Core Viewpoint - NetEase Cloud Music reported a revenue of 3.827 billion yuan for H1 2025, a year-on-year decrease of 6%, while adjusted net profit reached 1.946 billion yuan, a year-on-year increase of 121%, exceeding Bloomberg's consensus median expectation of 839 million yuan, primarily due to effective cost control [1][2] Revenue Performance - Online music revenue grew by 15.9% year-on-year to 2.967 billion yuan, with subscription revenue at 2.470 billion yuan, up 15.2%, driven by an increase in subscription membership, slightly offset by a dilution in monthly ARPU due to changes in membership structure [1] - Non-subscription revenue increased by 19.7%, likely driven by growth in advertising revenue and album sales [1] - Social entertainment business revenue decreased by 43.1% due to product interface optimization, but is expected to stabilize moving forward [1] Profitability and Cost Control - Gross margin improved by 1.4 percentage points year-on-year to 36.4%, surpassing Bloomberg's consensus median of 35.4%, mainly due to a decline in social entertainment revenue sharing and effective content licensing cost control [2] - Selling expenses decreased by 55.8% year-on-year from 369 million yuan to 163 million yuan, with promotional and advertising expenses dropping significantly due to a more cautious promotional strategy [2] - Operating profit increased by 40.8% year-on-year to 845 million yuan, confirming sustainable profitability [2] Future Outlook and Valuation - Adjusted net profit for 2025, 2026, and 2027 is projected to be 3.091 billion yuan, 2.656 billion yuan, and 2.983 billion yuan, reflecting upward revisions of 61%, 29%, and 36% respectively [2] - The company is switching from DCF to PE valuation, assigning a target price of 360.42 HKD based on a 26.86x PE for 2026 adjusted net profit, maintaining a "Buy" rating [2]
网易云音乐(9899.HK)：盈利超预期 经营杠杆持续释放