Core Viewpoint - NetEase, Inc. reported its unaudited financial results for the fourth quarter and fiscal year ended December 31, 2024, highlighting a strong performance in gaming and related services, despite some declines in specific segments [1]. Financial Highlights - Net revenues for Q4 2024 were RMB 26.7 billion (US$ 3.7 billion), a slight decrease of 1.4% compared to Q4 2023 [7]. - Net revenues from games and related services were RMB 21.2 billion (US$ 2.9 billion), an increase of 1.5% year-over-year [8]. - Gross profit for Q4 2024 was RMB 16.3 billion (US$ 2.2 billion), down 3.3% from the same quarter in 2023 [11]. - Net income attributable to shareholders for Q4 2024 was RMB 8.8 billion (US$ 1.2 billion), compared to RMB 6.6 billion in Q4 2023 [21]. Operational Highlights - The company launched several successful new titles, including "Marvel Rivals," which quickly became a top seller on Steam, and "Where Winds Meet," which achieved over 3 million downloads shortly after launch [13]. - Youdao and NetEase Cloud Music showed healthy development, with Youdao achieving a 10.3% year-over-year increase in operating profit [6][13]. Fiscal Year 2024 Results - Total net revenues for fiscal year 2024 were RMB 105.3 billion (US$ 14.4 billion), up from RMB 103.5 billion in 2023 [23]. - Net revenues from games and related services for the fiscal year were RMB 83.6 billion (US$ 11.5 billion), an increase from RMB 81.6 billion in 2023 [24]. - Net income attributable to shareholders for fiscal year 2024 was RMB 29.7 billion (US$ 4.1 billion), slightly up from RMB 29.4 billion in 2023 [32]. Gross Profit and Margins - Gross profit margin for games and related services in Q4 2024 was 66.7%, down from 69.5% in Q4 2023 [14]. - Gross profit margin for Youdao was 47.8%, a decrease from 49.9% in the same quarter of 2023 [15]. - NetEase Cloud Music's gross profit margin improved to 31.9% year-over-year, attributed to better cost control and increased subscription revenues [16]. Operating Expenses - Total operating expenses for Q4 2024 were RMB 8.5 billion (US$ 1.2 billion), a decrease of 15.1% compared to Q4 2023 [18]. - The reduction in operating expenses was primarily due to lower marketing expenditures related to games [18]. Cash Flow and Dividends - Net cash provided by operating activities for fiscal year 2024 was RMB 39.7 billion (US$ 5.4 billion), an increase from RMB 35.3 billion in 2023 [34]. - The board approved a dividend of US$ 0.24405 per share for Q4 2024, payable in March 2025 [35].

Core Viewpoint - NetEase Cloud Music Inc. will report its financial results for the fiscal year 2024 on February 20, 2025, after the Hong Kong market closes [1] Group 1: Financial Reporting - The earnings conference call is scheduled for 7:00 p.m. Beijing/Hong Kong Time on February 20, 2025 [2] - Participants must register online to receive dial-in numbers, an event passcode, and a personal access PIN for the conference call [2] Group 2: Replay and Webcast Information - A replay of the earnings call will be available until February 27, 2025, with specific phone numbers provided for different regions [3] - A live and archived webcast of the conference call will be accessible on the Company's investor relations website [3] Group 3: Company Overview - NetEase Cloud Music Inc. was launched in 2013 and is recognized as a leading online music platform in China, focusing on user experience and community engagement [4] - The platform is popular among Generation Z in China and emphasizes discovering and promoting emerging musicians [4]

Core Viewpoint - NetEase, Inc. will report its financial results for the fourth quarter and fiscal year 2024 on February 20, 2025, before the U.S. markets open [1] Group 1: Financial Reporting - The earnings teleconference call will occur at 7:00 a.m. Eastern Time on February 20, 2025, with management discussing quarterly results and answering questions [2] - Interested parties can participate in the conference call by dialing 1-914-202-3258 and providing conference ID: 10044895, 15 minutes prior to the call [3] - A replay of the call will be available until February 27, 2025, and will also be webcast live for 12 months on NetEase's Investor Relations website [3] Group 2: Company Overview - NetEase, Inc. is a leading internet and game services provider focused on premium content, with a strong presence in both mobile and PC gaming [4] - The company boasts one of the largest in-house game R&D teams, creating superior gaming experiences and delivering value to its global community [5] - Beyond gaming, NetEase's offerings include Youdao, an intelligent learning company, NetEase Cloud Music, an online music platform, and Yanxuan, a private label consumer lifestyle brand [6]

