NetEase Option Alert: Jun 20 $125 Puts at the Bid: 294 vs 0 OI; Earnings 2/20 Before Open 

NetEase Option Alert: Jun 20 $125 Puts at the Bid: 294 @ $26.0 vs 0 OI; Earnings 2/20 Before Open Ref=$102.55

NetEase (NASDAQ:NTES) 주식

NetEase

Founded in the late 1990s as an internet portal, NetEase has transformed into a leading force in the second-largest online game company gaming in China. While its initial success was built upon the massively multiplayer online role-playing game Fantasy Westward Journey, NetEase has expanded its portfolio with captivating franchises that resonate with both domestic and international players. Over the past decade, the company has created titles such as Justice, Identity V, Naraka: Bladepoint, and Eggy Party, all of which maintain significant player bases today. Beyond in-house development, the company also collaborates with likes of Microsoft and Marvel to create and publish games based on renowned IPs, including World of Warcraft, Diablo Immortal, and Marvel Rivals.

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이들 10개 대형주는 지난주 최고의 성과를 거두었다. 그것들이 당신의 포트폴리오에 있나요? 1. 마이크로스트레티지(NASDAQ:MSTR)의 주식은 비트코인(CRYPTO:BTC) 가격의 급등으로 인해 지난 주 25.97% 상승했다.

쇼피파이, 디즈니 및 코인베이스는 지난주 최고 성과를 보여준 10개 대형주 중 일부 (11월 11일-15일)

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미국에 상장된 중국 기업들의 주가는 약세로 인해 지난주 상승폭을 잃었다. 중국은 투자자들의 경기 부양 기대에 미치지 못해 2주 연속 상승세를 보인 후 하락세를 보인 것으로 알려졌다.

리 오토, 테슬라 및 니오는 지난주 최악의 성과를 보인 11개 대형주 중 일부 (10월 7일 - 10월 11일)

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이들 8개 대형주는 지난주 최악의 성과를 거두었다. 그것들이 당신의 포트폴리오에 있나요? 탐보란 리소시스(NYSE:TBN)의 주식은 지난주 13.84% 하락했다.

스노우플레이크 및 JD닷컴은 지난주 최악의 성과를 보인 8개 대형주 중 일부 (8월 18일-8월 24일)

NetEase, Inc. - American Depositary Shares, each representing 5 ordinary shares

NetEase Inc

The possibility of a U.S.-China decoupling could lead to a massive $2.5 trillion sell-off, according to a recent analysis by Goldman Sachs. 
What Happened: The report suggests that in an extreme scenario, investors from both countries might be forced to divest their holdings of equities and debt instruments. If a decoupling takes place, U.S. investors may be forced to offload nearly $800 billion worth of Chinese stocks listed on American exchanges. On the flip side, China could divest its holdings of U.S. Treasuries and equities, which currently total around $1.3 trillion and $370 billion, respectively, as per a report by the <a href="https://www.scmp.com/business/china-business/article/3306443/us-china-decoupling-could-cost-us25-trillion-extreme-goldman-warns">South China Morning Post</a>. 
Amid the risk of U.S.-China decoupling due to the trade war, the possibility of delisting Chinese companies from US stock exchanges is now being explored. This potential move could affect nearly 300 firms, including some of China&#8217;s biggest tech giants, stated Goldman Sachs. 
The sell-off was driven by the assumption that U.S. investors would face restrictions from US regulations on such investments, as per Goldman.
The investment banking firm anticipates a fresh wave of U.S.-listed Chinese companies to relist in Hong Kong. "We believe potential Hong Kong listing for these companies could probably catalyse a re-rating given the flexibility for U.S. investors to convert their ADRs to Hong Kong shares" event of a sudden liquidity crisis, says Goldman Sachs.
James Wang, head of China strategy at UBS Investment Bank Research, noted that the delisting of Chinese companies from the U.S. could have far-reaching consequences, such as diminished access to the deeper U.S. capital markets, potentially lower valuation multiples due to a shrinking investor base, and reduced liquidity.
Why It Matters: The potential decoupling and subsequent delisting of Chinese companies from U.S. exchanges is a growing concern, especially after Treasury Secretary Scott Bessent stated that the delisting of U.S.-listed Chinese companies was once again being considered. During an interview with Fox Business, Bessent stated, "Everything is on the table," when asked about possible actions against Chinese companies. 
According to the U.S.-China Economic and Security Review Commission, as of March 7, a total of 286 mainland Chinese companies were listed on the New York Stock Exchange, NYSE American, and Nasdaq, with a combined market capitalization of $1.1 trillion. 
The Hang Seng Tech Index, which lost over $350 billion in market value since March of that year, is under the shadow of geopolitical tensions and <a href="https://www.benzinga.com/markets/25/04/44761071/are-chinese-tech-stocks-at-a-serious-risk-amid-escalating-trade-war-delisting-is-moving-up-in-the-list-of-retaliatory-options-says-analyst">potential U.S. sanctions</a>. These measures, including restrictions on financial holdings or additional sanctions, represent a &#8220;serious risk,&#8221; as stated by Bush Chu, an investment manager at Aberdeen Investments.
The ADR of Alibaba Group Holding Ltd (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/BABA#NYSE">BABA</a>) climbed 3.4% to close at $107.73 on Friday, while that of PDD Holdings Inc. (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/PDD#NASDAQ">PDD</a>) rose 2.43% to close at $90.50. Meanwhile, ADR of NetEase, Inc. (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/NTES#NASDAQ">NTES</a>) rose 5.36% to close at $99.35, as per <a href="https://www.benzinga.com/pro/">BenzingaPro</a>. 
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<li>READ MORE: <a href="https://benzinga.com/general/health-care/25/04/44783620/speaker-mike-johnson-says-us-must-eliminate-people-on-medicaid-who-are-not-actually-eligible-" target="_blank" rel="noreferrer noopener">Speaker Mike Johnson Says Government Must &#8216;Eliminate People On Medicaid&#8217; Who Are &#8216;Not Actually Eligible To Be There&#8217;</a></li>
</ul>
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Disclaimer:&nbsp;This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.

