NetEase dips after fourth-quarter results fall short of estimates

Investing.com -- NetEase shares fell more than 4% in U.S. premarket trading Wednesday after the company reported fourth-quarter results that missed expectations on both earnings and revenue.

The company posted Q4 EPS of RMB10.95, below the consensus estimate of RMB14.12. Revenue rose 3% year over year to RMB27.55 billion, but came in short of analyst expectations of RMB28.71 billion.

"Total revenue came in 4.3% below consensus but inline with our estimates," Jefferies analysts said in a post-earnings note.

Games and related value-added services generated RMB22.0 billion ($3.1 billion) in revenue, up 3.4% from the same quarter in 2024.

Youdao delivered revenue of RMB1.6 billion ($223.7 million), marking a 16.8% increase year over year.

"We concluded 2025 with another healthy quarter, reflecting the durability of our long-term game operations and the growing impact of our global titles," said William Ding, CEO and Director of NetEase.

"AI has become a foundational competency for our development and operations. We have been systematically applying AI throughout game development and gameplay, where it is already driving meaningful improvement in production efficiency and unlocking new interactive experiences for our players that were previously out of reach."

NetEase Cloud Music reported revenue of RMB2.0 billion ($281.5 million), up 4.7% compared with a year earlier.

Revenue from innovative businesses and other segments totaled RMB2.0 billion ($292.8 million), down 10.4% from the same period last year.

NetEase said its previously approved share repurchase program of up to $5 billion has been extended for an additional 36 months and will now run through January 9, 2029.

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