Investment Rating - The report maintains a "Buy" rating for the company, with a target price raised to $124.00, indicating a potential upside of 24.9% from the current price of $99.31 [2][3][4]. Core Insights - The company is expected to see accelerated growth in PC games and stable performance in mobile games, leading to a double-digit growth in overall gaming revenue for the year [3][8]. - Revenue and profit forecasts for 2025 have been adjusted upwards by 1% and 3% respectively, reflecting better-than-expected performance from new game releases [3][8]. - The anticipated growth in PC games is driven by new titles such as "Marvel's Contest of Champions," which is expected to contribute significantly to revenue [8][9]. Financial Forecasts - The updated revenue projections for 2024E and 2025E are RMB 106,289 million and RMB 116,667 million, respectively, reflecting growth rates of 2.7% and 9.8% [7][9]. - The adjusted net profit for 2025 is projected to be RMB 35,081 million, with a net profit margin of 30.1% [7][9]. - The report highlights a significant increase in the number of players for new games, with "Marvel's Contest of Champions" reaching over 20 million players shortly after launch [8][9]. Market Performance - The company's stock has shown a year-to-date increase of 11.32%, with a 52-week high of $113.14 and a low of $76.28 [6][9]. - The average daily trading volume is reported at 1.91 million shares, indicating active market participation [6][9]. Valuation Metrics - The target price is based on a 17x price-to-earnings ratio for 2025, with an expected adjusted operating profit growth rate of 17% [3][9]. - The report indicates a projected gross profit margin of 62.4% for 2024E, slightly decreasing to 61.4% in 2025E [7][9].

Company Overview - NetEase (NTES) shares increased by 8.2% to close at $103.92, with trading volume significantly higher than usual, compared to a 2.6% gain over the past four weeks [1] Technological Advancements - The optimism surrounding NetEase is largely due to its commitment to technological advancements, particularly in AI-driven subscription services, which have enhanced functionality and user appeal [2] Earnings Expectations - NetEase is expected to report quarterly earnings of $1.76 per share, reflecting a year-over-year increase of 10%, while revenues are projected to be $3.76 billion, a decrease of 1.6% from the previous year [3] Earnings Estimate Revisions - The consensus EPS estimate for NetEase has been revised down by 4.5% over the last 30 days, indicating a negative trend in earnings estimate revisions, which typically does not lead to price appreciation [4] Industry Context - NetEase belongs to the Zacks Internet - Software and Services industry, where another company, RingCentral (RNG), has seen a 2% increase in its stock price, but has returned -16.4% over the past month [4]

Core Viewpoint - NetEase (NTES) has demonstrated strong performance in the gaming and Internet services sector, achieving a 6.6% increase in stock value over the past month, surpassing the industry average of 5.9% and outperforming peers like Red Violet, Criteo, and Globant [1][2]. Group 1: Financial Performance - The strong momentum in online gaming services and significant revenue growth in Q3 2024 contributed to NetEase's outperformance [2]. - In Q3 2024, net revenues from online games constituted approximately 96.8% of the segment's total net revenues, an increase from 96.1% in Q2 and 93.7% year-over-year [3]. - Mobile games accounted for about 70.8% of net revenues from online game operations in Q3 2024, down from 76.4% in Q3 2023 and 77.6% in Q2 2024 [3]. Group 2: Gaming Division Highlights - NetEase's gaming division is thriving, with popular titles experiencing impressive growth; PC games saw net revenues increase by approximately 29% year-over-year and 30% quarter-over-quarter [5]. - Legacy franchises like Fantasy Westward Journey and Westward Journey Online continue to attract players, with a new chapter introduced in Fantasy Westward Journey Mobile [6]. - NARAKA: BLADEPOINT celebrated its third anniversary, enhancing player engagement through new updates [7]. - Justice Mobile is redefining traditional MMOs with innovative features, including AI-driven NPCs and user-generated AI companies [8]. Group 3: Technological Innovations - NetEase is committed to technological advancements, with significant strides in AI-driven subscription services and tools that enhance user engagement [13][15]. - The AI model Ziyue achieved over 4 million users in its debut quarter, setting a new industry standard [11]. - Youdao Literature has launched AI-powered writing enhancement tools, leading to increased user engagement [12]. Group 4: International Expansion and Future Prospects - NetEase is expanding its international gaming footprint, with Justice Mobile set to launch in Hong Kong, Macau, and Taiwan, and Dunk City Dynasty on track for a global release [14]. - The company is intensifying its game pipeline with plans to unveil several highly anticipated titles in the coming months [14].