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Goldman Sachs Warns $2.5 Trillion Sell-Off In The Extreme Event Of US-China Decoupling As Scott Bessent Says 'Everything Is On The Table'

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Shares of Chinese stocks are trading higher. Chinese stocks may be volatile amid the escalation of US-china trade tensions.

U.S. stock futures were lower this morning, with the Dow futures falling more than 700 points on Monday.
Shares of Tesla, Inc. (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/TSLA#NASDAQ">TSLA</a>) fell sharply in today's <a href="https://www.benzinga.com/quote/TSLA">pre-market trading</a>.
Shares of auto-related stocks traded lower as global markets continue to decline following President Trump&#8217;s announcement of sweeping tariffs, which could raise auto prices and affect consumer demand. Additionally, auto part tariffs could raise prices for producers.
Tesla shares dipped 7.1% to $222.45 in the pre-market trading session.
Here are some other stocks moving lower in pre-market trading.
<ul>
<li>American Rebel Holdings, Inc. (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/AREB#NASDAQ">AREB</a>) shares dipped 30.3% to $13.54 in pre-market trading after jumping 392% on Friday. The company, on Friday, announced up to $11 million private placement priced at-the-market under Nasdaq rules.</li>
<li>CECO Environmental Corp. (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/CECO#NASDAQ">CECO</a>) shares fell 29.3% to $14.00 in pre-market trading.</li>
<li>SandRidge Energy, Inc. (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/SD#NYSE">SD</a>) shares tumbled 26.3% to $7.10 in pre-market trading after dipping 9% on Friday.</li>
<li>Stevanato Group S.p.A. (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/STVN#NYSE">STVN</a>) dipped 15.8% to $16.01 in pre-market trading.</li>
<li>PLDT Inc. (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/PHI#NYSE">PHI</a>) shares declined 14.7% to $18.10 in pre-market trading following a 4% decline on Friday.</li>
<li>First National Corporation (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/FXNC#NASDAQ">FXNC</a>) slipped 13.8% to $17.11 in pre-market trading.</li>
<li>Smith Douglas Homes Corp. (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/SDHC#NYSE">SDHC</a>) declined 13% to $17.01 in pre-market trading after gaining 5% on Friday.</li>
<li>Robinhood Markets, Inc. (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/HOOD#NASDAQ">HOOD</a>) dipped 11% to $30.73 in pre-market trading amid decline in Bitcoin prices.</li>
<li>NetEase, Inc. (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/NTES#NASDAQ">NTES</a>) fell 9.7% to $89.27 in pre-market trading.</li>
<li>USCB Financial Holdings, Inc. (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/USCB#NASDAQ">USCB</a>) dipped 7.1% to $15.79 in pre-market trading. USCB Financial Holdings will report financial results for the quarter ended March 31, after the market closes on Thursday, April 24.</li>
<li>NVIDIA Corporation (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/NVDA#NASDAQ">NVDA</a>) fell 6.1% to $88.55 in pre-market trading after dipping over 7% on Friday.</li>
<li>Apple Inc. (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/AAPL#NASDAQ">AAPL</a>) fell 3.8% to $181.21 in pre-market trading after dipping over 6% on Friday.</li>
</ul>
Now Read This: 
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<li><a href="https://www.benzinga.com/25/04/44663650/top-3-defensive-stocks-that-are-preparing-to-pump-this-month-2">Top 3 Defensive Stocks That Are Preparing To Pump This Month</a> </li>
</ul>
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Tesla, Apple, Nvidia And Other Big Stocks Moving Lower In Monday's Pre-Market Session

