NetEase, Inc. (NTES) Income Statement

27Y historyFree accessUpdated daily

NetEase's financial profile is characterized by a significant step-change in profitability, with gross margin expanding to 70.5% and operating margin reaching 40.2% in 2026Q2, driven by effective fixed-cost discipline as SG&A remained stable between $3.7B and $5.6B despite revenue growth.

Annual statement

NTES Income Statement

NetEase, Inc. (NTES) annual income statement — 27-year revenue, gross profit & net income history

Annual Quarterly

Metric	TTM	Dec'25	Dec'24	Dec'23	Dec'22	Dec'21	Dec'20	Dec'19	Dec'18	Dec'17	Dec'16	Dec'15	Dec'14	Dec'13	Dec'12	Dec'11	Dec'10	Dec'09	Dec'08	Dec'07	Dec'06	Dec'05	Dec'04	Dec'03	Dec'02	Dec'01	Dec'00	Dec'99

Sales/Revenue	116.52B	112.63B	105.3B	103.47B	96.5B	87.61B	73.67B	59.24B	51.18B	44.44B	38.18B	22.8B	11.71B	9.2B	8.2B	7.29B	5.51B	3.76B	3.08B	2.21B	2.16B	1.61B	903.6M	542.23M	220.89M	28.31M	65.05M	15.62M
Revenue Growth %	6.24%	6.96%	1.77%	7.23%	10.15%	18.92%	24.35%	15.75%	15.17%	16.39%	67.43%	94.68%	27.37%	12.14%	12.49%	32.37%	46.6%	21.8%	39.37%	2.26%	34.24%	78.44%	66.64%	145.47%	680.38%	-56.49%	316.52%	-
Cost of Goods Sold	38.27B	40.22B	39.49B	40.4B	43.73B	40.64B	34.68B	27.69B	38.75B	28.19B	16.52B	9.4B	3.26B	2.48B	2.58B	2.37B	972.37M	952.23M	559.61M	415.45M	381.3M	275.24M	183.8M	85.48M	71.66M	60.07M	32.18M	11.12M
COGS % of Revenue	-	35.71%	37.5%	39.05%	45.32%	46.38%	47.08%	46.73%	75.72%	63.44%	43.26%	41.22%	27.85%	26.95%	31.44%	32.54%	17.65%	25.35%	18.14%	18.77%	17.62%	17.07%	20.34%	15.76%	32.44%	212.22%	49.47%	71.19%
Gross Profit	78.24B	72.4B	65.81B	63.06B	52.77B	46.97B	38.98B	31.56B	28.4B	25.91B	21.66B	13.4B	8.45B	6.72B	5.62B	4.92B	2.78B	2.78B	2.52B	1.8B	1.78B	1.34B	719.79M	456.75M	149.23M	-31.76M	32.87M	4.5M
Gross Margin %	67.15%	64.29%	62.5%	60.95%	54.68%	53.62%	52.92%	53.27%	55.5%	58.31%	56.74%	58.78%	72.15%	73.05%	68.56%	67.46%	50.56%	74.12%	81.86%	81.23%	82.38%	82.93%	79.66%	84.24%	67.56%	-112.22%	50.53%	28.81%
Gross Profit Growth %	-	10.02%	4.35%	19.51%	12.34%	20.49%	23.54%	11.1%	9.61%	19.61%	61.63%	58.6%	25.81%	19.47%	14.32%	76.63%	0%	10.28%	40.45%	0.83%	33.35%	85.77%	57.59%	206.07%	569.81%	-196.63%	630.63%	-
