Bilibili (NASDAQ:BILI) held its first-quarter earnings conference call on Tuesday. Below is the complete transcript from the call.
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Summary
Bilibili reported a 7% year-over-year growth in total revenues to RMB 7.5 billion, with a gross profit up 9% and a gross margin of 37.1%.
The company achieved a 30% year-over-year increase in advertising revenue, driven by high user engagement and AI-integration efforts.
User engagement metrics were strong, with average daily time spent increasing by 11 minutes year over year and total user time spent rising 19%.
AI investments focused on enhancing video understanding, distribution, and creation, contributing to user growth and improved advertising efficiency.
Game revenues faced a 12% decline year-over-year, but new titles are in development, with positive feedback received from soft launches.
Bilibili maintained its strategy of long-term game operations, focusing on creating games that resonate with the younger generation.
The company completed a US dollar 200 million share repurchase program and is considering renewing it to enhance shareholder returns.
Management expressed confidence in continued growth, with a focus on leveraging AI to drive efficiencies and innovation across its businesses.
Full Transcript
Chen
15 million and MAUs increased to 376 million. Average daily time spent reached a new high of 119 minutes, up 11 minutes year over year, which led to a 19% surge in total user time spent. We see this level of engagement as a powerful engine for our commercial business. In the first quarter, we delivered robust advertising revenue growth of 30% year over year, further accelerating from 2025. Meanwhile, MPUs increased by 7% year over year to 34.4 million. As more users directly pay for content and services they truly care about. On our platform, this commercial momentum led to a strong financial performance. Total revenues grew 7% year over year to RMB 7.5 billion. Gross profit was up 9% year over year and gross margin reached 37.1%, marking our 15th consecutive quarter of margin expansion. Thanks to our top line growth and increased operating leverage, our operating profit was over 10 times what it was a year ago. On a non GAAP basis, net profit grew by 62% year over year, with our adjusted net profit margin expanding to 7.8%. To us, this set of results confirms a fundamental shift in user behavior. In a world full of quick hits, more users are choosing to spend more time on quality content. That is exactly what Bilibili stands for and it will continue to drive our growth. With our average user now around 26.5 years old, our cohort is starting to spend more and spend better. As their needs evolve, we are staying close to them, offering the products and experiences they care about most. The content ecosystem we have built remains our most durable asset. Today, we are using AI to make this ecosystem even more powerful. We are focusing our investments on three key how we understand videos, how we recommend them, and how we help creators build them. Ultimately, we are not just evolving with AI, we are using it to reinforce the very thing that makes Bilibili unique. Having said that, we remain very disciplined with our capital. Although AI requires an upfront investment, the returns in engagement and monetization are already tangible. At the same time, AI is driving meaningful efficiencies across our operations, which is directly supporting our margin expansion. By combining the heart of our community with the power of our technology, we are creating lasting value for our users and shareholders. With that, let me walk you through our core pillars of content community and commercialization. Starting with Content and Community as content options multiply, users are becoming even more selective. They are coming to Bilibili for high quality PUGV content and a unique community experience that they cannot find anywhere else. Across our content categories, ACG remains our Cultural anchor in the first quarter, watch time for games in Chinese anime grew 27% and 20% year over year respectively, proving our enduring appeal to the younger generation. Beyond our ACG legacy, knowledge based content, including AI related information grew 20% year over year as users turned to us for deeper insights. Music categories also saw robust growth with a 25% year over year increase in time spent largely driven by AIGC. Music consumption related categories kept rising with watch time for parenting and early education and outdoor related categories surging by more than 50% year over year. The breadth of our content library is only one part of the story. Our deeper competitive moat lies in the humanity of the community. Every month our users generate over 17 billion real human interactions. In an AI driven world, they are the most authentic human signals available. While high quality data is becoming a global scarcity, our hundreds of billions of organic