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NTES: Expect Strong 4Q23 Performance Driven By New And Existing Games As Well As Overseas Expansion

NTES will report 4Q23 results on February 29^th before the markets open with a 7am ET conference call. We are positive on NTES’s 4Q23 performance. The positive performance, we believe, is driven by the better performance from both domestic and international markets. Internationally, over the last two years, NTES has developed 22 overseas game studios. We expect NTES to have more overseas studios set up in 2024. Domestically, we believe existing PC games contributed more to the bottom line in 4Q23, while newly launched mobile games contributed more to the top-line growth. NetEase has released 5 new games since June 2023, including the well-received Justice Mobile, Dunk City Dynasty, and Racing Master, which are expected to make meaningful revenue contributions in 4Q23. NTES has a rich game pipeline with more than 50 games, and more than 20 games have already gained licenses from the government. We believe a strong pipeline is likely to sustain NTES’s future growth.