Netease Inc (HK:9999)
:9999
Want to see HK:9999 full AI Analyst Report?
Top Page
Netease Inc
(9999)
Select Model
Select Model
Rating:81Outperform
Price Target:
HK$231.00
▲(26.71% Upside)
Action:Reiterated
Date:05/22/26
High overall score is driven primarily by strong financial quality (high margins, low leverage, and robust free cash flow) and supportive valuation (low P/E with a solid dividend). The latest earnings call reinforced momentum in the core games business and capital returns, while the main drag is weak technical trend (below major moving averages with negative MACD).
Positive Factors
High and improving margins
Sustained high gross and operating margins indicate durable monetization power from digital content and favorable cost structure (lower revenue-sharing). High margins support reinvestment, shareholder returns, and resilience to revenue volatility over the next several quarters.
Negative Factors
High revenue concentration in games
Heavy dependence on gaming revenue concentrates cash flow and profit drivers in a cyclical, hit‑driven industry. Game lifecycle, player engagement and regulatory changes can materially affect results across multiple quarters, limiting diversification options.
Read all positive and negative factors
Positive Factors
Negative Factors
High and improving margins
Sustained high gross and operating margins indicate durable monetization power from digital content and favorable cost structure (lower revenue-sharing). High margins support reinvestment, shareholder returns, and resilience to revenue volatility over the next several quarters.
Read all positive factors
Netease Inc (9999) vs. iShares MSCI Hong Kong ETF (EWH)
Market Cap
HK$594.72B
Dividend Yield2.22%
Average Volume (3M)6.01M
Price to Earnings (P/E)15.4
Beta (1Y)0.81
Revenue Growth8.67%
EPS Growth7.52%
CountryHK
Employees26,028
SectorCommunication Services
Sector Strength97
IndustryElectronic Gaming & Multimedia
Share Statistics
EPS (TTM)10.67
Shares Outstanding3,219,564,700
10 Day Avg. Volume5,642,123
30 Day Avg. Volume6,010,111
Financial Highlights & Ratios
PEG Ratio1.30
Price to Book (P/B)3.84
Price to Sales (P/S)5.46
P/FCF Ratio12.71
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
HK$248.65Price Target Upside36.40% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering20
EPS Forecast (FY)14.97
Revenue Forecast (FY)HK$139.27B
Netease Inc Business Overview & Revenue Model
Company Description
NetEase, Inc. delivers a broad spectrum of online services across the People's Republic of China and internationally, focusing on diverse areas such as content, community engagement, communication, and e-commerce. Its business is structured into f...
How the Company Makes Money
NetEase makes money mainly by monetizing its gaming content and, to a lesser extent, its music and related online services. (1) Online games: This is the company’s primary revenue engine. NetEase generates revenue from in-game purchases (e.g., vir...
Netease Inc Earnings Call Summary
Earnings Call Date:May 21, 2026
(Q1-2026)
| % Change Since: |
Next Earnings Date:Aug 13, 2026
Earnings Call Sentiment Positive
The call highlighted solid top‑line growth led by the games business, meaningful margin improvement, strong cash and shareholder returns, successful global launches and continued investment in new titles and AI. Offsetting these positives were softness in NetEase Cloud Music, meaningful quarter‑over‑quarter declines in the innovative/other segment (driven by e‑commerce and ad weakness), mixed quarterly performance at Youdao, and elevated marketing spend. On balance, operational strength in the core games franchise, improving profitability, strong cash and successful global expansion outweighed the segment weaknesses.Positive Updates
Total Revenue and Revenue Growth
Total net revenue reached RMB 30.6 billion in Q1 2026, representing a 6% year‑over‑year increase, driven primarily by games and related value‑added services.
Negative Updates
NetEase Cloud Music Revenue Decline
NetEase Cloud Music net revenue was RMB 2.0 billion, representing a 7% year‑over‑year decrease (broadly stable quarter‑over‑quarter), indicating weakness in that segment.
Read all updates
Q1-2026 Updates
Positive
Negative
Total Revenue and Revenue Growth
Total net revenue reached RMB 30.6 billion in Q1 2026, representing a 6% year‑over‑year increase, driven primarily by games and related value‑added services.
