NCTY Profitability Analysis: Past Growth, Margins, Return on Capital, Free Cash Flow, and more - The9 Ltd - Alpha Spread

The9 Ltd
NASDAQ:NCTY

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The9 Ltd
NASDAQ:NCTY
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Price: 8.5999 USD 1.06%
Market Cap: 77.3m USD
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Profitability Summary

24/100
Profitability
Score

We take all the information about a company's profitability (such as its margins, capital efficiency, free cash flow generating ability, and more) and consolidate it into one single number - the profitability score. The higher the profitability score, the more profitable the company is.

Past Growth

To be successful and remain in business, both growth and profitability are important and necessary. Net Income growth is often seen as a sign of a company's efficiency from an operational standpoint, but is influenced heavily by a company's goals and challenges and should therefore be assessed in conjunction with other metrics like revenue and operating income growth.

Margins

Profit margins represent what percentage of sales has turned into profits. Simply put, the percentage figure indicates how many cents of profit the company has generated for each dollar of sale.

Profit margins help investors assess if a company's management is generating enough profit from its sales and whether operating costs and overhead costs are being contained.

Earnings Waterfall
The9 Ltd

Revenue
179m CNY
Cost of Revenue
-211.9m CNY
Gross Profit
-32.8m CNY
Operating Expenses
-206.8m CNY
Operating Income
-239.6m CNY
Other Expenses
259.6m CNY
Net Income
20m CNY

Margins Comparison
The9 Ltd Competitors

Country Company Market Cap Gross
Margin
Operating
Margin
Net
Margin
CN
The9 Ltd
NASDAQ:NCTY
77.3m USD
-18%
-134%
11%
US
Activision Blizzard Inc
LSE:0H8X
74.1B USD
70%
26%
25%
JP
Nintendo Co Ltd
TSE:7974
9.2T JPY
57%
27%
27%
SG
Sea Ltd
NYSE:SE
57B USD
42%
0%
-1%
CN
NetEase Inc
NASDAQ:NTES
56.9B USD
63%
27%
27%
US
Electronic Arts Inc
NASDAQ:EA
38B USD
78%
20%
16%
US
Take-Two Interactive Software Inc
NASDAQ:TTWO
27.2B USD
56%
-7%
-70%
US
Roblox Corp
NYSE:RBLX
26.9B USD
77%
-38%
-34%
JP
Nexon Co Ltd
TSE:3659
2.3T JPY
64%
29%
16%
CN
Bilibili Inc
NASDAQ:BILI
14.9B USD
27%
-16%
-17%
JP
Konami Holdings Corp
TSE:9766
2T JPY
45%
23%
17%
Country CN
Market Cap 77.3m USD
Gross Margin
-18%
Operating Margin
-134%
Net Margin
11%
Country US
Market Cap 74.1B USD
Gross Margin
70%
Operating Margin
26%
Net Margin
25%
Country JP
Market Cap 9.2T JPY
Gross Margin
57%
Operating Margin
27%
Net Margin
27%
Country SG
Market Cap 57B USD
Gross Margin
42%
Operating Margin
0%
Net Margin
-1%
Country CN
Market Cap 56.9B USD
Gross Margin
63%
Operating Margin
27%
Net Margin
27%
Country US
Market Cap 38B USD
Gross Margin
78%
Operating Margin
20%
Net Margin
16%
Country US
Market Cap 27.2B USD
Gross Margin
56%
Operating Margin
-7%
Net Margin
-70%
Country US
Market Cap 26.9B USD
Gross Margin
77%
Operating Margin
-38%
Net Margin
-34%
Country JP
Market Cap 2.3T JPY
Gross Margin
64%
Operating Margin
29%
Net Margin
16%
Country CN
Market Cap 14.9B USD
Gross Margin
27%
Operating Margin
-16%
Net Margin
-17%
Country JP
Market Cap 2T JPY
Gross Margin
45%
Operating Margin
23%
Net Margin
17%

Return on Capital

Return on capital ratios give a sense of how well a company is using its capital (equity, assets, capital employed, etc.) to generate profits (operating income, net income, etc.). In simple words, these ratios show how much income is generated for each dollar of capital invested.

Return on Capital Comparison
The9 Ltd Competitors

Country Company Market Cap ROE ROA ROCE ROIC
CN
The9 Ltd
NASDAQ:NCTY
77.3m USD
16%
4%
-203%
-59%
US
Activision Blizzard Inc
LSE:0H8X
74.1B USD
11%
8%
9%
13%
JP
Nintendo Co Ltd
TSE:7974
9.2T JPY
16%
13%
16%
32%
SG
Sea Ltd
NYSE:SE
57B USD
-3%
-1%
0%
1%
CN
NetEase Inc
NASDAQ:NTES
56.9B USD
24%
16%
22%
42%
US
Electronic Arts Inc
NASDAQ:EA
38B USD
16%
9%
14%
12%
US
Take-Two Interactive Software Inc
NASDAQ:TTWO
27.2B USD
-51%
-27%
-3%
-3%
US
Roblox Corp
NYSE:RBLX
26.9B USD
-743%
-18%
-39%
-32%
JP
Nexon Co Ltd
TSE:3659
2.3T JPY
7%
6%
11%
12%
CN
Bilibili Inc
NASDAQ:BILI
14.9B USD
-27%
-12%
-22%
-26%
JP
Konami Holdings Corp
TSE:9766
2T JPY
16%
11%
17%
21%
Country CN
Market Cap 77.3m USD
ROE
16%
ROA
4%
ROCE
-203%
ROIC
-59%
Country US
Market Cap 74.1B USD
ROE
11%
ROA
8%
ROCE
9%
ROIC
13%
Country JP
Market Cap 9.2T JPY
ROE
16%
ROA
13%
ROCE
16%
ROIC
32%
Country SG
Market Cap 57B USD
ROE
-3%
ROA
-1%
ROCE
0%
ROIC
1%
Country CN
Market Cap 56.9B USD
ROE
24%
ROA
16%
ROCE
22%
ROIC
42%
Country US
Market Cap 38B USD
ROE
16%
ROA
9%
ROCE
14%
ROIC
12%
Country US
Market Cap 27.2B USD
ROE
-51%
ROA
-27%
ROCE
-3%
ROIC
-3%
Country US
Market Cap 26.9B USD
ROE
-743%
ROA
-18%
ROCE
-39%
ROIC
-32%
Country JP
Market Cap 2.3T JPY
ROE
7%
ROA
6%
ROCE
11%
ROIC
12%
Country CN
Market Cap 14.9B USD
ROE
-27%
ROA
-12%
ROCE
-22%
ROIC
-26%
Country JP
Market Cap 2T JPY
ROE
16%
ROA
11%
ROCE
17%
ROIC
21%

Free Cash Flow

Free cash flow (FCF) is the money a company has left over after paying its operating expenses and capital expenditures. The more free cash flow a company has, the more it can allocate to dividends, paying down debt, and growth opportunities.

If a company has a decreasing free cash flow, that is not necessarily bad if the company is investing in its growth.

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