NetEase, Inc. (NTES) Earnings
NetEase, Inc. is expected to report next earnings on August 13, 2026 (in NaN days), with a consensus EPS estimate of $2.35. NTES has beaten EPS estimates in 5 of its last 12 reported quarters (average surprise -1.5% over the last four).
| Report date | EPS est | EPS actual | Surprise | Revenue | Rev. surprise |
|---|---|---|---|---|---|
| May 21, 2026 | $2.19 | $2.53 | +15.5% | $4.4B | +4.3% |
| Feb 11, 2026 | $2.03 | $1.57 | -22.7% | $3.9B | -9.5% |
| Nov 20, 2025 | $2.08 | $2.07 | -0.5% | $4.0B | -1.3% |
| Aug 14, 2025 | $2.04 | $2.07 | +1.5% | $3.9B | -2.2% |
| May 15, 2025 | $2.01 | $2.41 | +19.9% | $4.0B | -0.8% |
| Mar 6, 2025 | $1.73 | $1.42 | -17.9% | $3.7B | — |
| Nov 14, 2024 | $1.74 | $1.44 | -17.2% | $3.7B | -4.2% |
| Aug 22, 2024 | $1.79 | $1.66 | -7.3% | $3.5B | -3.0% |
| May 23, 2024 | $1.85 | $1.81 | -2.2% | $3.7B | +1.7% |
| Feb 29, 2024 | $1.80 | $1.60 | -11.1% | $3.8B | -1.5% |
| Nov 16, 2023 | $1.65 | $1.82 | +10.3% | $3.7B | -0.4% |
| Aug 24, 2023 | $1.33 | $1.91 | +43.6% | $3.3B | -2.0% |
Source: company filings + earnings calendar. For informational purposes only — not investment advice.
Earnings call summary
Q1 FY2026 · May 21, 2026
AI summary of management’s prepared remarks and analyst Q&A. For informational purposes only — not investment advice.
Management highlights
### Game Portfolio Performance - **Global titles**: *Where We Meet* maintained strong post-launch momentum after its November 2025 global launch. Its 1.6 version update pushed it to number 2 on Steam's global top-seller chart, and it achieved a record quarterly revenue. *Marvel Rivals* grew its global hero shooter audience via steady seasonal content updates, including a Deadpool crossover that pushed it to number 2 on Steam's US top-seller chart; its year-long Path to Doomsday event ties content to the upcoming *Avengers Doomsday* film to deepen engagement. *Knives Out*'s Tokyo Ghoul crossover reached number 3 on Japan's iOS top chart, while *Blackstrea* hit a record high daily active user count for its second global mobile anniversary. - **Domestic established franchises**: *Fantasy Westward Journey Online* (flagship MMORPG) hit an all-time high quarterly revenue and a new peak concurrent user record of 3.9 million on its unlimited server, driven by new social and progression features that grew both new and returning user counts. *Fantasy Westward Journey Mobile* hit its highest daily active user count since 2017 for its 11th anniversary. *Tianxia*, an 18-year-old MMO franchise, delivered a record commercial performance. *Ghost Story Mobile* (10-year anniversary) has over 200 million registered users, with sustained engagement via consistent content and media crossovers. *Anki Party* (China's leading party game) reached the top of China's iOS chart after a My Little Pony crossover. *Identity V* maintained steady asymmetric battle arena engagement via anniversary content updates and a successful global esports finals in Shanghai. *Infinite Borders* (SLG) improved daily active users via gameplay quality-of-life updates and IP crossovers. *Naraka: Bladepoint* expanded its reach via a crossover with Overwatch. *Sword of Justice* grew user engagement via user-generated content tools including text-to-item generation and in-game narrative creation. - **Blizzard partnership titles**: *World of Warcraft*'s Midnight expansion launched simultaneously globally in March, with localized optimizations that sustained high player retention and solid year-over-year performance. *Diablo 4*'s *Lord of Hatred* expansion launched globally in April, and *Diablo II Resurrected* grew monthly active users via a new DLC. A two-week Overwatch x *Naraka: Bladepoint* crossover drove strong cross-community engagement during the Spring Festival. - **Upcoming pipeline**: *Sea of Remnants* and *Ananta* are progressing steadily toward launch, with positive test feedback for *Sea of Remnants* that is now in final pre-launch preparation. ### Non-Game Business Highlights - Youdao advanced its AI-native strategy, iterating on its Confucius large language model and expanding its AI agent matrix to add two new AI-native applications: Lobster AI (open-source personal desktop assistant) and Yodoboku (AI knowledge base for complex information synthesis). AI-driven tools boosted demand for performance-based online marketing services, while smart devices prioritized profitability over sales volume. - NetEase Yanxuan (e-commerce) marked its 10th anniversary, expanding its pet product category with strengthened R&D, supply chain, and membership capabilities, maintaining leading positions for pet food, home, and consumer goods across Chinese e-commerce platforms. ### ESG and Recognition - NetEase published its 7th annual ESG report, improved data center energy efficiency cutting greenhouse gas emissions 12% year-over-year, and was upgraded to an MSCI AAA ESG rating, placing it among global media and entertainment industry leaders. It has been named to Forbes' World's Best Employers list for nine consecutive years.
