NEW YORK (AP) ¿ NetEase.com Inc., an Internet and online game services provider in China, said Wednesday its first-quarter profit and revenue jumped sharply, boosted by strong user loyalty for its games and "robust online communities." The quarter's sales, however, were still slightly below Wall Street's expectations, due to lackluster advertising revenue. NetEase posted a profit of 416.7 million renminbi ($61 million), up 55 percent from $269.4 million renminbi a year earlier. Earnings per American Depositary share were 47 cents per share in the latest quarter. Revenue rose 20 percent to 781.7 million renminbi ($114.4 million) from 651.9 million renminbi. Analysts, on average, were expecting a profit of 46 cents per ADS on sales of $116.3 million, according to a poll by Thomson Reuters. The company's online game revenue made up the bulk of the quarter's sales. It totaled 724 million renminbi, or $106 million. NetEase said while advertisers remained cautious during quarter, the Chinese government's stimulus measures helped deliver "some initial signs of recovery."
Earlier this year, NetEase won a three-year license from Activision Blizzard Inc. to run "World of Warcraft," the world's most popular multiplayer online game, in mainland China once a previous license deal with a competitor ends. Roth Capital Partners analyst Adam Krejcik kept a "Hold" rating on NetEase and said while online advertising was weak, the company's cost controls and a lower tax rate helped boost earnings per share. The company's U.S.-traded shares fell $1.28, or 4.2 percent, to $29.30 in afternoon trading. In the past 52 weeks, the stock has traded between $15 and $32.65.