NetEase Posts Increased Profit Despite Revenue Decline

NetEase reports Q4 profits rising to $1.2B, but revenue dips. Earnings per share improve, indicating resilience despite challenges.

Date: 20-02-2025

AI Rating: 6

Earnings Per Share (EPS): NetEase reported a significant increase in earnings per share, with adjusted earnings coming in at $0.42 or $2.09 per ADS for Q4 2024, compared to $0.32 or $1.57 per ADS in the prior year. This reflects a positive trend in profitability despite the challenges faced in revenue generation.

Revenue Growth: The company experienced a decline in revenues of 1.4%, reporting RMB26.7 billion ($3.7 billion) for the fourth quarter, down from RMB27.1 billion the previous year. Additionally, revenues from Youdao and NetEase Cloud Music also showed declines year over year, which could raise concerns regarding overall growth potential.

Net Income: Net income attributable to the company increased significantly to RMB8.8 billion ($1.2 billion) for Q4, compared to RMB6.6 billion for the same quarter last year. This positive growth in net income highlights strong profitability improvements.

Conclusion: While NetEase shows a strong performance on the profit side, the revenue decline could spark concerns among investors regarding future growth potential. The increase in earnings per share presents a favorable outlook amidst the current challenges.

Stocks: NTES