NetEase ADRs Hit 52-Week Low After Second-Quarter Earnings Report

1 min read | August 22, 2024 11:00 AM PDT | By Team Kalkine Media

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NetEase ADRs Hit 52-Week Low After Second-Quarter Earnings Report — Image source: Shutterstock

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NetEase, a major player in the Communication Sector, saw its American depositary receipts (ADRs) reach a 52-week low on Thursday following the release of its second-quarter financial results. The company's ADRs fell by 12% during early afternoon trading, settling at $81.24. Trading volume surged to 4.1 million, significantly surpassing the 65-day average volume of 1.6 million ADRs. Earlier in the session, the ADRs had dropped to $81.18, marking the lowest point in the past year.

Financial Performance for Q2

For the second quarter, NetEase (NASDAQ:NTES) reported a net income of 6.76 billion yuan (approximately $930 million), which represents a decline from the 8.24 billion yuan recorded in the same period the previous year. Despite this drop in net profit, the company's revenue for the second quarter increased to 25.49 billion yuan from 24 billion yuan a year earlier.

Additionally, NetEase reported a rise in gross profit, which amounted to 16 billion yuan for the second quarter of 2024, compared to 14.4 billion yuan for the same quarter in 2023.

Market Reaction

The decline in net profit and the subsequent drop in ADRs reflect investor reaction to the company's latest earnings report. The increase in revenue and gross profit, however, highlights some positive aspects of NetEase's financial performance.

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