interactions provide us with the gold standard for understanding true human preferences. This profound insight is what fuels our engagement and loyalty. In the first quarter, total user time spent rose 19% year over year and 291 million official members maintained an 80% 12 month retention rate. Meanwhile, we continue to see AI as an amplifier for our ecosystem’s flight. On the supply side, the unique creative spirit of our community has found new momentum through the AI powered tools that scale creativity across the platform. By lowering the barriers to entry and boosting productivity, we have seen a significant influx of creators in content. In Q1, the number of daily active creators and daily submissions grew by 6% and 19% year over year respectively. But this isn’t just a game of volume. With AI assisting the creative process, more talent is producing high quality breakout content right out of the gate. Our recent AI creation contest is a perfect example. We attracted the most talented creators to join our platform, creating nearly 150 breakout works with over a million views each. By deepening our comprehension of both content and user behavior, we’ve made content discovery more efficient, directly accelerating growth for our creators. In the first quarter, the number of creators with over 1,000 followers grew by more than 30% year over year and those with 10,000, 100,000 and 1 million or more followers each grew over 20%. Naturally, as their audiences grow, earnings follow. Average income per creator rose 24% this quarter, creating a powerful, virtuous cycle. Now let us take a closer look at our commercial businesses and their progress. First, our advertising business once again delivered standout results. In Q1, revenues grew 30% year over year, reaching RMB 2.6 billion. This ongoing acceleration reflects the value of our community that we continue to unlock and how we are turning user engagement into real results for advertisers. In Q1, our top five ad verticals were gains Internet Services, Digital products and home appliances, E commerce and automotive game ads delivered strong incremental revenue growth this quarter. In the Internet services sector, AI advertisers kept scaling with ad budgets surging over 170% year over year. At the same time, our maturing user base is also capturing more advertisers budgets. Ad revenues from digital products and home appliances and automotive both grew over 30% year over year. In Q1, home decoration was a particular standout with ad spending jumping more than 130% year over year. Using AI to improve efficiency and drive ad business is a core priority this year. By integrating AI more deeply into our algorithms, we’ve gained much sharper insights into user interests and long term patterns. This clarity has meaningfully optimized how we match users with ads, resulting in a 25% year over year increase in CTCVR of performance based ads this quarter. Furthermore, our AIGC tools are streamlining creative production and crafting ads that resonate with users, helping advertisers connect with our community more effectively and drive higher click through rates. We are also unlocking growth across diverse platforms and touchpoints. In the first quarter, ad revenues from PC and OTT platforms grew by over 50% year over year while new scenarios like search and mini programs more than doubled. We’re exploring new integrated formats within video player, finding new ways to turn user time into commercial value. With expanding traffic, diverse new scenarios and continuous efficiency gains, we remain confident in the sustained momentum of our ad business. Now turning to our games business. Game revenues were RMB 1.5 billion, down 12% year over year and flat quarter over quarter. The year over year decline was mainly due to the high base set by Sun Mo Din Tianxia in the same period last year, while the latest seasons of Sun Mo performed steadily quarter over quarter, we’re focused on the game’s long term life cycle, keeping the experience balanced and the IP strong. Meanwhile, our evergreen titles FGO and Azure Land remain stable and continue to provide a solid revenue base in 2026. We’re building on Sun Mo’s success and expanding our presence in the Three Kingdoms IP. In April we soft launched NCard, a lighter casual card game that has received positive feedback on its core gameplay. We’re iterating the product and optimizing user acquisition as we prepare for its official launch this July. Meanwhile, our new SLG title San Wanguozhi Wang Dao Tianxia began initial testing in late March. Built on the original IP with enhanced 3D visuals, Sanwang targets a differentiated group of SLG fans and complements Sun Mo. Early user feedback was encouraging and we plan to roll the game out late this year. Beyond End Card and Sanhwang, our self developed simulation game Lumi Master Shyoba Lumi Master entered its paid testing in May. It has been well received for its …
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