NTES(NTES) - 2024 Q1 - Quarterly Report

Financial Performance - Net revenues for Q4 2023 were RMB27.1 billion (US$3.8 billion), a 7.0$2.9 billion), up 9.6% compared to Q4 2022[4] - Gross profit for Q4 2023 was RMB16.8 billion (US$2.4 billion), representing a 27.0$927.1 million), down from RMB7.8 billion in the previous quarter[10] - Non-GAAP net income from continuing operations for Q4 2023 was RMB7.4 billion (US$1.0 billion), compared to RMB8.6 billion in the previous quarter[41] - For fiscal year 2023, net revenues were RMB103.5 billion (US$14.6 billion), an increase from RMB96.5 billion in fiscal year 2022[42] - Net income attributable to the Company's shareholders for fiscal year 2023 totaled RMB29.4 billion (US$4.1 billion), a 45.1$4.6 billion), up 42.9% from RMB22.8 billion in fiscal year 2022[53] - Basic net income per share for the year ended December 31, 2023, was 9.15, compared to 6.23 in 2022, marking a 46.1% increase[73] - The company reported a net income from continuing operations of RMB 29,357,223 for the year ended December 31, 2023, up from RMB 19,218,426 in 2022[73] - Net income for the year ended December 31, 2023, was RMB 29,357,223, representing a significant increase from RMB 19,843,290 for the year ended December 31, 2022, reflecting a growth of approximately 48%[77] Revenue Breakdown - Net revenues from innovative businesses and others for Q4 2023 were RMB2.8 billion (US$387.7 million), a 12.9$279.7 million), a 16.4% decrease compared to Q4 2022[6] - Youdao's net revenues for Q4 2023 were RMB 1.48 billion, a slight decrease from RMB 1.45 billion in Q4 2022[78] - Total net revenues for the year ended December 31, 2023, reached RMB 103.47 billion, a 7.2% increase from RMB 96.50 billion in 2022[78] Profitability Metrics - The gross profit margin for games and related value-added services was 69.5% in Q4 2023, up from 59.1% in Q4 2022[28] - Gross profit for the year ended December 31, 2023, was RMB 63,063,394, up 19.5% from RMB 52,766,126 in 2022[73] - Operating profit for the year ended December 31, 2023, was RMB 27,709,144, reflecting a 41.4% increase compared to RMB 19,628,593 in 2022[73] - Cloud Music's gross profit margin improved to 30.3% in Q4 2023, up from 17.8% in Q4 2022[78] Expenses and Cash Flow - Total operating expenses for Q4 2023 were RMB10.0 billion (US$1.4 billion), a 13.0$5.0 billion), compared to RMB27.7 billion for fiscal year 2022, reflecting a 27.4% increase[54] - Cash flows from operating activities for the three months ended September 30, 2023, were RMB 9,843,920, compared to RMB 9,009,213 for the same period in 2022, indicating an increase of about 9%[77] Shareholder Returns - The Company initiated a share repurchase program of up to US$5.0 billion, with approximately 7.2 million ADSs repurchased for a total cost of US$644.1 million as of December 31, 2023[56] - The company declared a dividend of US$0.21597 per share for Q4 2023, payable on March 25, 2024[91] - The company paid dividends totaling RMB 2,423,355 to shareholders for the three months ended September 30, 2023, compared to RMB 2,018,984 for the same period in 2022[77] Balance Sheet Highlights - Net cash as of December 31, 2023, reached RMB110.9 billion (US$15.6 billion), an increase from RMB95.6 billion as of December 31, 2022[54] - Total assets increased to RMB185.9 billion (US$26.2 billion) as of December 31, 2023, up from RMB172.8 billion as of December 31, 2022[71] - Shareholders' equity rose to RMB124.3 billion (US$17.5 billion) as of December 31, 2023, compared to RMB104.7 billion as of December 31, 2022[71] Future Outlook - The company plans to continue its market expansion and product innovation strategies in 2024[78] - The Company’s management will host a teleconference call on February 29, 2024, to discuss quarterly results and answer questions[58]