Movement Alert|NetEase Rises 3.82% in Pre-Market Trading, Q1 Earnings Beat Expectations as Multiple Brokerages Maintain Buy Ratings

Market Focus
May 26

On May 26, NetEase rose 3.82% in pre-market trading, trading at $120.5/share, with trading volume of approximately $62,700.

On the news front, NetEase previously reported Q1 results that broadly exceeded market expectations, while multiple major brokerages reiterated bullish ratings. Q1 revenue reached RMB 30.6 billion, up 6.1% YoY, beating Bloomberg consensus by approximately 4%. Gaming and related value-added services revenue was RMB 25.7 billion, up 6.9% YoY, driven by strong performance from self-developed titles including theErta Fantasy series andErta Cloud Sixteen Voices. Non-GAAP net profit of RMB 11.3 billion surpassed consensus by 13%, with gross margin improving to 69.4% and gaming gross margin reaching 75%, up 6 percentage points YoY.

Goldman Sachs, CICC, JPMorgan, CMB International, and Nomura all maintained buy or outperform ratings. Goldman Sachs highlighted record-high profit margins and noted prior share price correction was excessive. JPMorgan set a target price of HKD 280. Looking ahead, catalysts include the launch of new game Sea of Oblivion in summer and potential Stock Connect inflows following conversion to primary Hong Kong listing.

(The above content is based on publicly available market information, generated by a program or algorithm, and is intended solely as a stock movement alert. It does not constitute investment advice or a basis for trading decisions.)

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