The information provided on EL7.AI is for educational and informational purposes only and does not constitute financial advice.
The information provided on EL7.AI is for educational and informational purposes only and does not constitute financial advice.
| Factor | Score | Distribution | Value | Avg | Rank |
|---|---|---|---|---|---|
Valuation | 88 | 15.1x | 20.8x | Top tier | |
Growth | 56 | 6.6% | 6.1% | Around median | |
Quality | 92 | 27.0% | 6.6% | Top tier | |
Safety | 92 | — | 0.7x | Top tier | |
Capital Return | 23 | 0.53% | 2.02% | Bottom tier | |
Momentum | 32 | -10.0% | 4.1% | Bottom tier | |
Sentiment | 60 | 12 | 3 | Around median |
Estimates — analyst targets and a simplified DCF, not investment advice.
Ten ratios that matter, each compared against its sector median and average — so you can see whether a number is rich or cheap relative to peers in the same sector.
NetEase, Inc. is a Chinese digital internet and entertainment company listed on NASDAQ under the ticker NTES, with businesses centered on online games and related value-added services, along with additional activities in Youdao, NetEase Cloud Music, and innovative businesses such as Yanxuan. Its revenue model relies primarily on operating online games, live services, seasonal content, and in-game expansions, in addition to subscriptions and AI-supported education services, performance-based advertising, digital music, and selective e-commerce. In fiscal 2025, the company generated revenue of $16.1 billion, gross profit of $10.4 billion, and net income of $5.0 billion, compared with revenue of $14.4 billion and net income of $4.1 billion in 2024, reflecting clear annual expansion in sales and profitability.
In the first quarter of fiscal 2026, NetEase reported net revenue of RMB 30.6 billion, up 6% year over year, driven by continued strength in the games segment. Revenue from games and related value-added services reached RMB 25.7 billion, or about 84% of total quarterly revenue, and rose 7% year over year, while online games revenue alone reached RMB 25.1 billion, up 18% quarter over quarter and 7% year over year. Youdao generated revenue of RMB 1.3 billion, up 4% year over year, while NetEase Cloud Music recorded revenue of RMB 2.0 billion, down 7% year over year, and revenue from innovative businesses and other activities reached RMB 1.5 billion, down 5% year over year.
Quarterly profitability improved notably, as the gross margin rose to 69.4% from 54.1% in the corresponding period of the prior year, with a 74.8% margin in games and value-added services versus 68.8% previously, supported by lower platform-related revenue-sharing costs. Operating expenses reached RMB 8.6 billion, or 28% of revenue, including 11.2% for marketing and sales and 14.7% for research and development, showing continued investment in content and innovation. Non-GAAP net income attributable to shareholders also reached RMB 11.3 billion, and liquidity remained strong with a net cash position of RMB 167.2 billion on March 31, 2026, compared with RMB 153.5 billion at the end of 2025.
NetEase’s market capitalization is about $85.4 billion, while the data does not show a valid earnings multiple, so the stock’s valuation becomes more dependent on the trajectory of earnings, margins, and gaming momentum than on traditional multiples. Analyst consensus is rated at Buy, and the average price target is $154.25, with the highest target at $169 and the lowest target at $132; because the live price changes and is displayed outside this text, the stock’s position above or below this target should be read through the updated automated comparison. The 52-week range between $106.06 and $159.55 shows that the stock has moved within a wide range, and that its current valuation should be linked to the company’s ability to maintain a gross margin near 69.4% and execute launches such as Ananta and the planned new titles.
Figures in the text are as of 2026-07-09; the live price is shown at the top of the page.
The biggest factor was the games and related value-added services segment, which generated RMB 25.7 billion in the first quarter of 2026, up 7% year over year. This segment represented about 84% of total revenue of RMB 30.6 billion, making it the central driver of the company’s growth. Its gross margin also rose to 74.8% from 68.8% in the corresponding period, an improvement that management linked to lower revenue-sharing costs with platforms.
Where Winds Meet is important because it demonstrates NetEase’s ability to turn a Chinese-themed game into a broad global product. After its overseas launch in November, the company released a major expansion in March and then version 1.6, pushing the game to second place on Steam’s global top-sellers list. Management also said the game maintained a positive rating of about 78% on Steam during its first six months, and that it plans to improve cross-device compatibility, expand to additional platforms, and deepen localization.
Yes, management discussed titles under development, including a game targeting a third-quarter launch window after a technical test in February and a subsequent test named down breaker. Management also focused on Ananta, describing it as an urban open-world game that differs from traditional RPGs or action games with a familiar style. The core idea in Ananta is for the player to feel as if they are living inside a virtual city through shopping, social interaction, exploration, and business management, rather than having the product rely only on combat or visual presentation.
Automated analysis for informational purposes only — not investment advice.
In the first quarter of 2026, the overall gross margin rose to 69.4% compared with 54.1% in the same period of the prior year, a significant improvement in revenue quality. Non-GAAP net income attributable to shareholders reached RMB 11.3 billion, and the company described this level as roughly stable year over year. On a fiscal-year basis, net income rose to $5.0 billion in 2025 compared with $4.1 billion in 2024, while annual revenue increased to $16.1 billion.
NetEase ended the first quarter of 2026 with a net cash position of RMB 167.2 billion on March 31, compared with RMB 153.5 billion at the end of 2025. The board approved a cash dividend for the first quarter of $0.44 per share, according to the dividend policy cited by the company. The company had also repurchased shares under a $5 billion repurchase program, with the cumulative cost of purchases reaching about $3.1 billion through March 31, 2026.
The main risk is the high concentration in games, because the games and related services segment produced RMB 25.7 billion of the RMB 30.6 billion in first-quarter 2026 revenue. Some non-core businesses also showed weakness, as NetEase Cloud Music revenue fell 7% year over year to RMB 2.0 billion and revenue from innovative businesses and other activities declined 5% year over year to RMB 1.5 billion. In addition, insider data shows net sales of $1.3 million over three months, with one sale transaction on June 29, 2026, and no recorded purchases.