网易-S(09999) - 2023 - 中期财报

Financial Performance - NetEase reported net revenue of RMB 24.01 billion (USD 3.31 billion) for Q2 2023, a year-over-year increase of 3.7%[3] - Revenue from games and related value-added services was RMB 18.80 billion (USD 2.59 billion), representing a year-over-year increase of 3.6%[3] - Youdao's revenue reached RMB 1.21 billion (USD 166.4 million), showing a significant year-over-year growth of 26.2%[3] - Cloud Music revenue was RMB 1.95 billion (USD 268.7 million), a year-over-year decrease of 11.1%[3] - Gross profit amounted to RMB 14.40 billion (USD 2.00 billion), reflecting a year-over-year increase of 11.1%[3] - Net profit attributable to shareholders was RMB 8.20 billion (USD 1.10 billion), with non-GAAP net profit of RMB 9.00 billion (USD 1.20 billion)[4] - Basic earnings per share were USD 0.35, with non-GAAP basic earnings per share of USD 0.39[4] - The net profit attributable to shareholders in Q2 2023 was RMB 8,242.8 million (USD 1,136.7 million), compared to RMB 6,754.6 million in the previous quarter and RMB 5,291.5 million year-over-year[12] - Net income for the six months ended June 30, 2023, was RMB 14,870,009 thousand, representing a significant increase from RMB 9,412,595 thousand in the same period of 2022, reflecting a growth of approximately 58.8%[22] - The company reported a net profit attributable to shareholders of RMB 14,997,401 thousand for the six months ended June 30, 2023, compared to RMB 9,685,499 thousand in the same period of 2022, which is an increase of about 55.0%[22] Operating Expenses - Total operating expenses in Q2 2023 were RMB 8,312.8 million (USD 1,146.4 million), an increase from RMB 7,676.5 million in the previous quarter and RMB 7,995.2 million year-over-year[9] - The total operating expenses for the six months ended June 30, 2023, were RMB 15,989,215 thousand, compared to RMB 15,324,500 thousand in the same period of 2022, reflecting an increase of approximately 4.3%[22] - The operating costs for the six months ended June 30, 2023, totaled RMB 19,785,629, a decrease from RMB 20,937,050 in the same period of 2022, showing a reduction of 5.5%[24] Cash Flow and Liquidity - As of June 30, 2023, the net cash and cash equivalents amounted to RMB 99.6 billion (USD 13.7 billion), an increase from RMB 95.6 billion at the end of 2022[14] - Cash and cash equivalents at the end of June 30, 2023, totaled RMB 15,679,412, down from RMB 19,552,450 at the end of the previous quarter[23] - The company reported a net cash outflow from investing activities of RMB 5,802,848 for the six months ended June 30, 2023, compared to a net cash outflow of RMB 12,220,918 in the same period last year[23] - The company experienced a net cash inflow from financing activities of RMB 572,429 for the six months ended June 30, 2023, compared to a net cash outflow of RMB 20,325,192 in the same period last year[23] Assets and Liabilities - As of June 30, 2023, the total assets of NetEase amounted to RMB 172.76 billion, a decrease from RMB 167.91 billion as of December 31, 2022, representing a decline of approximately 2.5%[21] - The total liabilities increased significantly to RMB 63.89 billion as of June 30, 2023, compared to RMB 49.64 billion at the end of 2022, marking an increase of about 28.7%[21] - The total equity attributable to NetEase shareholders was RMB 104.73 billion as of June 30, 2023, down from RMB 114.26 billion at the end of 2022, a decrease of approximately 8.3%[21] Margins and Profitability - The gross margin for online games and related value-added services was 67.4%, up from 66.7% in the previous quarter and 64.9% year-over-year[8] - The gross margin for Youdao was 47.0%, down from 51.7% in the previous quarter but up from 42.8% year-over-year, reflecting changes in revenue contributions[8] - The gross margin for Cloud Music was 27.0%, an increase from 22.4% in the previous quarter and 13.0% year-over-year, driven by increased subscription revenue and cost control improvements[8] Strategic Initiatives - The company launched several popular new games in June, enhancing its international presence and expanding its game portfolio[5] - Cloud Music subscription numbers increased significantly, contributing to improved profitability[5] - Youdao's learning services and online marketing services showed strong revenue growth, with improved operating cash flow[5] - The company plans to continue investing in new technologies and market expansion to drive future growth[23] - The company is committed to developing innovative online services and keeping pace with market trends[19] Non-GAAP Metrics - The company emphasizes the importance of non-GAAP financial metrics, such as net profit attributable to shareholders after excluding stock-based compensation[20] - Non-GAAP metrics are used to provide investors with a clearer understanding of operational performance and future prospects[20] - The company acknowledges the limitations of non-GAAP financial indicators, which may not reflect all income/expense items affecting operations[20] Risks and Uncertainties - NetEase's forward-looking statements are subject to various business risks and uncertainties, including market growth and regulatory changes[19] - Economic uncertainties and capital market volatility are potential risks that could impact NetEase's business performance[19] - The company is focused on maintaining its market position in both China and globally amidst competitive pressures[19] ESG and Recognition - NetEase has been recognized for its ESG performance, being included in the 2022 Dow Jones Sustainability World Index and receiving an MSCI rating of A[18]