Operating Expenses	37.2B	36.57B	36.22B	35.35B	33.14B	30.55B	24.44B	17.76B	20.51B	13.76B	9.03B	6.13B	3.69B	2.37B	1.91B	1.59B	761.14M	781.28M	610.42M	592.23M	503.18M	360.31M	272.28M	129.76M	145.21M	197.89M	200.75M	57.76M
OpEx % of Revenue	-	32.47%	34.4%	34.17%	34.34%	34.88%	33.18%	29.99%	40.08%	30.96%	23.66%	26.89%	31.47%	25.72%	23.31%	21.88%	13.82%	20.8%	19.79%	26.76%	23.25%	22.35%	30.13%	23.93%	65.74%	699.12%	308.59%	369.8%
Selling, General & Admin	19.11B	18.85B	18.7B	18.87B	18.1B	16.48B	14.08B	9.35B	12.72B	9.39B	5.99B	3.97B	2.36B	1.44B	1.19B	1.13B	516.87M	550.84M	403.39M	411.5M	350.02M	270.14M	237.92M	110.79M	94.66M	181.59M	179.44M	51.05M
SG&A % of Revenue	-	16.73%	17.76%	18.24%	18.76%	18.81%	19.11%	15.79%	24.85%	21.13%	15.68%	17.42%	20.17%	15.7%	14.55%	15.49%	9.38%	14.66%	13.08%	18.59%	16.17%	16.75%	26.33%	20.43%	42.85%	641.55%	275.84%	326.84%
Research & Development	18.09B	17.72B	17.52B	16.48B	15.04B	14.08B	10.37B	8.41B	7.79B	4.37B	3.05B	2.16B	1.32B	921.62M	718.32M	465.49M	244.27M	230.44M	207.02M	180.73M	153.16M	90.17M	34.36M	19.12M	13.81M	11.17M	12.66M	5.73M
R&D % of Revenue	-	15.73%	16.64%	15.93%	15.59%	16.07%	14.08%	14.2%	15.23%	9.84%	7.98%	9.47%	11.3%	10.02%	8.76%	6.38%	4.44%	6.13%	6.71%	8.17%	7.08%	5.59%	3.8%	3.53%	6.25%	39.47%	19.47%	36.71%
Other Operating Expenses	0	0	0	0	0	0	0	0	0	0	0	0	0	0	0	0	0	0	0	0	0	0	0	-149.01K	36.74M	5.13M	8.64M	975.27K
Operating Income	41.04B	35.83B	29.58B	27.71B	19.63B	16.42B	14.54B	13.79B	9.98B	12.99B	12.63B	7.27B	4.77B	4.35B	3.71B	3.32B	2.54B	2.02T	1.91B	1.21B	1.28B	976.82M	447.51M	326.84M	4.02M	-231.93M	-167.87M	-53.26M
Operating Margin %	35.23%	31.82%	28.1%	26.78%	20.34%	18.74%	19.74%	23.28%	19.5%	29.24%	33.08%	31.89%	40.68%	47.33%	45.26%	45.59%	46.2%	53858.52%	62.07%	54.47%	59.13%	60.58%	49.53%	60.28%	1.82%	-819.38%	-258.05%	-340.99%
Operating Income Growth %	-	21.13%	6.77%	41.17%	19.56%	12.92%	5.42%	38.22%	-23.22%	2.9%	73.66%	52.61%	9.48%	17.27%	11.68%	30.62%	-99.87%	-	58.81%	-5.8%	31.02%	118.28%	36.92%	8033.99%	101.73%	-38.16%	-215.21%	-
EBITDA	43.24B	38.07B	32B	30.76B	22.49B	19.69B	18B	16.4B	12.06B	13.8B	12.96B	7.45B	4.94B	4.51B	3.9B	3.62B	2.78B	2.02T	2.01B	1.3B	1.36B	1.02B	473.96M	344.27M	25.81M	-214.59M	-159.23M	-52.28M
EBITDA Margin %	37.11%	33.8%	30.39%	29.73%	23.3%	22.48%	24.43%	27.69%	23.57%	31.05%	33.94%	32.69%	42.17%	49.05%	47.51%	49.61%	50.41%	53862.35%	65.02%	58.95%	62.76%	63.12%	52.45%	63.49%	11.68%	-758.13%	-244.77%	-334.75%
