PEKING (dpa-AFX) - NetEase Inc. (NTES), a Chinese online games website operator, Wednesday reported an increase in profit for the first quarter, driven mainly by online game sales growth.
China is the biggest internet market in the world in terms of users. NetEase has been able to capitalize on this and has improved its revenues in the past few quarters. For the recent first quarter, online games revenues increased 31.4 percent year-over-year, helped by the company's self-developed games, Ghost, Tianxia III, Fantasy Westward Journey, Westward Journey Online II and Heroes of Tang Dynasty.
Chief Executive William Ding said, 'The growing popularity of our self-developed games continues to drive our revenues.'
Revenues from online games were 1.8 billion yuan or $289.2 million, compared to 1.4 billion last year.
NetEase's advertising revenues grew 13.1 percent year-over-year, with automobile, Internet services and food and beverage services as the top performing sectors. However, advertising revenues declined 48.5 percent from previous quarter, which the company blamed the 'typical industry seasonality.'
Ding assured by stating, 'We expect the usual uptick in advertising revenues in the second quarter and through the second half of 2012.'
NetEase said its total revenues for the first quarter grew to 2.0 billion yuan from 1.5 billion yuan last year. On a U.S dollar basis, revenues for the quarter were $318.2 million.
Beijing-based NetEase's first-quarter profit improved to 941.7 million yuan or $149.5 million, from 737.4 million yuan in the year ago quarter. Earnings per ADS was $1.14 compared to $0.89 in the prior year quarter.
On average, analysts polled by Thomson Reuters expected earnings of $1.01 per share on revenues of $310.19 million for the quarter. Analysts' estimates typically exclude special items for the quarter.
NTES closed Wednesday's trading at $57.69, up $0.91 or 1.60% on a volume of 0.6 million shares. In after hours, the stock further gained $1.31 or 2.27%.
Copyright RTT News/dpa-AFX
© 2012 AFX News
