NetEase, Inc.: Strong Margin Could Be Here to Stay

研报英文原文证据摘录

NetEase, Inc.: Strong Margin Could Be Here to Stay

Equity Research

China Technology

26 May 2026

NetEase, Inc.

Strong Margin Could Be Here to

Stay Earnings Review

Domestic title successes drove the co. to reach a record NTES EQUAL WEIGHT

gaming segment gross margin, while cost savings further Unchanged

pushed the beat on the bottom line... China Technology UnchangedPOSITIVE

Price Target USD 132.00

NTES reported better-than-expected results especially on margins. The company reported Unchanged

total revenue of RMB 30.6bn, +4% vs. our estimate, while gross margin came in at 69%, +450bps Price (22-May-26) USD 116.55

vs. our estimate. Both top line and margin beat was driven by the gaming segment as domestic Potential Upside/Downside +13.3%

PC titles such as FWJ PC and Where Winds Meet PC saw robust growth and shifted revenue mix. Source: Bloomberg, Barclays Research

FWJ's peak concurrent users hit a new high of 3.9mn the title recorded its highest-ever quarterly

revenue in 1Q26 thanks to the success of the unlimited server. And mgt. noted Where Winds Market Cap (USD mn) 74373

Meet (domestic PC) received a strong boost after its success global release. In 1Q, NTES pushed Shares Outstanding (mn) 638.13

v1.6 content update and the first major major expansion pack to its global players which Free Float (%) N/A

propelled the game to No.2 on Steam's global top seller chart and a 78% positive rating on 52 Wk Avg Daily Volume (mn) 0.8

Steam, and reaching another record quarterly revenue. The success of these two titles drove up Dividend Yield (%) 2.47

sector margin as domestic PC titles' revenue share % is one of the lowest for the Return on Equity TTM (%) 22.12

company (global game revenue share close to 30%), coupled with channel fee savings, margin Current BVPS (USD) 257.53