In "Major Banks," China International Capital Corporation predicts that NetEase's revenue increased by 7% last season, while Non-GAAP net profit decreased by 15%

CICC published a research report, expecting NetEase (09999.HK) to have a smooth transition in its performance for the fourth quarter of 2025, with revenue expected to grow by 7% year-on-year to RMB 28.5 billion, slightly lower than the market expectation of RMB 28.8 billion. This is mainly due to potential investment losses and foreign exchange losses, with non-GAAP net profit expected to decline by 15% year-on-year to RMB 8.25 billion, below the market expectation of RMB 9.23 billion. The firm maintains a "outperform industry" rating for NetEase, with a target price of HKD 275.

The report pointed out that NetEase's flagship game series "Fantasy Westward Journey" continues to contribute steadily, with the PC version benefiting from deferred revenue recognition during the quarter, expected to achieve significant year-on-year growth. The mobile version continues its good momentum, while "Egg Party" is expected to see further recovery in user activity and revenue through ongoing holiday events. In terms of new releases, "Yanyun Sixteen Sounds" maintains stable revenue in the domestic market, and its overseas version has performed strongly since its launch in mid to late November last year, with player numbers exceeding 15 million in the first month and topping charts in multiple regions, expected to gradually contribute. "Marvel Duel" has been steadily climbing the Steam bestseller list since November last year.

CICC believes that NetEase's product pipeline for 2026 is rich, laying the foundation for future growth. Key projects include the ocean adventure RPG "Forgotten Sea," which is planned to enter a new round of testing in February 2026, with the company stating its goal to launch within the year, and the life simulation party game "Starry Sky Friends" which has already obtained a license; the highly anticipated open-world game "Infinity," whose innovative framework and commercialization design are worth looking forward to. Additionally, the company has several projects in development, including the auto chess game "Code: Demon" and "Fenghua Duel." The diversified high-quality product pipeline will consolidate the company's core R&D advantages and promote the implementation of globalization and multi-platform strategies.

CICC expects the company to continue implementing generous dividends in the fourth quarter. Considering investment losses and other factors, CICC has lowered its forecast for NetEase's non-GAAP net profit in 2025 by 2% to RMB 38.5 billion, while maintaining its net profit forecasts for 2026 and 2027 at RMB 42.6 billion and RMB 45.3 billion, respectively