Bilibili Stock Analysis

Can Bilibili ever become profitable?

Overview 📖

Bilibili products:

• Video sharing and streaming applications like YouTube
• mobile games.

from bilibili.com

Bilibili revenue composition:

• Mobile Games 27%
• Membership and Services 41%
• Advertising 21%
• E-commerce 12%.

Bilibili industries

• Streaming Service
• Gaming
• Advertising
• E-commerce

Advantages 🏰

• Bilibili has built a loyal and active user community and does not have a similar competitor in China.
• The average age of Bilibili users is 23.5 years old, and 86% of our users are below 35 years old. More than half of our users are from the first and second-tier cities, all of which metric represents the main cohort that’s driving all kinds of consumption in China.

Growth 🌱

• Revenue Q/Q (3.9B -> 5.05B) +30%
• Revenue TTM (14.32B -> 20.54B) +43%
• Paying user members Q/Q +60%.
• Ad revenue by 46% year-on-year in Q1.
• Total MAUs grew by 31% year over year
• DAUs grew by 32% year over year.
• DAU Daily time spent grew 52% year-over-year

from Bilibili.com

Profitability 💰

• Gross Margin 16%
• Operating Margin -39%
• Net Margin -45%
• Gross Profit Q/Q (164.67M -> 121.09M) -26%
• Gross Profit TTM(886.65M -> 615.1M) -31%
• Operating Expenses Q/Q (319.32M -> 419.71M) +31%
• Operating Expenses / Gross Profit (419.71M / 121.09M) 347%
• Operating Expenses / Gross Profit (1.72B / 615.1M) 280%

Valuation ⚖️

• Market Cap 11B
• P / S: 4
• P / Gross Profit: 18
• P / Operating Income: No Income
• P / E: Not Profitable

Risks

• China's COVID lockdown makes a lot of advertisers put their advertising plans on hold or delay their advertising dollars
• As for Bilibili’s e-commerce business, starting from March, especially in April and May, a lot of logistics disruption due to the lockdowns or staying-at-home measures across different cities in Shanghai — in China, and that’s impacting people’s willingness to purchase as well as the delivery services. This impact will continue in the second quarter.
• Bilibili is still far from being profitable. Even worse, its profitability is deteriorating in the latest quarter.

Catalysts

• Story Mode’s short-form video feature (similar to TikTok) continues to grow.

Bull Cases

• Bilibili will continue to grow because of its unique and strong community effect.
• Bilibili could eventually become profitable as Chinese consumers are more willing to spend money on entertainment.

Bear Cases

• Bilibili's user growth would eventually slow down.
• Streaming service is a competitive industry. It does not seem Bilibili is able to find an effective way to be profitable.

Latest Earnings Report:

• Press Release 🔗
• SEC Filing 🔗
• Investor Presentation 🔗
• Investor Relations 🔗