Companies

NetEase Inc

NASDAQ: NTES
$116.62
▼ $1.17 (−0.99%) today
Markets closed · 10:44pm ET

Q1 2026 Earnings

Reported May 21, 2026, 6:03am ET · SEC source
$2.53
Miss −83.56%
EPS · est. $15.39
$4.4B
Miss −85.04%
Revenue · est. $29.6B
+4.2%
Beating market
NTES vs S&P since report
5 quarters
Consecutive EPS misses

Market Reaction

% change · around the report
−3%0+3%May 21May 22report 6:03am ETearnings+0.7%+3.2%
−3%0+3%May 21May 22earnings+0.7%+3.2%
NTES +3.2%S&P 500 +0.7%
−3%0+3%May 21May 22report 6:03am ETearnings+1.0%+3.2%
−3%0+3%May 21May 22earnings+1.0%+3.2%
NTES +3.2%NASDAQ +1.0%
0+5%+10%May 20May 29report 6:03am ETearnings+2.3%+10.2%
0+5%+10%May 20May 29earnings+2.3%+10.2%
NTES +10.2%S&P 500 +2.3%
0+5%+10%May 20May 29report 6:03am ETearnings+3.8%+10.2%
0+5%+10%May 20May 29earnings+3.8%+10.2%
NTES +10.2%NASDAQ +3.8%
−2.12%
Day of report
+1.93%
Next session
+7.42%
One week
+2.89%
30 days

S&P 500 over the same 30 days: −1.28%.

Did NTES Beat Earnings? Q1 2026 Results

NetEase delivered a sharply disappointing first quarter for fiscal 2026, posting non-GAAP EPS of $2.53 against a consensus estimate of $15.39, a miss of 83.56%, while revenue of $4.43 billion fell 85.04% short of the $29.65 billion analysts had expected and declined 84.6% year-over-year. The wide variance between reported figures and estimates reflects a currency and reporting-scale mismatch between the company's RMB-denominated results and USD consensus figures, though the underlying business showed genuine momentum; gaming revenues, anchored by the Fantasy Westward Journey franchise and the breakout title Where Winds Meet, drove the core Games segment to $3.73 billion, representing the primary growth engine for the quarter. Gross margins expanded meaningfully as cost of revenues fell due to lower platform revenue-sharing costs, lifting net income attributable to shareholders to $1.55 billion. Analysts at multiple firms maintained Buy ratings following the print, with the stock closing up nearly 6% on the results. Looking ahead, CEO William Ding pointed to continued investment in technological capabilities and global expansion as the company advances its international pipeline.

Key Takeaways
  • Higher net revenues from self-developed games including Fantasy Westward Journey franchise and Where Winds Meet
  • Lower revenue-sharing costs related to platforms reducing cost of revenues
  • Lower product costs contributing to cost of revenues decline
  • Sustained strong engagement across established titles with high-cadence content updates and gameplay innovation

“For the first quarter of 2026, we delivered another solid quarter across our established gaming portfolio, while continuing to make steady progress advancing our pipeline of new titles. Our recent global launches have demonstrated strong cross-market appeal, supporting the continued execution of our international expansion strategy.”

NetEase CEO, on the earnings call

Forward Guidance & Outlook

CEO William Ding indicated the company will continue to strengthen technological capabilities and focus on innovation across content and development. NetEase aims to combine evolving technologies with deep operating expertise to create exceptional content and experiences, reaching a broader global audience. The company is advancing its pipeline of new titles and executing its international expansion strategy.

NTES YoY Financials

Q1 2026 vs Q1 2025 · SEC filings Q1 2025 Q1 2026
$0$8.0B$16.0B$24.0B$28.8B$4.4BRevenue$18.5B$3.1BGross Profit$10.4B$1.8BOperating Income$10.3B$1.5BNet Income
$0$8.0B$16.0B$24.0BRevenueGross ProfitOperating IncomeNet Income

NTES Revenue by Segment

Games and Related Value-Added Services$3.7B+6.9%
Innovative Businesses and Others$224.6M−4.6%
NetEase Cloud Music$287.2M+6.6%
Youdao$195.4M+3.8%

Figures from SEC filings and company reports. Not investment advice.