NetEase Clocks 23% Revenue Growth In Q4 Backed By Strength In Flagship Titles, New Games

NetEase Inc NTES reported fourth-quarter FY21 revenue growth of 23.3% year-on-year to $3.82 billion, beating the consensus of $3.81 billion.
Segments and margins: Online game services revenues grew 29.8% Y/Y to $2.7 billion. The gross margin for online game services expanded by 100 bps to 64.1%.
Net revenues from Youdao Inc DAO increased 20.5% Y/Y to $209.3 million, and the corresponding gross margin expanded by 320 bps to 50.7%.
Innovative businesses revenue rose 0.6% Y/Y to $588.9 million, and the gross margin contracted 140 bps to 26.8%.
Non-GAAP net income per ADS of $1.56 beat the consensus of $1.04.
NetEase held $16.2 billion in cash and equivalents and generated $1.3 billion in operating cash flow.
Dividend: The board approved a dividend of $0.405 per ADS for Q4 versus $0.225 per ADS paid in Q3.
William Ding, CEO, and Director of NetEase, said, "While our flagship titles remain strong, we also introduced a number of highly successful games, including Naraka: Bladepoint and Harry Potter: Magic Awakened. These new titles further strengthen our portfolio and demonstrate our ability to develop world-class IP. For 2022, we are very excited to introduce more new games to broader demographics, paving the way for solid growth."
Price Action: NTES shares traded lower by 3.34% at $88.50 in the premarket session on the last check Thursday.

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