7 Most Profitable Gaming Stocks To Invest In

4. NetEase Inc. (NASDAQ:NTES)

TTM Net Income: $4 Billion

5-Year Net Income CAGR: 26.92%

Number of Hedge Fund Holders: 35

NetEase Inc. (NASDAQ:NTES) is a Chinese technology company that specializes in gaming, education, and e-commerce. Its diverse portfolio includes popular mobile and PC games that appeal to both local and international audiences. Over the years, the company has successfully expanded its offerings by developing its own games and collaborating with global partners.

NetEase Inc. (NASDAQ:NTES) is launching new titles as it focuses on growing its gaming business. Its recently launched multiplayer survival game, Once Human, quickly attracted over 230,000 concurrent players shortly after launch, ranking among the top five games on Steam in July. Following an update in August, it reached the top of Steam’s best-seller chart in 12 countries and accumulated over 10 million downloads. In July, the company launched Naraka: Bladepoint Mobile, a battle royale game that features fast-paced combat and a unique AI co-pilot system. This title achieved the third spot on the iOS grossing chart shortly after its release.

Financially, the company is performing well. In the second quarter of 2024, NetEase Inc. (NASDAQ:NTES) reported net revenue of $3.5 billion, a 6% increase year-over-year. Revenue from games and related services rose by 7%, driven largely by mobile titles like Identity V and Justice Mobile. Mobile games contributed about 76.4% of total online game revenue, highlighting their importance to the company’s growth.

NTES is one of the most profitable gaming stocks to invest in. Over the past five years, the company has achieved a compound annual growth rate (CAGR) of 16.57% in revenue and 26.92% in net income.

NetEase Inc.’s (NASDAQ:NTES) commitment to innovation and community engagement positions it favorably in the competitive gaming market. According to Insider Monkey’s Q2 database of over 900 hedge funds, 35 hedge funds held stakes in NetEase Inc. (NASDAQ:NTES). As of June 30, Orbis Investment Management holds 1.9 million shares of the company, valued at $182.28 million, making it NetEase Inc.’s (NASDAQ:NTES) most prominent shareholder.