Shares of NetEase (NASDAQ: NTES) rose on Thursday after the Chinese internet company reported its second-quarter results. While revenue came in slightly below analyst expectations, adjusted earnings easily beat estimates. The stock was up about 6.8% at noon EDT, after having risen as much as 13.5% earlier in the day.
NetEase reported second-quarter revenue of $2.73 billion, up 15.3% year over year but $20 million below the average analyst estimate.
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Online game services produced revenue of $1.67 billion, up 13.6% year over year; e-commerce produced revenue of $764.3 million, up 20.2% year over year; advertising services produced revenue of $84.7 million, down 8.3% year over year; and innovative businesses and other produced revenue of $219.5 million, up 23.2% year over year.
The gaming business performed well despite seasonal pressures: "Despite a seasonally slower period in the second quarter, the steady performance of our game portfolio marks the fifth consecutive quarter that we have exceeded RMB10 billion in online game revenues," said CFO Charles Zhaoxuan Yang during the earnings call.
Adjusted earnings per American depositary share (ADS) came in at $4.09, up from $3.04 in the prior-year period and $1.40 higher than analysts were expecting.
Along with its Q2 results, NetEase announced a quarterly dividend of $1.04 per ADS, payable on Aug. 30 to shareholders of record on Aug. 23. The company also provided an update on its $1 billion share repurchase program, saying that no American depositary shares had been repurchased as of June 30.
While NetEase missed expectations for revenue, substantial earnings growth was enough to send the stock higher.
This article was originally published on Fool.com