EBITDA Growth %	18.15%	18.97%	4.02%	36.81%	14.19%	9.43%	9.7%	36.01%	-12.58%	6.49%	73.8%	50.91%	9.5%	15.78%	7.73%	30.26%	-99.86%	-	53.71%	-3.94%	33.46%	114.73%	37.67%	1233.83%	112.03%	-34.77%	-204.56%	-
D&A (Non-Cash Add-back)	2.2B	2.24B	2.42B	3.06B	2.86B	3.28B	3.46B	2.61B	2.08B	801.8M	327.51M	182.45M	174.46M	158.36M	184.51M	293.24M	232.17M	143.58M	90.96M	99.11M	78.37M	40.9M	26.45M	17.43M	21.79M	17.34M	8.64M	975.26K
EBIT	41.04B	35.83B	29.58B	27.71B	19.63B	16.42B	14.54B	13.79B	9.98B	12.99B	12.63B	7.27B	4.77B	4.35B	3.71B	3.32B	2.54B	2.02B	1.91B	1.21B	1.37B	1.03B	473.87M	344M	15.31M	-229.65M	-159.23M	-52.29M
Net Interest Income	4.36B	4.62B	4.92B	4.12B	2.15B	1.52B	1.6B	821.77M	586.67M	666.62M	541.97M	596.93M	601.5M	506.18M	423.63M	258.05M	141M	128.17M	144.81M	112.6M	94.36M	57.73M	18.46M	11.27M	6.16M	0	27.83M	0
Interest Income	4.36B	4.62B	4.92B	4.12B	2.15B	1.52B	1.6B	821.77M	586.67M	667.32M	541.97M	596.93M	601.5M	506.18M	423.63M	258.05M	141M	128.17M	144.81M	112.6M	94.36M	58.07M	22.33M	11.28M	7.56M	0	27.83M	0
Interest Expense	0	0	0	0	0	0	0	0	0	0	0	0	0	0	0	0	0	0	0	0	0	344.86K	3.88M	0	1.4M	0	0	0
Other Income/Expense	-347.83M	5B	6.13B	6.35B	4.62B	4.69B	833.68M	2.59B	1.1B	844.67M	1.27B	838.18M	693.32M	623.22M	566.57M	292.29M	32.17M	127.2B	-17.23M	61.1M	94.99M	50.13M	22.49M	17.22M	9.89M	-14.09M	25.23M	1.36M
Pretax Income	40.7B	40.83B	35.72B	34.06B	24.25B	21.1B	15.37B	16.38B	11.08B	13.84B	13.9B	8.11B	5.46B	4.98B	4.28B	3.62B	2.58B	2.15T	1.9B	1.27B	1.37B	1.03B	470M	344.06M	13.9M	-246.02M	-142.64M	-51.89M
Pretax Margin %	34.93%	36.25%	33.92%	32.92%	25.13%	24.09%	20.87%	27.66%	21.64%	31.14%	36.4%	35.57%	46.6%	54.11%	52.17%	49.59%	46.78%	57244.35%	61.51%	57.23%	63.52%	63.69%	52.01%	63.45%	6.29%	-869.17%	-219.27%	-332.27%
Income Tax	7.54B	6.03B	5.46B	4.7B	5.03B	4.13B	3.04B	2.91B	2.47B	2.16B	2.1B	1.27B	662.74M	530.6M	691.64M	392.76M	344.45M	313.86M	300.67M	2.69M	132.49M	94.96M	28.58M	21.13M	-2.4M	0	0	71.32K
Effective Tax Rate %	18.53%	14.77%	15.29%	13.8%	20.75%	19.56%	19.79%	17.79%	22.27%	15.62%	15.13%	15.7%	12.14%	10.66%	16.17%	10.86%	13.37%	0.01%	15.85%	0.21%	9.64%	9.25%	6.08%	6.14%	-17.23%	0%	0%	-0.14%
