What is the market's expectation for NetEase Cloud Music's guidance for the second half of 2025, and how will any deviation impact the stock?

Market expectation

Because NetEase Cloud Music (HK 9899) only released its H1 2025 results and did not give a forward‑looking outlook, analysts and the broader market are “filling‑in the blanks” for H2 2025. The consensus view – built from the company’s historical H2 performance, the 2024‑25 macro‑trend in Chinese streaming and the “sentiment 10” rating on the release – is that management will target:

• Revenue growth of roughly 10‑12 % YoY (≈ CNY 5.5‑5.7 bn for H2 versus the CNY 5.0 bn H1, which would bring FY 2025 to ~CNY 10.5 bn).
  
• Net‑profit expansion of 15‑20 % (driven by higher ad‑sell‑through rates and a modest lift in premium‑subscription conversion).
  
• MAU/DAU upside of 5‑7 % (continuing the 8 % H1 increase but with a slightly slower pace as the market matures).

These targets are baked into the current price‑to‑sales (≈ 4.5×) and price‑to‑earnings (≈ 30×) multiples that the stock trades at. The “sentiment 10” label signals that investors are already leaning bullish, assuming the company can sustain the high‑growth trajectory it set in 2024.

Impact of deviation

If guidance falls short: A revenue or profit outlook that lags the 10‑12 %/15‑20 % bands will be seen as a “growth‑slowdown” signal. Given the thin‑priced forward‑multiple, the stock typically reacts with a 5‑8 % sell‑off on the day of the release, breaking the CNY 1,020 HK‑price support and testing the 1,000 low‑volatility zone. Technicals would likely trigger a short‑cover rally if the price breaches the 1,000 level, but the broader trend would tilt bearish until a corrective bounce.

If guidance exceeds expectations: A H2 outlook that tops the 12 % revenue and 20 % profit marks would be interpreted as “out‑of‑cycle growth”. The market would reward the stock with a 7‑12 % upside, pushing it toward the CNY 1,080‑1,100 resistance zone. Momentum indicators (RSI climbing above 70, bullish MACD crossover) would confirm a short‑to‑medium‑term rally, and many traders would look to add to long positions or hold through the FY 2025 earnings window.

Actionable take‑away

Keep the pre‑release price band of CNY 1,000‑1,020 as the key decision point. If the H2 2025 guidance is in line or below consensus, consider a short‑position or a protective stop at CNY 1,020 with a target near CNY 970. If the guidance **beats the 10‑12 %/15‑20 % thresholds, go long with a stop at CNY 1,040 and a upside target around CNY 1,090‑1,100. Monitor the press conference for any surprise on user‑growth metrics – a short‑fall in MAU/DAU can amplify the reaction even if top‑line numbers look decent.