NetEase Inc (NASDAQ: NTES) stock fell over 1.8% in the pre-market session of Feb 26th, 2021 (as of 07:54:36 UTC-5; Source: Google finance) after the company posted lower than expected results for the fourth quarter of FY 20. The company has reported net income from continuing operations attributable to the Company’s shareholders of RMB975.7 million (US$149.5 million), which includes net exchange losses of RMB1.8 billion (US$276.2 million) and net investment loss of RMB271.9 million (US$41.7 million). Non-GAAP net income from continuing operations attributable to the Company’s shareholders was RMB1.6 billion (US$244.9 million). The company delivered the gross profit for the fourth quarter of 2020 of RMB9,927.8 million (US$1,521.5 million), compared to RMB9,885.8 million and RMB8,210.4 million for the preceding quarter and the fourth quarter of 2019, respectively. The quarter-over-quarter decline in online game services gross profit was mainly due to slightly decreased net revenues from certain mobile games. The year-over-year rise was mainly due to increased net revenues from mobile games such as Fantasy Westward Journey H5, Sky, Life-After and Invincible, as well as PC games such as Fantasy Westward Journey Online. The quarter-over-quarter and year-over-year increases in Youdao gross profit were on back of increased net revenues from its learning services and learning products. At the end of December, 2020, the Company’s total cash and cash equivalents, current and non-current time deposits and short-term investments balance were of total RMB100,099.6 million (US$15,340.9 million), compared to RMB74,406.0 million as of December 31, 2019.
NTES in the fourth quarter of FY 20 has reported the adjusted earnings per ADS of 36 cents, beating the analysts’ estimates for the adjusted earnings per ADS of 45 cents, according per analysts polled by Thomson Reuters. The company had reported the adjusted revenue growth of 25.6 percent to $3 billion in the fourth quarter of FY 20 while the analysts expected revenue of $3.06 billion, for the quarter. Online game services net revenues were $2.1 billion, which represents an increase of 15.5%. Youdao net revenues were RMB1.1 billion (US$169.6 million), which represents an increase of 169.7% compared with the fourth quarter of 2019. Innovative businesses and others net revenues were RMB5.3 billion (US$805.3 million), which represents an increase of 41.3% compared with the fourth quarter of 2019.
Additionally, the company has approved a dividend of $0.0120 per share ($0.0600 per ADS) for the fourth quarter of 2020, to holders of ordinary shares and holders of ADSs as of the close of business on March 12, 2021. The Company has also announced today that it has approved a new share repurchase program of up to US$2.0 billion of the Company’s outstanding ADSs and ordinary shares in open market transactions for a period not to exceed 24 months beginning on March 2, 2021.