Is the business good?
How good a business is NTES?
NetEase, Inc. earns 31% on the capital it employs against a 9.0% cost of capital, so the business is worth more the bigger it gets.
31%
Return on invested capital · cost of capital 9.0% · 22 points above what the capital costs: growth creates value
- Operating margin
- 32%
Operating margin · Communication Services median 12% · fiscal year to FY2025
- Cash conversion
- 1.43×
Cash conversion · 1.27× a year ago · every dollar of reported profit arrived as cash, and more
- Share count, year on year
- −0.38%
Share count, year on year · flat: no meaningful dilution
| Year | Operating margin |
|---|---|
| FY2020 | 20% |
| FY2021 | 19% |
| FY2022 | 20% |
| FY2023 | 27% |
| FY2024 | 28% |
| FY2025 | 32% |
Details›
- Gross marginfiscal year to FY2025
- 64%
- Operating marginfiscal year to FY2025
- 32%
- Net marginfiscal year to FY2025
- 31%
- Free cash flow margin
- 44%
- R&D as % of revenue
- 16%
- Revenue, trailing twelve months
- $112.6B
- Free cash flow, trailing twelve months
- $49.7B
- Net income, trailing twelve months
- $34.8B
- Return on invested capitaloperating profit after tax ÷ debt + equity − cash
- 31%
Margins, capital and share counts from the statements as filed with the SEC; cash conversion from the cash flow statement.
Communication Services
Ranks #13 of 100 by Smart Score