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: 6.8997 USD 0%
Market Cap: 62m 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
63.4m USD
-18%
-134%
11%
US
Activision Blizzard Inc
LSE:0H8X
74.1B USD
70%
26%
25%
JP
Nintendo Co Ltd
TSE:7974
8.8T JPY
57%
27%
27%
CN
NetEase Inc
NASDAQ:NTES
50B USD
63%
27%
27%
SG
Sea Ltd
NYSE:SE
45.7B USD
42%
0%
-1%
US
Electronic Arts Inc
NASDAQ:EA
38.6B USD
78%
20%
16%
US
Roblox Corp
NYSE:RBLX
30.7B USD
77%
-38%
-34%
US
Take-Two Interactive Software Inc
NASDAQ:TTWO
26.6B USD
56%
-7%
-70%
JP
Nexon Co Ltd
TSE:3659
2.2T JPY
64%
29%
16%
JP
Konami Holdings Corp
TSE:9766
1.8T JPY
45%
23%
17%
KR
Krafton Inc
KRX:259960
15.4T KRW
0%
42%
38%
Country CN
Market Cap 63.4m 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 8.8T JPY
Gross Margin
57%
Operating Margin
27%
Net Margin
27%
Country CN
Market Cap 50B USD
Gross Margin
63%
Operating Margin
27%
Net Margin
27%
Country SG
Market Cap 45.7B USD
Gross Margin
42%
Operating Margin
0%
Net Margin
-1%
Country US
Market Cap 38.6B USD
Gross Margin
78%
Operating Margin
20%
Net Margin
16%
Country US
Market Cap 30.7B USD
Gross Margin
77%
Operating Margin
-38%
Net Margin
-34%
Country US
Market Cap 26.6B USD
Gross Margin
56%
Operating Margin
-7%
Net Margin
-70%
Country JP
Market Cap 2.2T JPY
Gross Margin
64%
Operating Margin
29%
Net Margin
16%
Country JP
Market Cap 1.8T JPY
Gross Margin
45%
Operating Margin
23%
Net Margin
17%
Country KR
Market Cap 15.4T KRW
Gross Margin
0%
Operating Margin
42%
Net Margin
38%

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
63.4m USD
16%
4%
-203%
-59%
US
Activision Blizzard Inc
LSE:0H8X
74.1B USD
11%
8%
9%
13%
JP
Nintendo Co Ltd
TSE:7974
8.8T JPY
16%
13%
16%
32%
CN
NetEase Inc
NASDAQ:NTES
50B USD
24%
16%
22%
42%
SG
Sea Ltd
NYSE:SE
45.7B USD
-3%
-1%
0%
1%
US
Electronic Arts Inc
NASDAQ:EA
38.6B USD
16%
9%
14%
12%
US
Roblox Corp
NYSE:RBLX
30.7B USD
-743%
-18%
-39%
-32%
US
Take-Two Interactive Software Inc
NASDAQ:TTWO
26.6B USD
-51%
-27%
-3%
-3%
JP
Nexon Co Ltd
TSE:3659
2.2T JPY
7%
6%
11%
12%
JP
Konami Holdings Corp
TSE:9766
1.8T JPY
16%
11%
17%
21%
KR
Krafton Inc
KRX:259960
15.4T KRW
16%
13%
16%
21%
Country CN
Market Cap 63.4m 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 8.8T JPY
ROE
16%
ROA
13%
ROCE
16%
ROIC
32%
Country CN
Market Cap 50B USD
ROE
24%
ROA
16%
ROCE
22%
ROIC
42%
Country SG
Market Cap 45.7B USD
ROE
-3%
ROA
-1%
ROCE
0%
ROIC
1%
Country US
Market Cap 38.6B USD
ROE
16%
ROA
9%
ROCE
14%
ROIC
12%
Country US
Market Cap 30.7B USD
ROE
-743%
ROA
-18%
ROCE
-39%
ROIC
-32%
Country US
Market Cap 26.6B USD
ROE
-51%
ROA
-27%
ROCE
-3%
ROIC
-3%
Country JP
Market Cap 2.2T JPY
ROE
7%
ROA
6%
ROCE
11%
ROIC
12%
Country JP
Market Cap 1.8T JPY
ROE
16%
ROA
11%
ROCE
17%
ROIC
21%
Country KR
Market Cap 15.4T KRW
ROE
16%
ROA
13%
ROCE
16%
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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