From Investor's Business Daily's article, "But sales excluding taxes rose 11% to $346.6 million, missing Wall Street's forecast for $348.1 million."
Wall Street say NTES missed the top line.
Total revenue is 363.6M and Total Net Revenue is 346.6M. The difference is 17M in sales tax.
But if you look at the company's announcement, "...The increase in sales taxes was mainly due to a change in the tax ruels in China,... As the increase in value-added tax was substantially offset by a reduction in business taxes.... this change in the tax rules in China did not have a significant impact on gross profit of the Company's online game services business segment..."
Or, in other words, Chinese government is starting to convert some income tax into sales tax. The overall tax stay the same. Sales tax increases while income tax decrease by about the same level.
But Sales tax is deducted in the calculation of Total Net Revenue.
The total tax stayed the same.
Thus, comparing of Total Net Revenue is just an accounting mirage, and NTES is being penalized for it.
NTES had a great quarter and beat the revenue by a great deal. But due to an accounting illusion, people think it under-performs in revenue.