NetEase, Inc.


SKU: NTES Category:


NetEase delivered a mixed set of results in the quarter, with revenues well below expectations, but managed an earnings beat. The company’s overall net revenues and net income attributable to shareholders increased. NetEase’s long-running franchises continue to be well-liked by its users. Revenues from the Fantasy Westward Journey Saga continued to increase year over year in the quarter, again impressing the industry with this IP’s enduring appeal. In spite of operating for close to 20 years, the Westward Journey franchise recently celebrated its 21st anniversary since its commercial launch. Games and related value-added services sector had a gross profit margin of 67.4%. For Youdao, their gross profit margin was 47% as opposed to 42.8% during the previous year. The growth was primarily brought on by higher revenue contributions from its higher-margin online marketing and learning services. In the second quarter, Cloud Music’s GP margin increased significantly because of the growth of membership services and ongoing cost-cutting initiatives. Furthermore, NetEase launched T-Minus Zero Entertainment, a novel game studio situated in Austin, Texas. The studio represents the most recent addition to NetEase Games’ portfolio.

Our Report Structure:

⦁ Company Overview
⦁ Investment Thesis
⦁ Key Drivers
⦁ Historical Quarterly Statement Analysis – Income Statement & Cash Flows
⦁ Historical Quarterly Balance Sheet Analysis
⦁ Historical Annual Financial Statement Analysis
⦁ Analysis Of Key Financial Ratios
⦁ Financial Forecasts For 3 Years
⦁ Forecasting The Capital Structure & Net Debt
⦁ Discounted Cash Flow Valuation
⦁ Trading Multiples
⦁ Key Risks
⦁ Disclosures

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