NetEase's second-quarter earnings showed EPS below expectations, while revenue exceeded forecasts and the share price rose temporarily. Analysts subsequently updated their forecast models.
NetEase reported second-quarter earnings per share of ¥2.17, significantly below market expectations, while revenue reached approximately ¥300 billion, slightly exceeding forecasts. After the earnings release, the share price rose approximately 4.3% and ended trading near HK$202.
Analysts updated their earnings forecast models following the results, but remain divided on the company's outlook. The latest consensus estimates 2026 revenue at approximately ¥120.7 billion and earnings per share at ¥11.53. Before the earnings release, the estimates were ¥120.9 billion for revenue and ¥12.32 for EPS.
The target price remains unchanged at HK$250, while there is a wide gap between the most bullish and most bearish analysts' target prices. The highest target is HK$309 and the lowest is HK$161, with the range of forecasts suggesting a broad range of assumptions about the business's underlying scenarios.
Industry-wide revenue growth is expected to average approximately 7.1% annually through the end of 2026, and NetEase's growth is expected to remain broadly in line with its peers. Post-earnings analysis has suggested that long-term earnings trends may receive greater emphasis than next year's outlook.