NetEase (NTES.O): 2Q26 Preview: Likely Inline Result With Inline Gaming Revs

研报英文原文证据摘录

NetEase (NTES.O): 2Q26 Preview: Likely Inline Result With Inline Gaming Revs

Viewpoint |

29 Jul 2026 16:20:49 ET │ 22 pages

NetEase (NTES.O)

2Q26 Preview: Likely Inline Result With Inline Gaming Revs

CITI'S TAKE

We expect NTES to report 2Q26 by mid-to-end Aug and believe results will

likely be inline with our/consensus estimates. We have maintained our

forecast unchanged in this report and model 2Q26 total revs to +6.1% yoy to Buy

Rmb29.6bn and non-GAAP net profit of Rmb9.92bn, driven by resilience Price (29 Jul 26 16:00) US$129.62

performance of existing games portfolio, particularly FWJ franchise. The

Target price US$174.00highly anticipated new game Sea of Remnants launched in July seems to

experience just moderate performance so far and we believe management Expected share price return 34.2%

is likely to retain optimistic view and provide insight into future potential of Expected dividend yield 2.0%

the game traction. Looking ahead, we forecast 3Q26 total revs to reach

Expected total return 36.2%Rmb30.7bn (+8.2% y/y), supported by seasonality and steady performance

of key titles. Our TP is unchanged at US$174. Maintain Buy and expect Market Cap US$82,989M

higher passive flow and Southbound interest to support relatively resilient

share price performance despite lack of catalysts from new games releases.

2Q26 preview – We model 2Q26 total net revs of Rmb29.6bn (+6.1% y/y and -3% Price Performance

q/q) and non-GAAP NP of Rmb9.92bn, vs. Bloomberg consensus of Rmb29.4bn and (RIC: NTES.O, BB: NTES US)

Rmb10.2bn. We model online games revs to +6.4% yoy and -5.7% qoq to

Rmb24.3bn driven by resilient performance of FWJ, rebound of Eggy Party under a

seasonally soft quarter. We model in S&M spend +12% y/y to Rmb4.01bn or 13.6% of

total net revs in 2Q26.