NetEase's (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/NTES#NYSE">NTES</a>) short percent of float has fallen 17.5% since its last report. The company recently reported that it has 3.49 million shares sold short, which is 0.99% of all regular shares that are available for trading. Based on its trading volume, it would take traders 2.9 days to cover their short positions on average.
<h3>Why Short Interest Matters</h3>
Short interest is the number of shares that have been sold short but have not yet been covered or closed out. <a href="https://www.benzinga.com/money/how-to-short-a-stock?adType=benzinga-insights&amp;ad=short-interest&amp;campaign=wallstreetadvantage">Short selling</a> is when a trader sells shares of a company they do not own, with the hope that the price will fall. Traders make money from short selling if the price of the stock falls and they lose if it rises.
Short interest is important to track because it can act as an indicator of market sentiment towards a particular stock. An increase in short interest can signal that investors have become more bearish, while a decrease in short interest can signal they have become more bullish.
See Also: <a href="https://www.benzinga.com/short-interest?adType=benzinga-insights&amp;ad=short-interest&amp;campaign=wallstreetadvantage">List of the most shorted stocks</a>
<h3>NetEase Short Interest Graph (3 Months)</h3>
<img src="https://www.benzinga.com/files/images/story/2025/1740761138_0.png" alt="short_fig" />
As you can see from the chart above the percentage of shares that are sold short for NetEase has declined since its last report. This does not mean that the stock is going to rise in the near-term but traders should be aware that less shares are being shorted.
<h3>Comparing NetEase's Short Interest Against Its Peers</h3>
Peer comparison is a popular technique amongst analysts and investors for gauging how well a company is performing. A company's peer is another company that has similar characteristics to it, such as industry, size, age, and financial structure. You can find a company's peer group by reading its 10-K, proxy filing, or by doing your own similarity analysis.
According to <a href="https://www.benzinga.com/pro/">Benzinga Pro</a>, NetEase's peer group average for short interest as a percentage of float is 3.23%, which means the company has less short interest than most of its peers.
Did you know that increasing short interest can actually be bullish for a stock? <a href="https://www.benzinga.com/money/how-to-make-money-on-a-short-squeeze?adType=benzinga-insights&amp;ad=short-interest&amp;campaign=wallstreetadvantage">This post by Benzinga Money explains how you can profit from it.</a>
This article was generated by Benzinga's automated content engine and was reviewed by an editor.

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Peering Into NetEase's Recent Short Interest

<figure class="wp-block-image size-full"><img loading="lazy" decoding="async" width="900" height="600" src="https://contributor-assets.benzinga.com/wp-content/uploads/2025/02/25061542/Youdao-0225.jpeg" alt="" class="wp-image-6487" srcset="https://contributor-assets.benzinga.com/wp-content/uploads/2025/02/25061542/Youdao-0225.jpeg 900w,https://contributor-assets.benzinga.com/wp-content/uploads/2025/02/25061542/Youdao-0225-300x200.jpeg 300w,https://contributor-assets.benzinga.com/wp-content/uploads/2025/02/25061542/Youdao-0225-768x512.jpeg 768w" sizes="(max-width: 900px) 100vw, 900px" /></figure>
The education company's marketing services revenue flatlined in the final quarter of last year, following strong double-digit gains in the first three quarters

<h4 class="wp-block-heading">Key Takeaways:</h4>
<ul>
<li>Youdao's revenue began contracting in the fourth quarter, falling 9.5% year-on-year, as its fast-growing marketing services suddenly flatlined</li>
<li>The company aims to revive growth in its market services via an enhanced partnership with parent NetEase and more global sales, as its older education business shrinks</li>
</ul>
Education may be valuable, but advertising is even more so.
That's the big lesson learned over the last two years by&nbsp;Youdao Inc.&nbsp;(DAO.US), the education arm of gaming giant NetEase (XHKG:<a class="ticker" href="https://www.benzinga.com/stock/9999#XHKG">9999</a>), whose&nbsp;<a href="https://www.prnewswire.com/news-releases/youdao-reports-fourth-quarter-and-fiscal-year-2024-unaudited-financial-results-302381231.html">latest quarterly results</a>&nbsp;show how marketing services could soon become the company's main breadwinner.
Among other things, the results showed Youdao posted its first-ever annual profit, ending years of losses since its New York listing six years ago. But that milestone was overshadowed by a few more worrisome signals, led by a sharp slowdown in the company's marketing services that were previously a fast-rising star. That came as Youdao's original core learning services also continued to show steep declines, causing its overall revenue to start contracting.
The company tried to ease concerns with discussion of a couple of new initiatives to jumpstart the marketing services business, which we'll detail shortly. Like many other Chinese tech companies, it also talked copiously about AI, noting it had already incorporated DeepSeek into many of its products.
