Analyst Saiyi He from CMB International Securities maintained a Buy rating on NetEase and increased the price target to $160.00 from $136.50.
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Saiyi He has given his Buy rating due to a combination of factors including NetEase’s robust performance and promising outlook. The company’s total revenue for the second quarter of 2025 increased by 9% year-over-year, and its non-GAAP net income rose by 22%, aligning closely with market expectations. Despite a slight shortfall in games revenue growth, the outlook for the second half of 2025 remains strong, with an estimated 13% year-over-year increase, driven by the solid performance of evergreen games and a significant rise in contract liabilities.
Furthermore, NetEase’s gaming segment showed impressive results, with several games achieving top positions on China’s iOS grossing chart following content updates. The company’s non-gaming businesses, such as NetEase Cloud Music and Youdao, also demonstrated quality growth, with improvements in gross profit margins. Additionally, better-than-expected margin expansion, evidenced by improvements in gross and operating profit margins, supports the positive outlook. These factors collectively justify the Buy rating, as NetEase is well-positioned for continued growth and profitability.
He covers the Communication Services sector, focusing on stocks such as Bilibili, NetEase, and Baidu. According to TipRanks, He has an average return of 17.2% and a 62.13% success rate on recommended stocks.
In another report released today, Benchmark Co. also reiterated a Buy rating on the stock with a $145.00 price target.