Golden Wubei Financial News | Goldman Sachs issued a research report stating that Netease (09999) performed better than expected in the third quarter of this year, with strong momentum in PC game and deferred revenue growth being bullish factors for the quarter. Although the firm believes that Netease's growth in the fourth quarter will remain modest due to a lack of new mobile game contributions, it thinks the turning point is near and that several new games will be launched before the end of the year, providing better visibility for 2025.

The firm adjusted Netease's revenue forecast for 2024-2026 to a range of -0.1% to +0.8%, mainly reflecting the rebound of "Blizzard" and improved channel visibility, resulting in better-than-expected PC game revenues. At the same time, due to the continuous expansion of Netease's gross margin and good management of operating expenses, Goldman Sachs raised its net profit forecast by 1.1% to 2.1%.

Based on SOTP valuation, the target price was raised from HKD 166 to HKD 169. The "buy" rating is reaffirmed, with expectations for revenue and profit to grow in the high single digits for 2025.