"We are launching our AI Native strategy integrating AI more comprehensively across our business lines by, for example, automating our advertising platforms and introducing AI-driven tutoring for our course customers," noted Youdao CEO Zhou Feng on Youdao's earnings call, which included more than 30 references to AI by various company officials.
Despite its words of reassurance on reviving marketing services and greater use of AI, investors weren't convinced. Youdao's shares fell 6.8% in the two trading days since the results were announced last Friday.
Here, we should point out that this sell-off comes after a remarkable run-up that saw Youdao's shares nearly triple over the last six months, including a 40% jump this year alone. At its latest close of $9.68, the shares now trade at a four-year high, lifted by both the company's own relatively strong performance and a broader wave of bullishness towards overseas-listed Chinese stocks.
Against that backdrop, the latest two-day sell-off looks a bit like profit taking, and the next few weeks will provide a better picture of whether its rally can continue. Even at the latest levels, the stock still trades 43% below its IPO price of $17 during headier days for Chinese stocks when the company first listed in 2019.
That said, we'll take a deeper dive into Youdao's latest results to see what's happening inside this company that's part of NetEase, one of China's earliest internet companies that has also become one of its most successful gaming operators. Online learning was Youdao's original main breadwinner, but it has been scaling back that part of the business following a government crackdown that outlawed after-school tutoring services in core curriculum areas for K-12 students in 2021 and 2022.
The company's marketing services division was picking up most of the slack for its falling education business to keep overall revenue rising in the first three quarters of last year, though the growth rate was slowing throughout the year. That growth spurt ended in the fourth quarter, however, when Youdao's overall revenue fell by 9.5% to 1.3 billion yuan ($179 million) from 1.5 billion yuan in the same quarter a year earlier.
<h4 class="wp-block-heading">Marketing services flatline</h4>
Within the company's broader revenue pie, learning services fell 21.2% to 618 million yuan, accounting for 48% of total revenue. That part of the business accounted for about two-thirds of the company's revenue as recently as 2022, but has been shrinking rapidly since then and fell to less than half in last year's second quarter.
"Since the summer we have proactively focused on courses and services with strong demand and maintained a rational approach to customer acquisition," said CEO Zhou, explaining the reasons behind the rapid declines. "This strategy has enhanced our overall health."
Such a shift looked acceptable when the company's marketing services were posting strong growth, including a 46% year-on-year rise in the third quarter and a doubling in the first half of last year. The shift to advertising services also looked like a shrewd move strategically since such services are far less likely to fall victim to future government crackdowns than the far more sensitive education sector.
But Youdao's marketing services revenue suddenly flatlined in last year's fourth quarter, rising just slightly to 482 million yuan from 474 million yuan a year earlier, accounting for 37% of total revenue in the latest quarter. The company didn't provide a detailed explanation for the slowdown, though we should note that overall advertising spending has been sluggish in China lately due to the uncertain business climate.
Instead, Youdao executives focused on a couple of new initiatives that they hope will jumpstart growth in that part of its business. The one with the most near-term potential will probably come from an enhanced relationship with NetEase offering more services across its parent's large array of internet assets, including not only games but also music and its popular email service. To do that, Youdao and NetEase formed a formal marketing services partnership last year. That relationship now accounts for less than 10% of its advertising revenue, and CEO Zhou said "we expect this to grow considerably in 2025."
The other initiative comes from expanding its marketing services outside China. The company has been doing that through a relationship with TikTok and recently signed a new deal with Google to further that effort. Youdao President Jin Lei noted that international advertising revenue more than doubled last year to about 100 million yuan, accounting for more than one-fifth of the marketing services total.
In valuation terms, Youdao trades at a price-to-sales (P/S) ratio of 1.57, which looks relatively low compared to some of its peers. The much larger&nbsp;New Oriental&nbsp;(EDU.US; 9901.HK) trades higher with a P/S ratio of 1.8, and&nbsp;TAL Education&nbsp;(TAL.US) is even stronger with a ratio of 4.28. That suggests Youdao's stock could still have some upside potential even after the recent big run-up. But first it will need to quickly halt its revenue declines by jump-starting its marketing services.

