On the evening of November 29th, Bilibili (NASDAQ: BILI, HKEX: 9626; referred to as "Bilibili") released its unaudited financial report for the third quarter as of September 30, 2023. The financial report shows that the daily active users of Bilibili exceeded the milestone of 100 million in the third quarter, with a total revenue of 5.81 billion yuan. Meanwhile, with the optimization of cost structure, the company's gross profit margin has achieved five consecutive quarter on quarter increases, increasing from 18% in the same period last year to 25%, and the adjusted net loss has significantly narrowed by 51% year-on-year.
According to the financial report, during the reporting period, the daily active users of Bilibili increased by 14% year-on-year, reaching 103 million, and the monthly active users reached a new high of 341 million. The average daily usage time of users exceeded 100 minutes for the first time. Along with high-quality user growth, operational efficiency continues to improve, with a year-on-year increase of 38% in gross profit for the quarter, achieving five consecutive quarter on quarter increases.
"In the future, we are confident in continuously promoting user growth and high-quality community development, enhancing commercialization capabilities and operational efficiency, and creating more value for users, creators, and partners." Chen Rui, Chairman and CEO of Bilibili, stated that the growth of communities and the improvement of commercialization efficiency directly drove the rapid increase in advertising and value-added service revenue, with year-on-year growth of 21% and 17% respectively. The total revenue from advertising business reached 1.64 billion yuan, with the top five advertising industries being gaming, digital home appliances, e-commerce, food and beverage, and automobiles.
In addition, in a challenging market environment, Bilibili achieved positive operating cash flow in the third quarter of this year, steadily moving towards profitability goals. As of September 30th, Bilibili held a total of 14.5 billion yuan (2 billion US dollars) in cash and cash equivalents, fixed deposits, and short-term investments.
Overall, high-quality video content across multiple categories and scenarios has driven an increase in the activity and overall traffic of the Bilibili community. The financial report shows that the daily average video playback of Bilibili in the third quarter reached 4.7 billion, a year-on-year increase of 26%, and the monthly average interaction reached 17 billion, a year-on-year increase of 18%. As of the end of the third quarter, the number of "official members" who passed the exam on Bilibili reached 224 million, a year-on-year increase of 23%. The retention rate of official members in the 12th month has remained stable at around 80%. At the same time, the creator ecosystem also achieved high-quality growth in the third quarter. The daily active number of UP owners on Bilibili increased by 21% year-on-year, and the number of UP owners with over 10000 followers increased by 36% year-on-year; The average monthly video submission volume increased by 37% year-on-year, reaching 21 million.