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NetEase (NTES) to Report Q1 Earnings: What's in the Cards?
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NetEase (NTES - Free Report) is set to report first-quarter fiscal 2020 results on May 19.
The Zacks Consensus Estimate for first-quarter revenues currently stands at $2.31 billion, suggesting a decline of 15.6% from the figure reported in the year-ago quarter.
However, the consensus mark for earnings has been steady at $3.51 per share over the past 30 days, indicating growth of 27.6% from the year-ago quarter’s reported figure.
Notably, the company’s earnings beat the Zacks Consensus Estimate in the trailing four quarters, the average positive surprise being 147.8%.
Let’s see how things have shaped up for this announcement.
Factors to Consider
NetEase’s diversified online gaming portfolio is expected to have been a major contributor to the top line in the to-be-reported quarter.
Moreover, coronavirus-led lockdown is expected to have driven the number of active users in the to-be-reported quarter.
NetEase’s subscriber growth is expected to reflect the benefits of the launch of new titles in China. Fantasy Westward Journey 3D, released at the beginning of the fourth quarter, topped China’s iOS download chart soon after its launch.
Additionally, the company also introduced other thrilling new titles at the end of 2019 including Xuan Yuan Sword: Dragon Upon the Cloud, Bloom & Blade, Onmyoji: The Card Game, Champion of the Fields, The Ninth Institute and Astracraft , which are expected to have added to user growth and contributed to the company’s top line in the soon-to-be reported quarter.
Moreover, the availability of Activision Blizzard’s World of Warcraft Classic in China and continued popularity of the franchise is expected to have aided subscriber growth in the to-be-reported quarter as users practiced isolation due to the coronavirus outbreak.
Further, its expanded international presence with titles like Knives Out, Identity V and Marvel Super War is noteworthy.
Meanwhile, increased efforts to monetize NetEase Cloud Music are expected to have driven Innovative business segment’s top line.
However, a weak advertising market in China, increasing government regulations related to gaming and stiff competition from Tencent Holdings are expected to have negatively impacted the top line.
Moreover, a weak online advertising environment is expected to have hurt NetEase Cloud Music’s top line in the fourth quarter.
What Our Model Says
According to the Zacks model, the combination of a positive Earnings ESP and Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat.
NetEase has an Earnings ESP of +3.70% and a Zacks Rank #3. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Other Stocks to Consider
Here are some companies, which, per our model, also have the right combination of elements to post an earnings beat in their upcoming release.
NVIDIA Corporation (NVDA - Free Report) has an Earnings ESP of +0.15% and currently carries a Zacks Rank of 2.
Zacks Top 10 Stocks for 2020
In addition to the stocks discussed above, would you like to know about our 10 finest buy-and-hold tickers for the entirety of 2020?
Last year's 2019 Zacks Top 10 Stocks portfolio returned gains as high as +102.7%. Now a brand-new portfolio has been handpicked from over 4,000 companies covered by the Zacks Rank. Don’t miss your chance to get in on these long-term buys.
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NetEase (NTES) to Report Q1 Earnings: What's in the Cards?
NetEase (NTES - Free Report) is set to report first-quarter fiscal 2020 results on May 19.
The Zacks Consensus Estimate for first-quarter revenues currently stands at $2.31 billion, suggesting a decline of 15.6% from the figure reported in the year-ago quarter.
However, the consensus mark for earnings has been steady at $3.51 per share over the past 30 days, indicating growth of 27.6% from the year-ago quarter’s reported figure.
Notably, the company’s earnings beat the Zacks Consensus Estimate in the trailing four quarters, the average positive surprise being 147.8%.
Let’s see how things have shaped up for this announcement.
Factors to Consider
NetEase’s diversified online gaming portfolio is expected to have been a major contributor to the top line in the to-be-reported quarter.
Moreover, coronavirus-led lockdown is expected to have driven the number of active users in the to-be-reported quarter.
NetEase, Inc. Price and EPS Surprise
NetEase, Inc. price-eps-surprise | NetEase, Inc. Quote
NetEase’s subscriber growth is expected to reflect the benefits of the launch of new titles in China. Fantasy Westward Journey 3D, released at the beginning of the fourth quarter, topped China’s iOS download chart soon after its launch.
Additionally, the company also introduced other thrilling new titles at the end of 2019 including Xuan Yuan Sword: Dragon Upon the Cloud, Bloom & Blade, Onmyoji: The Card Game, Champion of the Fields, The Ninth Institute and Astracraft , which are expected to have added to user growth and contributed to the company’s top line in the soon-to-be reported quarter.
Moreover, the availability of Activision Blizzard’s World of Warcraft Classic in China and continued popularity of the franchise is expected to have aided subscriber growth in the to-be-reported quarter as users practiced isolation due to the coronavirus outbreak.
Further, its expanded international presence with titles like Knives Out, Identity V and Marvel Super War is noteworthy.
Meanwhile, increased efforts to monetize NetEase Cloud Music are expected to have driven Innovative business segment’s top line.
However, a weak advertising market in China, increasing government regulations related to gaming and stiff competition from Tencent Holdings are expected to have negatively impacted the top line.
Moreover, a weak online advertising environment is expected to have hurt NetEase Cloud Music’s top line in the fourth quarter.
What Our Model Says
According to the Zacks model, the combination of a positive Earnings ESP and Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat.
NetEase has an Earnings ESP of +3.70% and a Zacks Rank #3. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Other Stocks to Consider
Here are some companies, which, per our model, also have the right combination of elements to post an earnings beat in their upcoming release.
BJs Wholesale Club Holdings Inc (BJ - Free Report) has an Earnings ESP of +6.42% and a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.
NVIDIA Corporation (NVDA - Free Report) has an Earnings ESP of +0.15% and currently carries a Zacks Rank of 2.
Zacks Top 10 Stocks for 2020
In addition to the stocks discussed above, would you like to know about our 10 finest buy-and-hold tickers for the entirety of 2020?
Last year's 2019 Zacks Top 10 Stocks portfolio returned gains as high as +102.7%. Now a brand-new portfolio has been handpicked from over 4,000 companies covered by the Zacks Rank. Don’t miss your chance to get in on these long-term buys.
Access Zacks Top 10 Stocks for 2020 today >>