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Youdao Looks To Parent, Global Markets To Revive Stalling Growth

Barclays analyst Jiong Shao maintains NetEase (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/NTES#NASDAQ">NTES</a>) with a Equal-Weight and raises the price target from $82 to $104.

Price Target

Analyst Ratings

Barclays Maintains Equal-Weight on NetEase, Raises Price Target to $104

Shares of Youdao Inc (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/DAO#NYSE">DAO</a>) fell slightly following the company's fourth-quarter results, mainly on profit-taking with the stock having <a href="https://www.benzinga.com/quote/DAO">climbed almost 45% over the past month</a>.
The results came amid an <a href="https://www.benzinga.com/earnings">exciting earnings season</a>. Here's a deep dive into Youdao's financial release.
Analyst Ratings For Youdao
The company is known for its online platform that focuses on providing learning tools and services. Powered by AI, the platform has been developed by internet services company NetEase, Inc. (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/NTES#NASDAQ">NTES</a>).
Morgan Stanley, Jefferies and Citigroup have a Buy rating on Youdao. Check out <a href="https://www.benzinga.com/analyst-ratings/analyst-color">other analyst stock ratings</a>.
Youdao: Highlights Of Financial Release
For the fourth quarter, Youdao reported net revenues of RMB 1.3 billion ($180 million), down 9.5% year-on-year. Management indicated that the top-line contraction was mainly due to a decline in revenues from learning services.
Despite the decline in revenues, profitability improved in the quarter. Income from operations reached RMB 84.2 million ($11.6 million), representing 10.3% year-on-year growth.
The Chinese company reported earnings of 70 cents per share for the fourth quarter, significantly beating the consensus estimate of 54 cents per share by 30.6%.
For the full year, net revenues reached RMB 5.6 billion ($770 million), up 4.4% year-on-year. Income from operations reached RMB 148.8 million ($20.51 million), compared to a loss of RMB 466.3 million ($64.26 million) in 2023.
Management said that Youdao Lingshi, the service that provides online learning courses, improved customer loyalty in the fourth quarter. Backed by Youdao Lingshi's AI-powered tiered learning videos and learning counseling, retention rates surpassing 70% in the fourth quarter, marking a year-over-year improvement of over 5 percentage points.
The company also indicated that the transition from larger to smaller classes had driven an over 20% year-on-year increase in gross billings in the fourth quarter.
Youdao Desktop Translation won the "Best Online Education App Award" at the Microsoft Store 2024 Annual App Awards.
Youdao Leverages DeepSeek
On February 6, Youdao announced the full deployment of DeepSeek-R1 in its learning apps, courses, ad platforms and hardware devices.
Mr. P AI Tutor, Youdao's popular tool that provides deeper insights into learning materials, is being powered by DeepSeek-R1 to offer "a faster, more responsive, and cost-efficient service," the company said in a statement.
Mr. P AI Tutor is available in several languages. The company said that the "long reasoning chains offered by DeepSeek-R1" has helped Mr. P AI Tutor to improve its personalized Q&amp;A capabilities, "providing deeper and more accurate solutions and significantly upgrading the user experience." The company plans to launch Mr. P AI Tutor 2.0 in the near term.
DeepSeek's advanced reasoning capabilities are fully deployed in other products, like SpaceOne.
Youdao has also introduced the&nbsp;SpaceOne full-screen tutoring device, an AI-powered learning tool designed for students and professionals.
"We believe that large AI models should serve not merely as additional features, but as autonomous agents that drive outcomes," CEO Feng Zhou said during the earnings call. He added that Youdao plans to launch an "AI Native" strategy, which involves "leveraging AI as a foundational layer across our business lines."
DAO Price Action: Shares of Youdao had declined by 1.25% to close at $10.26 on Friday.
Photo: Shutterstock