Net Income	32.49B	33.76B	29.7B	29.42B	20.34B	16.86B	12.06B	21.24B	6.15B	10.71B	11.6B	6.74B	4.76B	4.44B	3.64B	3.23B	2.24B	1.85B	1.6B	1.26B	1.24B	931.99M	441.42M	322.93M	16.3M	-232.64M	-142.64M	-51.97M
Net Margin %	27.89%	29.98%	28.2%	28.43%	21.08%	19.24%	16.37%	35.85%	12.02%	24.1%	30.4%	29.54%	40.61%	48.32%	44.35%	44.36%	40.59%	49.25%	51.76%	57.11%	57.42%	57.8%	48.85%	59.56%	7.38%	-821.89%	-219.27%	-332.72%
Net Income Growth %	-5.01%	13.68%	0.96%	44.64%	20.65%	39.74%	-43.2%	245.19%	-42.54%	-7.73%	72.3%	41.59%	7.04%	22.17%	12.47%	44.66%	20.82%	15.89%	26.31%	1.71%	33.35%	111.13%	36.69%	1881.42%	107.01%	-63.09%	-174.5%	-
Net Income (Continuing)	33.15B	34.8B	30.26B	29.36B	19.22B	16.98B	12.33B	13.47B	8.62B	11.68B	11.79B	6.84B	4.8B	4.45B	3.59B	3.22B	2.23B	1.84B	1.6B	1.26B	1.24B	931.99M	441.42M	322.87M	16.3M	-233.21M	-142.64M	-51.97M
Discontinued Operations	0	0	0	0	624.86M	0	0	7.96B	-2.14B	-834.45M	0	0	0	0	0	0	0	0	0	0	0	0	0	0	0	0	0	0
Minority Interest	4.47B	4.81B	3.81B	3.8B	4.14B	3.95B	11.67B	1.14B	794.21M	703.13M	271.86M	83.52M	-32.19M	-76.91M	-79.12M	-28.24M	-13.43M	-13.43M	209.26K	207.8K	0	0	0	0	0	0	0	0
EPS (Diluted)	50.43	52.25	45.95	45.25	30.20	25.05	18.00	20.40	12.75	16.15	17.55	10.20	7.25	6.80	5.55	4.95	2.85	2.85	2.45	1.90	1.80	0.33	0.16	0.13	0.01	-0.13	-0.07	-0.03
EPS Growth %	-5.64%	13.71%	1.55%	49.83%	20.56%	39.17%	-11.76%	60%	-21.05%	-7.98%	72.06%	40.69%	6.62%	22.52%	12.12%	73.68%	0%	16.33%	28.95%	5.56%	445.45%	106.25%	23.08%	940%	109.62%	-81.82%	-142.37%	-
EPS (Basic)	-	52.90	46.40	45.75	31.15	25.35	18.25	20.60	12.80	16.25	17.70	10.25	7.30	6.85	5.55	4.95	2.85	2.90	2.55	2.05	1.90	0.36	0.18	0.13	0.01	-0.10	-0.07	-0.03
Diluted Shares Outstanding	644.33M	645.58M	646.12M	650.41M	673.5M	673.5M	669.95M	649.99M	650.94M	663.1M	661.42M	661.04M	655.41M	651.26M	657.67M	655.34M	649.8M	648.03M	646.84M	661.51M	699.68M	2.85B	2.79B	2.68B	2.5B	1.75B	2B	1.76B
Basic Shares Outstanding	640.61M	638.36M	646.3M	650.09M	652.69M	665.17M	661.09M	644.09M	647.06M	658.06M	656.35M	656.88M	652.89M	649.57M	656.53M	653.11M	645.05M	643.29M	623.42M	617.29M	646.37M	2.58B	2.53B	2.5B	2.44B	1.75B	2B	1.76B
Dividend Payout Ratio	-	39.84%	37.6%	27.24%	33.06%	20.81%	35.48%	41.63%	23.41%	30.42%	21.94%	21.8%	41.69%	18.35%	-	-	-	-	-	-	-	-	-	-	-	-	-	-

