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NetEase Inc (NTES) reported first-quarter FY21 revenue growth of 20.2% year-on-year to $3.13 billion (RMB20.5 billion), beating the analyst consensus of $3.11 billion.

Revenues from Online game services rose 10.8% Y/Y to S$2.3 billion (RMB15.0 billion), Youdao increased 147.5% Y/Y to $204.5 million (RMB1.3 billion), Innovative businesses and others' rose 39.7% Y/Y to $640.4 million (RMB4.2 billion).

Gross profit rose 17.9% Y/Y to $1.7 billion (RMB11.1 billion), but the gross margin declined 110 basis points to 53.9%.

The gross profit margin for online game services expanded 50 basis points to 64.6%, Youdao expanded 1,380 basis points to 57.3%, and innovative businesses and others contracted 140 basis points to 14.4%.

Non-GAAP net income was $775.5 million (RMB5.1 billion), with the adjusted EPS of $1.14 per ADS beating the analyst consensus of $0.97. The board approved a dividend of $0.06 per share ($0.30 per ADS), up 29.3% Y/Y for Q1. NetEase held $16.2 billion (RMB106.25 billion) in cash and equivalents and generated $846 million (RMB5.54 billion) from operating cash flow.

On February 25, 2021, the board had approved a share repurchase program of up to $2 billion for 24 months, beginning on March 2, 2021.

Price action: NTES shares traded higher by 2.76% at $107.8 in the premarket session on the last check Tuesday.