Earnings

Earnings Beats

Youdao Turns Profitable In 2024, Leveraging DeepSeek To Upgrade User Experience In Learning

Benchmark analyst Fawne Jiang maintains NetEase (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/NTES#NASDAQ">NTES</a>) with a Buy and raises the price target from $105 to $115.

Benchmark Maintains Buy on NetEase, Raises Price Target to $115

On Thursday, NetEase, Inc (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/NTES#NASDAQ">NTES</a>) reported a fiscal fourth-quarter revenue decline of 1.4% year-on-year to $3.66 billion (26.7&nbsp;billion Chinese yuan), missing the&nbsp;<a target="_blank" href="https://www.benzinga.com/pressreleases/25/02/n43840713/netease-announces-fourth-quarter-and-fiscal-year-2024-unaudited-financial-results" rel="noreferrer noopener">analyst consensus estimate of $3.74 billion</a>.
The Chinese gaming&nbsp;player's&nbsp;adjusted EPADS of $2.07 beat the&nbsp;<a target="_blank" href="https://www.benzinga.com/calendars/earnings" rel="noreferrer noopener">analyst consensus estimate of $1.77</a>. The stock fell after the report.
Also Read: <a target="_blank" href="https://www.benzinga.com/25/02/43812289/wix-q4-earnings-beats-estimates-raises-2025-outlook-ai-powered-expansion-and-market-share-gains" rel="noreferrer noopener">Wix Q4 Earnings: EPS Beat, Issues Strong 2025 Outlook With Two Products Launch</a>
Segments and margins: Games and related value-added services revenues rose 1.5%&nbsp;year over year&nbsp;to $2.9 billion.&nbsp;The corresponding gross margin decreased by 280 bps to 67.5%, mainly attributable to higher revenue contributions from licensed games, which have comparatively lower gross profit margins.
Youdao,&nbsp;Inc.'s (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/DAO#NYSE">DAO</a>) revenue declined by 9.5%&nbsp;year over year&nbsp;to $183.6 million,&nbsp;and&nbsp;the corresponding gross margin declined by 210 bps to 47.8%, primarily due to decreased net revenues from its&nbsp;learning services.
Cloud&nbsp;Music's&nbsp;revenues were $257.6 million, down 5.3% year over year, and its gross margin expanded by 160 bps to 31.9%, mainly due to increased net revenues from sales of membership subscriptions and continued improvement in cost control measures.
Innovative businesses and other revenue declined 17.0%&nbsp;year over year&nbsp;to $313.1 million, and the gross margin increased by 340 bps to 37.8%, mainly due to increased gross profit margins from Yanxuan.
As&nbsp;of December 31, 2024, NetEase held $18.0 billion in cash and equivalents and generated $1.78 billion in operating cash flow.
Dividend:&nbsp;The board of directors approved a dividend of&nbsp;$1.22025&nbsp;per ADS for the fourth quarter of 2024 versus $0.4350&nbsp;per ADS for the third quarter.
NetEase confirmed the laying off of the U.S.-based developers working on&nbsp;Marvel Rivals, the Verge <a target="_blank" href="https://www.theverge.com/news/615288/marvel-rivals-layoffs-netease-overseas-investments" rel="noreferrer noopener">cites</a> the company. However, the development of&nbsp;Rivals&nbsp;would continue with a core group of developers based in China.
Price Action: NTES stock is down 5.91% at $98.01 at&nbsp;the last check on Thursday.
Also Read:
<ul>
<li><a href="https://www.benzinga.com/25/02/43812509/garmin-q4-earnings-wearables-and-adventure-watches-drive-growth-raises-dividend-20-projects-68-billion-revenue-for-2025" target="_blank" rel="noreferrer noopener">Garmin Q4 Earnings: Wearables and Adventure Watches Drive Growth, 20% Dividend Hike, Stock Soars</a></li>
</ul>
Photo via Shutterstock

Dividends

Media

NetEase Q4 Earnings: Revenue Miss, Gaming and Cost Controls Drive Margins, Boosts Dividend

NetEase shares are trading lower after the company reported worse-than-expected Q4 revenue results.

