On May 22, NetEase rose 3.02% overnight, trading at 117.79 USD/share, with trading volume of approximately $344,600. The rebound followed the company's Q1 earnings release, which delivered results broadly exceeding market expectations.
NetEase reported Q1 net revenue of RMB 30.6 billion, up 6.1% year-over-year, surpassing the consensus estimate of RMB 29.51 billion. Gaming and related value-added services revenue reached RMB 25.7 billion, up 6.9% YoY, beating expectations by approximately RMB 1 billion. Gross profit rose 14.8% to RMB 21.2 billion, with gross margin climbing to 69%, a multi-year high. Non-GAAP net profit attributable to shareholders came in at RMB 11.3 billion. The company cited contributions from titles including theErta Fantasy series andErta Cloud Sixteen Voices as key growth drivers.
The overnight recovery partially reversed the prior session's 4.43% regular-trading decline, which was driven by pre-earnings anxiety over projected EPS contraction of approximately 13.68%. CICC maintained its Outperform rating on NetEase with a target price of HKD 265, implying significant upside from current levels.
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