Read all positive updates
Company Guidance
Management provided forward-looking guidance that the company will continue heavy investment in product quality, global publishing and localization and expects Elements to move into a larger down‑breaker test ahead of a targeted Q3 launch window, while continuing to invest in Where Winds Meet and other global titles to drive long‑term, sustainable growth; this outlook is supported by Q1 metrics including total revenue of RMB 30.6 billion, games and related VAS net revenue of RMB 25.7 billion (online games RMB 25.1 billion, up 18% QoQ and 7% YoY), net cash of RMB 167.2 billion, non‑GAAP net income of RMB 11.3 billion (≈USD 1.6 billion) and non‑GAAP EPS of USD 0.51 per ADS, gross profit margin of 69.4% (game gross margin 74.8%), operating expenses of RMB 8.6 billion (28% of revenue) with R&D at 14.7% and selling & marketing at 11.2% of revenue, an effective tax rate of 18.9%, Q1 dividend approved of USD 0.44 per share, Peak concurrent/active metrics cited such as a new high of 3.9 million Piccart users and franchise totals like 200 million registered users for a long‑running mobile title—signals management’s expectation of continued content‑driven engagement and international expansion.Netease Inc Financial Statement Overview
Summary
Income Statement
88
Very Positive
Balance Sheet
92
Very Positive
Cash Flow
90
Very Positive
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 114.39B | 112.63B | 105.30B | 103.47B | 96.50B | 87.61B |
| Gross Profit | 75.14B | 72.40B | 65.81B | 63.06B | 52.77B | 46.97B |
| EBITDA | 43.94B | 43.07B | 38.14B | 37.11B | 27.11B | 24.38B |
| Net Income | 34.13B | 33.76B | 29.70B | 29.42B | 20.34B | 16.86B |
Balance Sheet | ||||||
| Total Assets | 231.40B | 221.51B | 195.99B | 185.92B | 172.76B | 153.64B |
| Cash, Cash Equivalents and Short-Term Investments | 170.90B | 167.00B | 137.58B | 126.72B | 117.46B | 97.53B |
| Total Debt | 10.96B | 6.39B | 12.82B | 20.48B | 28.46B | 21.69B |
| Total Liabilities | 62.05B | 56.34B | 53.50B | 57.84B | 63.89B | 54.37B |
| Stockholders Equity | 164.72B | 160.36B | 138.69B | 124.29B | 104.73B | 95.33B |
Cash Flow | ||||||
| Free Cash Flow | 50.56B | 48.39B | 38.40B | 31.06B | 25.07B | 21.82B |
| Operating Cash Flow | 52.28B | 49.43B | 39.68B | 35.33B | 27.71B | 24.93B |
| Investing Cash Flow | -28.24B | -32.22B | 17.92B | -17.04B | -7.37B | -7.08B |
| Financing Cash Flow | -13.68B | -19.74B | -27.34B | -21.47B | -10.24B | -12.59B |
Netease Inc Technical Analysis
Negative
182.30
Price Trends
183.71
Positive
184.51
Positive
201.52
Negative
Market Momentum
3.46
Positive
50.80
Neutral
49.81
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HK:9999, the sentiment is Negative. The current price of 182.3 is below the 20-day moving average (MA) of 191.63, below the 50-day MA of 183.71, and below the 200-day MA of 201.52, indicating a neutral trend. The MACD of 3.46 indicates Positive momentum. The RSI at 50.80 is Neutral, neither overbought nor oversold. The STOCH value of 49.81 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for HK:9999.
Netease Inc Risk Analysis
Netease Inc disclosed 94 risk factors in its most recent earnings report. Netease Inc reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Netease Inc Peers Comparison
UnderperformOutperform
Sector (60)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
82 Outperform | HK$3.75B | 6.41 | 17.91% | 3.82% | -4.19% | 0.41% | |
81 Outperform | HK$594.72B | 15.41 | 21.64% | 2.22% | 8.67% | 7.52% | |
70 Outperform | HK$31.39B | 9.57 | 10.86% | 0.48% | -5.54% | 78.73% | |
66 Neutral | HK$56.35B | 53.40 | 8.04% | ― | 11.37% | ― | |
66 Neutral | HK$22.94B | 13.50 | 45.14% | 1.18% | 14.94% | 86.33% | |
60 Neutral | $48.67B | 4.58 | -11.27% | 4.14% | 2.83% | -41.78% | |
48 Neutral | HK$3.86B | 22.00 | 2.70% | 8.76% | -26.02% | -51.13% |
* Communication Services Sector Average
HK:9999
Netease Inc
190.50
-8.86
-4.45%
HK:0799
IGG
3.27
-0.11
-3.14%
HK:3888
Kingsoft
22.48
-16.68
-42.59%
HK:0777
NetDragon Websoft Holdings
7.28
-1.77
-19.53%
HK:9626
Bilibili, Inc. Class Z
135.20
-21.50
-13.72%
HK:2400
XD, Inc.
47.10
1.95
4.32%
Netease Inc Corporate Events
NetEase Posts Higher Q1 2026 Revenue and Profit on Strong Gaming Business
May 21, 2026
NetEase reported unaudited results for the first quarter of 2026, posting net revenues of RMB30.6 billion, up 6.1% year-on-year, driven largely by a 6.9% increase in games and related services and solid growth at Youdao and NetEase Cloud Music. Gr...
NetEase Declares First-Quarter 2026 Cash Dividend for Hong Kong Shareholders
May 21, 2026
NetEase Inc., the Hong Kong-listed Chinese online services and gaming company, has declared an ordinary first-quarter cash dividend of USD 0.144 per share for the financial year ending 31 December 2026. The announcement underscores the group’...
NetEase Files Form 13F Disclosing Over US$100 Million in U.S. Equity Holdings
May 14, 2026
NetEase, Inc. has disclosed that it filed a Form 13F with the U.S. Securities and Exchange Commission for the quarter ended March 31, 2026, in its capacity as an institutional investment manager. The filing indicates that NetEase exercises investm...
NetEase Sets May 26 Record Date for Annual General Meeting Voting Rights
May 8, 2026
NetEase has set May 26, 2026, as the record date for determining which holders of its ordinary shares are eligible to attend and vote at its forthcoming annual general meeting in Hong Kong. Shareholders must ensure their share transfers and relate...
NetEase Sets Date for First-Quarter 2026 Results and Earnings Call
May 7, 2026
NetEase, Inc. has scheduled a board meeting for May 20, 2026, to review and approve its unaudited financial results and quarterly dividend for the first quarter ended March 31, 2026. The company plans to publish its first-quarter 2026 earnings ann...
NetEase files 2025 Form 20-F, reinforcing cross-border disclosure
Apr 15, 2026
NetEase, Inc. has announced that it has filed its annual report on Form 20-F for the fiscal year ended December 31, 2025 with the U.S. Securities and Exchange Commission, satisfying a key U.S. regulatory reporting requirement for foreign private i...
NetEase Relocates Principal Hong Kong Office to New Kowloon Address
Apr 13, 2026
NetEase, Inc. has changed the address of its principal place of business in Hong Kong, effective April 13, 2026, moving to Room 802, 8/F, China Life Centre, Tower A, One HarbourGate, in Kowloon. The relocation formalizes a new Hong Kong office bas...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.