The board of directors approved a dividend of US$0.24405 per share (US$1.22025 per ADS) for the fourth quarter of 2024 to holders of ordinary shares and holders of ADSs as of the close of business on March 6, 2025, Beijing/Hong Kong Time and New York Time, respectively, payable in U.S. dollars.
NetEase paid a dividend of US$0.0870&nbsp;per share (US$0.4350 per ADS) for the third quarter of 2024 in December 2024.

NetEase Board Approved A Dividend Of $1.22025/ADS For Q4 Vs $0.4350/ADS For Q3

NetEase Q4 Adj EPADS $2.07 Beats $1.77 Estimate, Sales $3.66B Miss $3.74B Estimate

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Earnings Scheduled For February 20, 2025

5 analysts have expressed a variety of opinions on NetEase (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/NTES#NASDAQ">NTES</a>) over the past quarter, offering a diverse set of opinions from bullish to bearish.
The following table summarizes their recent ratings, shedding light on the changing sentiments within the past 30 days and comparing them to the preceding months.
<table>
<thead>
<tr>
<th></th>
<th align="right">Bullish</th>
<th align="right">Somewhat Bullish</th>
<th align="right">Indifferent</th>
<th align="right">Somewhat Bearish</th>
<th align="right">Bearish</th>
</tr>
</thead>
<tbody>
<tr>
<td>Total Ratings</td>
<td align="right">3</td>
<td align="right">2</td>
<td align="right">0</td>
<td align="right">0</td>
<td align="right">0</td>
</tr>
<tr>
<td>Last 30D</td>
<td align="right">0</td>
<td align="right">1</td>
<td align="right">0</td>
<td align="right">0</td>
<td align="right">0</td>
</tr>
<tr>
<td>1M Ago</td>
<td align="right">1</td>
<td align="right">0</td>
<td align="right">0</td>
<td align="right">0</td>
<td align="right">0</td>
</tr>
<tr>
<td>2M Ago</td>
<td align="right">0</td>
<td align="right">1</td>
<td align="right">0</td>
<td align="right">0</td>
<td align="right">0</td>
</tr>
<tr>
<td>3M Ago</td>
<td align="right">2</td>
<td align="right">0</td>
<td align="right">0</td>
<td align="right">0</td>
<td align="right">0</td>
</tr>
</tbody>
</table>
Insights from analysts' 12-month price targets are revealed, presenting an average target of $113.4, a high estimate of $122.00, and a low estimate of $105.00. This upward trend is apparent, with the current average reflecting a 3.85% increase from the previous average price target of $109.20.
<img src="https://www.benzinga.com/files/images/story/2025/1739394077_0.png" alt="price target chart" />
<h2>Investigating Analyst Ratings: An Elaborate Study</h2>
A comprehensive examination of how financial experts perceive NetEase is derived from recent analyst actions. The following is a detailed summary of key analysts, their recent evaluations, and adjustments to ratings and price targets.
<table>
<thead>
<tr>
<th>Analyst</th>
<th>Analyst Firm</th>
<th>Action Taken</th>
<th>Rating</th>
<th>Current Price Target</th>
<th>Prior Price Target</th>
</tr>
</thead>
<tbody>
<tr>
<td>Alex Poon</td>
<td>Morgan Stanley</td>
<td>Raises</td>
<td>Overweight</td>
<td>$117.00</td>
<td>$108.00</td>
</tr>
<tr>
<td>Eddie Leung</td>
<td>B of A Securities</td>
<td>Raises</td>
<td>Buy</td>
<td>$122.00</td>
<td>$120.00</td>
</tr>
<tr>
<td>Alex Poon</td>
<td>Morgan Stanley</td>
<td>Raises</td>
<td>Overweight</td>
<td>$108.00</td>
<td>$90.00</td>
</tr>
<tr>
<td>Alicia Yap</td>
<td>Citigroup</td>
<td>Raises</td>
<td>Buy</td>
<td>$115.00</td>
<td>$108.00</td>
</tr>
<tr>
<td>Fawne Jiang</td>
<td>Benchmark</td>
<td>Lowers</td>
<td>Buy</td>
<td>$105.00</td>
<td>$120.00</td>
</tr>
</tbody>
</table>
<h3>Key Insights:</h3>
<ul>
<li>Action Taken: Analysts frequently update their recommendations based on evolving market conditions and company performance. Whether they 'Maintain', 'Raise' or 'Lower' their stance, it reflects their reaction to recent developments related to NetEase. This information provides a snapshot of how analysts perceive the current state of the company.</li>
<li>Rating: Delving into assessments, analysts assign qualitative values, from 'Outperform' to 'Underperform'. These ratings communicate expectations for the relative performance of NetEase compared to the broader market.</li>
<li>Price Targets: Delving into movements, analysts provide estimates for the future value of NetEase's stock. This analysis reveals shifts in analysts' expectations over time.</li>
</ul>
Analyzing these analyst evaluations alongside relevant financial metrics can provide a comprehensive view of NetEase's market position. Stay informed and make data-driven decisions with the assistance of our Ratings Table.
<a href="https://www.benzinga.com/quote/NTES/analyst-ratings?utm_source=Benzinga Insights">Stay up to date on NetEase analyst ratings.</a>
<h2>Delving into NetEase's Background</h2>
NetEase, which started on an internet portal service in 1997, is a leading online services provider in China. Its key services include online/mobile games, cloud music, media, advertising, email, live streaming, online education, and e-commerce. The company develops and operates some of the China's most popular PC client and mobile games, and it partners with global leading game developers, such as Blizzard Entertainment and Mojang (a Microsoft subsidiary).
<h3>Financial Insights: NetEase</h3>
Market Capitalization Analysis: With an elevated market capitalization, the company stands out above industry averages, showcasing substantial size and market acknowledgment.
Revenue Growth: NetEase's revenue growth over a period of 3 months has faced challenges. As of 30 September, 2024, the company experienced a revenue decline of approximately -3.89%. This indicates a decrease in the company's top-line earnings. As compared to its peers, the revenue growth lags behind its industry peers. The company achieved a growth rate lower than the average among peers in Communication Services sector.
Net Margin: NetEase's net margin excels beyond industry benchmarks, reaching 24.95%. This signifies efficient cost management and strong financial health.
Return on Equity (ROE): NetEase's ROE stands out, surpassing industry averages. With an impressive ROE of 4.97%, the company demonstrates effective use of equity capital and strong financial performance.
Return on Assets (ROA): The company's ROA is a standout performer, exceeding industry averages. With an impressive ROA of 3.55%, the company showcases effective utilization of assets.
Debt Management: The company maintains a balanced debt approach with a debt-to-equity ratio below industry norms, standing at 0.08.
<h2>Analyst Ratings: Simplified</h2>
Benzinga tracks 150 analyst firms and reports on their stock expectations. Analysts typically arrive at their conclusions by predicting how much money a company will make in the future, usually the upcoming five years, and how risky or predictable that company's revenue streams are.
Analysts attend company conference calls and meetings, research company financial statements, and communicate with insiders to publish their ratings on stocks. Analysts typically rate each stock once per quarter or whenever the company has a major update.
In addition to their assessments, some analysts extend their insights by offering predictions for key metrics such as earnings, revenue, and growth estimates. This supplementary information provides further guidance for traders. It is crucial to recognize that, despite their specialization, analysts are human and can only provide forecasts based on their beliefs.
Breaking: Wall Street's Next Big Mover
Benzinga's #1 analyst just identified a stock poised for explosive growth. This under-the-radar company could surge 200%+ as major market shifts unfold. <a href="https://www.benzinga.com/premium/ideas/turning-point-trader-checkout-2/?t=Tu1tu3arja3be22tu36&amp;utm_source=benzinga-insights">Click here for urgent details</a>.
This article was generated by Benzinga's automated content engine and reviewed by an editor.

