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Online gaming helps NetEase clock 13% revenue growth in q2, expands share buyback

Benzinga Real-time News ·  Aug 31, 2021 06:49  · Earnings
  • Chinese gaming company $NetEase(NTES.US)$ reported second-quarter FY21 revenue growth of 12.9% year-on-year to $3.179 billion, marginally missing the analyst consensus of $3.181 billion.

  • Segments and margins: Online game services revenues grew 5.1% Y/Y to $2.3 billion. The gross margin expanded 230 bps to 66.1%.

  • Net revenues from $Youdao, Inc(DAO.US)$ increased 107.5% Y/Y to $200.3 million. The margin expanded 710 bps to 52.3%.

  • Innovative businesses revenue rose 26% Y/Y to $728.4 million. The margin expanded 80 bps to 19.3%.

  • Non-GAAP net income per ADS of $0.97 beat the analyst consensus of $0.94.

  • NetEase held $16.7 billion in cash and equivalents and generated $731.5 million in operating cash flow.

  • Dividend: The board approved a dividend of $0.24 per ADS for Q2, down 20% Q/Q. 

  • Share buybacks: The board increased the share buyback program from the previous limit of $2 billion to the new $3 billion. It also approved a share purchase program of up to $50.0 million of Youdao.

  • Price Action: NTES shares traded higher by 2.39% at $91.76 in the premarket session on the last check Tuesday.

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