UBS: Expected NetEase Cloud Music ARPPU can regain growth, maintaining "buy" rating.

UBS released a research report stating that NetEase Cloud Music's online music business revenue increased by 8% year-on-year, while profitability met expectations. The subscriber mix shifted towards lower-priced 88VIP and student memberships, and the increase in subscriber numbers remained healthy, with the bank estimating a 16% year-on-year growth. The bank also expects limited impact from new competitors on the company's subscriber conversion, and therefore still predicts a 14% year-on-year growth in the online music business in 2026, maintaining a "buy" rating. Looking ahead to 2026, management reiterated its focus on expanding its user and subscriber base through high-quality and differentiated content, with the goal of increasing both the number of subscribers and ARPPU.