Follow NetEase to never miss an important update.
The leaders of the US and China are scheduled to meet at the White House this Thursday. They aim to maintain a trade agreement that has kept new tariffs and restrictions at bay, but that deal is currently set to end in November.
For NetEase, a stable relationship between the two countries is helpful for its global plans. The company is currently trying to grow its gaming business outside of China and relies on partnerships with US firms like Blizzard to bring popular titles to Chinese players. Any progress toward a long-term truce reduces the risk of sudden regulations or trade barriers that could disrupt those cross-border deals.
Source: Reuters
Bernstein set its price target at $160 per share. This is roughly in line with the $162 average across all firms that follow the company. Even after a recent drop in the stock price, analysts generally see the business as worth more than its current market value. This target suggests about 30 percent upside from today's price.
Source: Bernstein
NetEase reported quarterly revenue of about 4.4 billion dollars, which was slightly higher than the 4.3 billion dollars analysts expected. However, its earnings per share of $1.77 fell well short of the $2.31 target. The core gaming division, which makes up the vast majority of the business, grew about 7 percent compared to last year.
The profit miss is the main concern here. While the company is successfully growing its sales and its partnership with Blizzard is bringing major titles back to China, it is spending more to get those results. For long-term owners, the focus remains on whether NetEase can keep its older, high-profit games stable while it spends to launch new titles globally.
NetEase is scheduled to report its second-quarter earnings on August 20. Analysts are looking for earnings of about 2.30 dollars per share.
The results will provide a look at how well the company is sustaining its older, high-margin games while integrating its renewed partnership with Blizzard. This partnership brings popular titles like World of Warcraft back to the Chinese market, which is a key part of the company's growth plan.
NetEase Cloud Music, the company's music streaming arm, will release its financial results for the first half of 2026 on August 20. While gaming is the main driver of profit for NetEase, the music division is an important part of its effort to diversify beyond video games.
Source: PRNewsWire
NetEase has missed profit targets in three of the last five quarters. Management is struggling to predict the costs of launching and maintaining its big gaming hits.
| Expectation | |
|---|---|
| EPS | $2.39 |
| Revenue | $4.54B |