Bilibili continues to move towards the goal of reducing losses.
On August 22nd, Bilibili (Nasdaq: BILI, 09626. HK, hereinafter referred to as "Bilibili") released its unaudited financial report for the second quarter ended June 30th. In the second quarter, the total revenue of Bilibili increased by 16% year-on-year, reaching 6.13 billion yuan. Net loss of 608 million yuan, a year-on-year decrease of 61%; After adjustment, the net loss was 271 million yuan, a year-on-year decrease of 72%.
The total revenue of Bilibili in the first half of the year was 11.79 billion yuan, an increase of 14% year-on-year; The net loss was 1.37 billion yuan, a year-on-year decrease of 37%; After adjustment, the net loss was 720 million yuan, a year-on-year decrease of 64%.
More than 70% of young people in China are using Bilibili, and the average age of our users is already 25 years old. This age group is in a stage of rapid growth and release of consumer demand and purchasing power, "said Bilibili CEO Chen Rui during a conference call after the financial report.
On the profit target of external attention, Bilibili executives stated that with the growth of advertising and gaming businesses, there is still significant room for improvement in gross profit margin. The company is expected to achieve breakeven in the third quarter, in addition to achieving "meaningful profits" under non GAAP accounting standards.
The most noteworthy highlight of Bilibili this quarter is the recovery of its gaming business. The financial report shows that the gaming revenue in the second quarter increased by 13% year-on-year, reaching 1.01 billion yuan. However, the total revenue of mobile gaming business in the first half of the year was 1.99 billion yuan, a year-on-year decrease of 2%.
Bilibili stated that, driven by the outstanding performance of the recently launched new game "Three Kingdoms: Conquering the World", mobile gaming revenue resumed year-on-year growth in the second quarter, demonstrating its operational capabilities beyond the ACG gaming category.
The gaming industry is no longer just about making quick money, but about valuing long-term management and optimizing user experience, "Chen Rui emphasized." Our goal is to make it a high-quality game that can continue to operate for more than 5 years. Bilibili hopes to strive to be the most respected company in the industry for players in order to operate this game for the long term
In terms of value-added services (live streaming), the second quarter achieved a year-on-year growth of 11%, reaching 2.57 billion yuan.
Live streaming sales have become another growth point for Bilibili. Chen Rui revealed that during this year's 618 promotion, e-commerce customers' advertising on Bilibili increased by 300% year-on-year, and the sales generated by e-commerce sales increased by over 140% year-on-year. During this year's 618 shopping festival, it also brought a 50% new customer rate to industry merchants, with the maternal and child industry accounting for over 70% of new customer rates.
Data shows that nearly 40 million users watched Bilibili's e-commerce content in the second quarter, a year-on-year increase of 70%. The daily average number of UP hosts carrying goods increased by over 130% year-on-year, the number of articles carrying goods increased by over 330% year-on-year, and the number of live streaming sales increased by 270% year-on-year.
The profitability of Bilibili has always been the focus of external attention, and financial reports show that Bilibili's operations have indeed improved. The gross profit of Bilibili in the second quarter increased by 49% year-on-year, reaching 1.8 billion yuan. The gross profit margin increased from 23.1% in the same period last year to 29.9%, achieving the eighth consecutive quarter on quarter increase. In addition, Bilibili achieved a positive operating cash flow of 1.75 billion yuan in the second quarter and a total of 2.4 billion yuan in the first half of the year.
However, the daily active growth rate of Bilibili has shown a clear slowing trend. In the second quarter, the average daily active users of Bilibili reached 102 million, a year-on-year increase of 6%, and the monthly average active users reached 336 million, which was lower than market expectations.
In terms of advertising business, the revenue in the second quarter increased by 30% year-on-year, reaching 2.04 billion yuan. Chen Rui said that he is confident in maintaining a growth rate higher than the industry in the second half of this year. Bilibili users have a stronger desire to pay for content and express their love for the platform by paying UP hosts. In the future, they will continue to maintain a revenue model that combines game membership live streaming and advertising revenue.
According to financial reports, in the first half of the year, the number of Bilibili advertisers increased by 50% year-on-year, and the coverage rate of AI vendors exceeded 90%. Chen Rui said that Bilibili has the richest AI materials on the entire network, with over 80 million people watching AI videos every month, making it the community with the highest density of AI practitioners in China. 90% of AI giants choose to establish accounts and communicate with users on Bilibili.
As of the close on the 22nd, the Hong Kong stock market on Bilibili fell 1.3% to close at HKD 106.3, while the US stock market fell 7.49% to close at USD 12.97.