Guidance
There were no explicit changes to or updates of prior full-year financial guidance provided during the call. Management confirmed that *Sea of Remnants* is on track for a targeted Q3 2026 launch, and reaffirmed confidence in continued growth momentum from expanding global reach, long-term live service strength of established franchises, and upcoming innovative new titles.
Segment performance
Total net revenue for Q1 2026 was RMB 30.6 billion, a 6% year-over-year increase. 1. Games and related value-added services: Net revenue of RMB 25.7 billion, up 7% year-over-year; contributed 84% of total net revenue. Online game revenue within this segment was RMB 25.1 billion, up 7% year-over-year and 18% quarter-over-quarter. Gross profit margin was 74.8%, up from 68.8% year-over-year, driven by lower platform revenue-sharing costs. 2. Youdao: Net revenue of RMB 1.3 billion, up 4% year-over-year; contributed 4.2% of total net revenue. Gross profit margin was 44.7%, down from 47.3% year-over-year due to lower smart device margins. 3. NetEase Cloud Music: Net revenue of RMB 2 billion, up 7% year-over-year; contributed 6.5% of total net revenue. Gross profit margin was 37.1%, broadly stable year-over-year. 4. Innovative business and others: Net revenue of RMB 1.5 billion, down 5% year-over-year; contributed 4.9% of total net revenue. Gross profit margin improved to 42% from 38.8% year-over-year, driven by margin expansion in select innovative sub-segments.
Risks & headwinds
Management noted that forward-looking statements are subject to inherent risks and uncertainties that could cause actual results to differ materially from expectations. General risk factors that could impact NetEase's business and financial performance are disclosed in the company's SEC filings (including Form 20-F) and Hong Kong Stock Exchange filings. No new material unpriced risks or operational failures were discussed on the call.
Analyst Q&A
Q: What is the latest progress, user feedback, monetization design, and launch timeline for *Sea of Remnants*, and what are the plans for global cross-platform rollout? /
A: After a February technical test, the team received valuable player feedback and is now preparing for the upcoming Dawnbreaker test. The next test will showcase a more complete game world and richer gameplay ahead of the targeted Q3 2026 launch. Monetization is centered on cosmetic customization around characters, designed to be a natural extension of gameplay and deliver a rich experience with low pay-to-win burden. Additional details will be shared after testing and in future announcements.
Q: What is NetEase's competitive strategy for *Ananta* amid a crowded open world genre, with new competing titles launching this year and the blockbuster GTA releasing before year-end? How will *Ananta* capture user growth? /
A: A crowded open world genre proves high user demand and a large market ceiling, and competition is not zero-sum: great products expand the overall market rather than only split existing share. *Ananta* is differentiated as a modern urban open world driven by immersive daily life experiences, unlike traditional open world RPGs or anime action games. Its competitive edge comes from authentic daily activities (shopping, socializing, business management) rather than map size or flashy combat. The team is prioritizing content quality over rushing a launch, targeting a genre breakthrough that appeals to a broad audience of players interested in virtual city living, rather than fitting into a narrow niche.
Q: What is NetEase's assessment of its global game expansion progress, and what is the overseas growth potential of *Where We Meet* and the MMO genre overall? /
A: *Where We Meet* has set a new benchmark for Chinese wuxia games overseas, holding an 87% positive rating on Steam six months post-launch and repeatedly hitting the top 2 of Steam's global top seller chart after major updates, even in traditionally hard-to-penetrate Western markets. Overseas players appreciate its immersive wuxia setting and highly accept its free-to-play, no pay-to-win model, proving its unique experience resonates globally. Going forward, NetEase will unlock more growth potential by improving cross-device compatibility, expanding to more platforms, strengthening localization and global publishing capabilities, and continuing to invest to make it a long-term successful global flagship title.
Q: What is the latest update on *Fantasy Westward Journey* PC's unlimited server, one year post-launch, and how will NetEase sustain its success? /
A: The unlimited server hit a new peak concurrent user record of 3.9 million in Q1, and has effectively expanded the game's total user base. Both the unlimited server and the game's existing traditional servers have seen steady user growth, and the game's overall ecosystem remains healthy thanks to the development team's years of long-term live operations experience. NetEase will continue its long-term operation strategy and explore new opportunities to grow the title further.