2's success is also supported by the film's precision promotion on social media that specifically targeted the parents born in the 1970s and 1980s, who used to watch Ne Zha cartoons during their childhood, prompting them to bring their children to the cinema to enjoy their childhood hero together.

Despite this, it should be pointed out the record box office revenue of Ne Zha 2 also stems from the fact that the domestic audience had fewer choices during the Spring Festival holiday season this year than previous years, and the film ticket price has surged markedly than before.

With the influx of capital to the animated film sector, a worrying trend has emerged of the gold rushers excessively relying on the domestic market, special visual effects, commercial promotion, and ancient Chinese stories. That means some future Chinese animations might just stumble where Ne Zha 2 succeeded if they go too far in copying the aspects that have made the movie so successful refusing to seek to tell better modern Chinese stories in animation forms that can appeal to the world audience in the competitive international market.