Core Insights - The articles emphasize the importance of maintaining a public track record of successful investment ideas and encourage discussions among readers [1][2] - The author has a director-level position in Accounting/Finance and has been investing for five years, achieving a cumulative return of +20% CAGR with a focus on low-risk investments [1] - The investment strategy involves generating alpha through a limited number of well-researched ideas, highlighting the significance of discipline and patience in investing [1] Company and Industry Summary - The author expresses a beneficial long position in NTES shares, indicating a personal investment interest in the company [3] - The articles clarify that no financial advice is provided, and the views expressed may not reflect those of Seeking Alpha as a whole, emphasizing the independent nature of the analysis [4]

Core Viewpoint - NetEase (NTES) has received an upgrade to a Zacks Rank 1 (Strong Buy), indicating a positive outlook for its stock based on rising earnings estimates [1][2]. Earnings Estimates and Stock Price Movement - The Zacks rating system emphasizes the importance of changing earnings estimates, which are strongly correlated with near-term stock price movements [3][5]. - Institutional investors often rely on earnings estimates to determine the fair value of stocks, leading to significant price movements based on their buying or selling actions [3]. Business Improvement Indicators - The upgrade in NetEase's rating reflects an improvement in the company's underlying business, suggesting that investors may respond positively by driving the stock price higher [4][10]. - Analysts have raised their earnings estimates for NetEase, with the Zacks Consensus Estimate for the fiscal year ending December 2024 projected at $7.08 per share, representing a year-over-year change of 0.3% [7]. Zacks Rank System Overview - The Zacks Rank system classifies stocks into five groups based on earnings estimates, with Zacks Rank 1 stocks historically generating an average annual return of +25% since 1988 [6]. - Only the top 5% of Zacks-covered stocks receive a 'Strong Buy' rating, indicating superior earnings estimate revisions and potential for market-beating returns [8][9].

Group 1: NetEase (NTES) - NetEase is an Internet technology company in China, focusing on the development of applications, services, and technologies for the Internet, with a Zacks Rank of 1 (Strong Buy) [1] - The Zacks Consensus Estimate for NetEase's current year earnings has increased by 4.1% over the last 60 days [1] - NetEase's shares have gained 16.4% over the last three months, outperforming the S&P 500's gain of 2.5%, and the company has a Momentum Score of A [2] Group 2: Photronics (PLAB) - Photronics is a leading worldwide manufacturer of photomasks, holding a Zacks Rank of 1 [2] - The Zacks Consensus Estimate for Photronics' current year earnings has increased by 4.6% over the last 60 days [2] - Photronics' shares have gained 6.6% over the last three months, also outperforming the S&P 500's gain of 2.5%, and the company has a Momentum Score of A [2] Group 3: SEI Investments (SEIC) - SEI Investments is an asset management company providing wealth management business solutions in the financial services industry, with a Zacks Rank of 1 [3] - The Zacks Consensus Estimate for SEI Investments' current year earnings has increased by 3.8% over the last 60 days [3] - SEI Investments' shares have gained 18.6% over the last three months, significantly outperforming the S&P 500's gain of 2.5%, and the company has a Momentum Score of B [3]

Group 1: ZIM Integrated Shipping Services - ZIM Integrated Shipping Services is a global container liner shipping company providing container shipping and related services in Israel and internationally [1] - The Zacks Consensus Estimate for ZIM's current year earnings has increased by 35.7% over the last 60 days [1] - The company has a dividend yield of 5.8%, which is higher than the industry average of 3.6% [2] Group 2: NetEase - NetEase is an Internet technology company engaged in the development of applications, services, and other technologies for the Internet in China [2] - The Zacks Consensus Estimate for NetEase's current year earnings has increased by nearly 4.1% over the last 60 days [2] - The company has a dividend yield of 1.8%, compared to the industry average of 0.0% [3] Group 3: West Bancorporation - West Bancorporation focuses on providing community-oriented personal and commercial banking services to small and medium-sized businesses, individuals, schools, organizations, and local government [3] - The Zacks Consensus Estimate for West Bancorporation's current year earnings has increased by nearly 7.7% over the last 60 days [3] - The company has a dividend yield of 4.3%, which is higher than the industry average of 2.9% [4]