2025-05-15-Jefferies-网易（NTES）_速评网易2025年第一季度业绩_7页_111kb

NetEase (NTES) 1Q25 Equity Research Summary

Quick Take

NetEase reported Q1 2025 results exceeding consensus and estimates, driven by strong online games performance. Revenue from games and related services increased 12.1% YoY, with online games growing 14.8%.

Highlights

• Total net revenue up 7.4% YoY to RMB28.8bn, beating estimates.
• Games & related services revenue rose 12.1% to RMB24bn, with online games contributing 97.5% of segment revenue and growing 14.8% YoY.
• Youdao net revenue declined 6.7% YoY to RMB1.3bn.
• Gross profit increased 8.6% YoY to RMB18.5bn.
• GAAP operating profit surged 37% to RMB10.4bn, and Non-GAAP net income reached RMB11.2bn vs. estimates.

Other Key Points

• Share repurchase of USD1.9bn and dividend declaration of US$0.135 per share.
• Upcoming earnings call topics include competitive landscape, overseas strategies, AI developments, and shareholder returns.
• Buy rating with price target of USD120/HK$188, key risks include game popularity decline and regulatory challenges.

Valuation and Risks

• Rating: Buy. Price Target: USD120.
• Risks: Decline in flagship titles, heavy investments, game license approvals, and overseas market competition.