Original title: Nomura: Lowering NetEase (09999) Target Price to 169 Yuan to Maintain “Buy” Rating Source: Zhitong Financial Network

The Zhitong Finance app learned that Nomura published a report to reduce the target price of NetEase (09999) by 2% from 173 yuan to 169 yuan, and the rating remained “buy.”

According to the report, most of the company's cash balance is denominated in US dollars. The US dollar depreciated rapidly against the renminbi in the third quarter, and there was a foreign exchange loss at the end of the third quarter. Therefore, NetEase is expected to have a non-GAAP profit of 0.57 yuan per share for the third quarter, which is lower than the market's general estimate of 1.23 yuan.

However, Nomura expects total revenue in the third quarter to rise 24% to 18.1 billion yuan, with online game revenue rising 19% to 13.8 billion yuan. In addition, under non-GAAP, the operating profit margin decreased by 9 percentage points to 17.6%, mainly due to subsidiaries increasing marketing expenses, and consolidated marketing expenses increased 121% year over year.