Bilibili notches Q3 revenue beat, but losses widen as expansion takes hold

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A poster for Bilibili’s offline event “Bilibili World.” (Image Credit: Bilibili)

Anime and game-centric video sharing site Bilibili reported strong revenue growth in the third quarter powered by rising user spending, though losses for the period also continued to widen as the company expands its entertainment offerings.

Why it matters: Bilibili has been broadening its services beyond video-sharing and game publishing to live-streaming, online comics, and e-commerce to boost growth and reach a market capitalization of $10 billion, a goal recently set by its CEO.

“Looking ahead, we will continue to convert our growing traffic to paying users, further improve our gross margin and continue to work to achieve sustainable growth.”

Sam Fan, Bilibili’s chief financial officer, in a statement

Details: Bilibili’s total net revenues for the third quarter jumped 72% year on year to RMB 1.86 billion ($260 million), topping the high end of consensus estimates from analysts surveyed by Yahoo Finance.

  • Revenues from mobile games grew 25% year on year and accounted for half of the total net revenues for the period.
  • Live broadcasting and value-added services revenues surged 167% year on year to reach RMB 452 million, driven primarily by growth in the number of paying users and spending per user, as well as Bilibili’s premium membership program.
  • E-commerce revenues rocketed 703% compared with the same period last year, reaching RMB 226.1 million.
  • Average monthly active users (MAUs) grew 38% year on year to 128 million, whereas mobile MAUs increased by 43% to 114 million compared with the same period last year.
  • Average monthly paying users surged 124% year on year to 7.9 million, driving the company’s revenue per MAU up 25% year on year, and non-game revenue per MAU to double year on year.
  • Bilibili’s net loss for the three months ended Sep. 30 also expanded 61% year on year to RMB 405.7 million. The company did not disclose specific factors driving its higher losses.
  • Bilibili expects net revenues of between RMB 1.93 billion and RMB 1.98 billion for the fourth quarter of 2019.
  • CEO Chen Rui said in September that a $10 billion market cap was the minimum size for content platforms that wish to remain up and running in China three years from now, according to a report from Chinese media LatePost.

Context: Bilibili has been trying to enrich its content offering beyond its initial focus on anime, comics, and games (ACG) with paid online courses and an incentive program for music content creators.

  • Rolled out in late October, the paid course system includes classes on practical skills as well as informational topics such as history.
  • The music incentive program aims to attract creators with existing follower bases to join Bilibili as verified artists, offering more exposure and cooperation opportunities with the platform.

Anime video platform Bilibili is beta testing paid courses