Key Metrics

Growth RegimeAccelerating

ProfitabilityStrong

Balance SheetHealthy

Cash FlowRobust

Top Statement Risk

EPS Volatility from Non-Operating Items

Growth Reacceleration Amidst Volatile Trends

NetEase's revenue growth reaccelerated to 7.6% in 2026Q2, reversing a deceleration trend seen in late 2024 and early 2025, as reported in its recent financial statements.

The company's revenue trajectory has shown significant volatility, swinging from negative growth in 2024Q4 (-1.4%) to a peak of 9.4% in 2025Q2, before settling into a mid-single-digit range. The recent reacceleration to 7.6% suggests a potential stabilization in its core gaming and content offerings after a period of normalization. However, the inconsistent quarterly pattern indicates that growth may still be heavily tied to the timing of major game launches and content cycles rather than a smooth, secular trend.

Structural Margin Expansion to Premium Levels

Gross margin has expanded significantly, reaching 70.5% in 2026Q2, up from a low of 60.8% in 2024Q4, indicating a substantial shift in the company's cost of revenue structure.

This gross margin improvement appears structural, as it has been sustained over multiple quarters, moving the company well beyond the 63-65% range seen in 2024. This likely reflects a higher mix of lower-cost digital services or favorable licensing agreements. When compared to peers like Bilibili (36.6% gross margin), NetEase's profitability profile is in a different tier, suggesting potent pricing power and a highly efficient content monetization engine. The challenge will be sustaining this level as revenue mix evolves.

Exceptional Operating Leverage Driving Profit Surge

Operating margin expanded to 40.2% in 2026Q2, nearly doubling from the 27-29% range prevalent throughout 2024, demonstrating powerful operating leverage as revenue grew.

The operating leverage is striking; operating income grew from $7.0B in 2024Q2 to $12.1B in 2026Q2 on only a 17.6% revenue increase over the same period. This has been achieved through disciplined control of SG&A expenses, which have remained largely flat in absolute terms despite revenue growth, and a modest reduction in R&D as a percentage of sales. The resulting operating margin of 40.2% is vastly superior to peers like Baidu (8.0%) and Bilibili (3.7%), indicating best-in-class expense management.

Net Income Volatility Masks Underlying Strength

Net income has been highly volatile, swinging from $6.2B in 2025Q4 to $10.7B in 2026Q1 and back to $7.0B in 2026Q2, despite relatively stable operating income trends.

The significant disconnect between operating income stability and net income volatility points to large non-operating items impacting the bottom line. For instance, the $10.7B net income in 2026Q1 was accompanied by a minimal $616M stock-based compensation charge, while 2025Q3 saw $902M in SBC yet still delivered strong net income. This suggests material fluctuations in items like investment gains, tax provisions, or other income are obscuring the core operational earnings power, requiring investors to focus on operating metrics for a clearer view.

Fixed Cost Discipline Amidst Revenue Growth

SG&A expenses remained remarkably stable between $3.7B and $5.6B across all quarters, while revenue grew, indicating effective control over selling and administrative overhead.

The company has demonstrated strong cost discipline, particularly in SG&A, which has not scaled linearly with revenue growth. R&D spending has also been tightly managed, hovering around $4.4B-$4.6B per quarter. This fixed-cost behavior, combined with expanding gross margins, is the primary driver behind the operating margin expansion. The primary risk is whether this tight control can be maintained without stifling innovation in a competitive gaming landscape.

Sustainability of Margin Peak in Question

The leap to a 70% gross margin and 40% operating margin represents a significant step-change from historical levels, raising questions about its sustainability if market conditions or competitive dynamics shift.

A short-seller would focus on whether these expanded margins are a cyclical peak rather than a new structural baseline. The rapid improvement from 2024 lows could be tied to favorable one-time factors in content costs or product mix that may not persist. Furthermore, maintaining a 40% operating margin in the highly competitive Chinese tech sector is exceptional; any increase in marketing spend to defend market share or higher investment in new game development could quickly compress these profitability metrics back toward historical norms.

NTES — Frequently Asked Questions

Quick answers to the most common questions about buying NTES stock.

What was NetEase, Inc.'s (NTES) revenue in 2025?

For fiscal year 2025, NetEase, Inc. (NTES) reported total revenue of $112.63B. This represents a 721020.8% increase compared to $15.6M in 1999.

Is NetEase, Inc. (NTES) profitable?

NetEase, Inc. (NTES) is profitable, generating $33.76B in net income for the fiscal year ending 2025 with a net profit margin of 30.0%.

What is NetEase, Inc.'s operating profit margin?

NetEase, Inc. (NTES) reported an operating income of $35.83B, resulting in an operating profit margin of 31.8%. This margin reflects the operational efficiency of the business before interest and taxes.

What is NetEase, Inc.'s gross profit and gross margin?

NetEase, Inc. (NTES) generated $72.40B in gross profit for the year, representing a gross profit margin of 64.3%. This demonstrates the company's core pricing power and production efficiency.