The Analyst Verdict: NetEase In The Eyes Of 5 Experts

NetEase shares are trading higher after Morgan Stanley raised its price target from $108 to $117.

Morgan Stanley analyst Alex Poon maintains NetEase (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/NTES#NASDAQ">NTES</a>) with a Overweight and raises the price target from $108 to $117.

Morgan Stanley Maintains Overweight on NetEase, Raises Price Target to $117

QFIN

Shares of US-listed Chinese stocks are trading higher amid China's efforts to  get insurers to invest in stocks and support markets.

Sony Group Corp&#8217;s (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/SONY#NYSE">SONY</a>) PlayStation <a target="_blank" href="https://www.benzinga.com/topic/gaming-industry" rel="noreferrer noopener">dumped two unannounced</a> live service projects at Syphon Filter&nbsp;and&nbsp;Days Gone&nbsp;developer Bend Studio and God of War&nbsp;game developer Bluepoint Games after a strategic review, Bloomberg <a target="_blank" href="https://www.bloomberg.com/news/articles/2025-01-16/sony-cancels-two-more-playstation-projects?srnd=phx-technology&amp;sref=TBDibEcD" rel="noreferrer noopener">reports</a>.
PlayStation is currently discussing with the studios how to determine their following projects.
PlayStation remains aggressively invested in live-service games, which can be monetized months and years after their launch.
Also Read: <a target="_blank" href="https://www.benzinga.com/25/01/43010198/netflixs-avod-surge-and-wwe-content-fuel-optimism-analyst-sets-1000-price-forecast" rel="noreferrer noopener">WWE, Squid Game Fuel Netflix Ad-Supported Growth: Analyst Sets $1,000 Price Forecast</a>
Sony&#8217;s strategy bore it a hit in 2024&#8217;s&nbsp;Helldivers II&nbsp;and several flops, including&nbsp;Concord, prompting it to cancel several live-service games over the last few years, including one based on Spider-Man.
Sony sold <a target="_blank" href="https://www.benzinga.com/news/earnings/24/11/41841647/sonys-q2-profit-surges-on-gaming-and-sensor-gains-but-ps5-sales-decline-raises-full-year-outlook" rel="noreferrer noopener">3.8 million PlayStation5 units</a> in the fiscal second quarter of 2024, compared to&nbsp;4.9 million a year ago. Sony&#8217;s Game &amp; Network Services revenue rose 12%&nbsp;to 1.07 trillion Japanese yen (on top of consolidated sales&nbsp;of ¥2.91 trillion), and operating income grew 184%&nbsp;to&nbsp;¥138.8 billion.
The video game industry battled challenges in the last two years, including losing <a target="_blank" href="https://www.benzinga.com/markets/equities/24/09/40829756/microsoft-cuts-650-xbox-jobs-amid-restructuring-following-activision-blizzard-deal-report" rel="noreferrer noopener">thousands of jobs</a>. Notable gaming studio closures included Netlix Inc&#8217;s (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/NFLX#NASDAQ">NFLX</a>) <a target="_blank" href="https://www.benzinga.com/general/gaming/24/10/41462659/netflix-ends-aaa-game-development-at-california-studio" rel="noreferrer noopener">Southern California AAA</a> game studio, Team Blue, Take-Two Interactive Software Inc&#8217;s (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/TTWO#NASDAQ">TTWO</a>) <a target="_blank" href="https://www.benzinga.com/news/24/05/38583285/grand-theft-auto-parent-shuts-two-iconic-game-studios-as-part-of-sweeping-layoffs" rel="noreferrer noopener">London&#8217;s Roll7 </a><a target="_blank" href="https://www.benzinga.com/news/24/05/38583285/grand-theft-auto-parent-shuts-two-iconic-game-studios-as-part-of-sweeping-layoffs" rel="noreferrer noopener">and</a> Seattle&#8217;s Intercept Games, Microsoft Corp&#8217;s (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/MSFT#NASDAQ">MSFT</a>) several <a target="_blank" href="https://www.benzinga.com/news/24/05/38732093/microsoft-shakes-up-xbox-division-closes-renowned-studios-in-major-cost-cutting-move" rel="noreferrer noopener">video-game studios</a> within its Xbox division, and NetEase Inc&#8217;s (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/NTES#NASDAQ">NTES</a>) <a target="_blank" href="https://www.benzinga.com/markets/asia/24/08/40659768/netease-to-close-ouka-studios-developer-of-visions-of-mana-report" rel="noreferrer noopener">Ouka Studios</a>.
Reportedly, Krafton Inc. of&nbsp;PUBG: Battlegrounds earmarked over <a target="_blank" href="https://www.benzinga.com/25/01/42954938/pubg-developer-krafton-invests-136-million-in-game-studios-expands-ai-team-for-future-gaming-innovations" rel="noreferrer noopener">200 billion won ($136 million)</a> to over&nbsp;twelve game studios in sync with its artificial intelligence investment.
Over the past two years, Krafton incurred $680 million in investment in game studios. It also tapped Nvidia Corp (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/NVDA#NASDAQ">NVDA</a>) to showcase more lifelike non-player characters in its Inzoi life simulation game.
Elon Musk&#8217;s&nbsp;AI startup,&nbsp;xAI, remains focused on its AI-driven game studio. It is challenging the giant game studios, which, according to the Tesla Inc (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/TSLA#NASDAQ">TSLA</a>) chief, prioritize profit over player engagement and creativity.
Last October,&nbsp;JPMorgan analysts&nbsp;expressed optimism over&nbsp;mobile gaming trends and spending on consoles backed by the gaming pipeline.
Sony Group stock surged over 11% in the last 12 months. Investors can gain exposure to the stock through Avantis International Equity ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/AVDE#NYSE">AVDE</a>) and Invesco International Dividend Achievers ETF (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/PID#NASDAQ">PID</a>).
Price Action: SONY stock traded higher by 1.13% at $20.55 premarket at last check Friday.
Also Read:
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<li><a href="https://www.benzinga.com/general/gaming/24/11/41694104/microsofts-decision-to-shut-down-arkane-austin-called-stupid-by-studio-founder" target="_blank" rel="noreferrer noopener">Microsoft&#8217;s Decision To Shut Down Arkane Austin Called &#8216;Stupid&#8217; By Studio Founder</a></li>
</ul>
Photo via Shutterstock

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Sony Cancels Two Live-Service Games, Stays Committed to Long-Term Monetization

B of A Securities analyst Eddie Leung maintains NetEase (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/NTES#NASDAQ">NTES</a>) with a Buy and raises the price target from $120 to $122.

B of A Securities Maintains Buy on NetEase, Raises Price Target to $122

NetEase shares are trading higher after Morgan Stanley upgraded the stock from Equal-Weight to Overweight and raised its price target from $90 to $108.

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Youdao Dictionary Pen Unveils at CES 2025, Showcasing Cutting-Edge AI Innovations and Applications in Education

Youdao to Report Fourth Quarter and Fiscal Year 2024 Financial Results on February 20

NetEase to Report Fourth Quarter and Fiscal Year 2024 Financial Results on February 20

NetEase Cloud Music Inc. to Report Fiscal Year 2024 Financial Results on February 20, 2025

Youdao Reports Fourth Quarter and Fiscal Year 2024 Unaudited Financial Results

NetEase Announces Fourth Quarter and Fiscal Year 2024 Unaudited Financial Results

NetEase Cloud Music Inc. Reports Fiscal Year 2024 Financial Results

NetEase, Inc. Announces Filing of Annual Report on Form 20-F for Fiscal Year 2024

Youdao Filed 2024 Annual Report on Form 20-F

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