BILIBILI(BILI)2024-05-23 16:06Financial Data and Key Metrics - Total revenues for Q1 2024 reached RMB5.7 billion, up 12% year-over-year [6] - Advertising revenue grew by 31% year-over-year to RMB1.7 billion, while VAS revenue increased by 17% to RMB2.5 billion [6][20] - Gross profit rose 45% year-over-year to RMB1.6 billion, with gross profit margin improving to 28.3% from 21.8% in Q1 2023 [6][24] - Adjusted operating loss and adjusted net loss narrowed by 52% and 56% year-over-year, respectively [7][24] - Operating cash flow for Q1 was RMB638 million, demonstrating strong financial health [7][25] Business Line Performance - Advertising business saw significant growth, driven by performance-based ads, which increased over 50% year-over-year [16][29] - VAS business growth was fueled by live broadcasting, with premium membership remaining steady at 21.9 million [20] - Game business generated RMB983 million in revenue, with new game launches like San Guo: Mou Ding Tian Xia expected to drive future growth [21][49] Market and User Engagement - DAUs increased by 9% year-over-year to 102 million, while MAUs grew by 8% to 341.5 million [8] - Average daily time spent on the platform reached a record 105 minutes, up from 96 minutes in Q1 2023 [8][13] - AI-related content saw significant growth, with daily active content creators and video views increasing by over 60% and 80% year-over-year, respectively [11] Strategic Direction and Industry Competition - The company is focusing on enhancing commercialization capabilities, particularly in high-margin revenue streams like advertising and VAS [9][16] - AI-driven tools are being developed to improve user experience, content creation, and ad targeting [14][15] - The company is expanding its game portfolio, with new titles like San Guo: Mou Ding Tian Xia and Heaven Burns Red expected to attract a broader gamer base [21][49] Management Commentary on Operating Environment and Future Outlook - Management expects to achieve positive non-GAAP operating profit in Q3 2024, driven by sustained revenue growth and margin improvement [25][63] - The company remains confident in maintaining high growth rates for its advertising business, with expectations of over 30% growth during the June 18th shopping festival [36][40] Other Important Information - The company completed a repurchase offer for its April 2026 notes, reducing its outstanding convertible bonds to $433 million [26] - ESG initiatives were highlighted, with the company publishing its 2023 annual ESG report, focusing on technological innovation and social welfare [22] Q&A Session Summary Question: Key drivers of advertising growth and outlook for Q2 2024 - Advertising growth was driven by increased ad inventory, improved ad placement tools, and AI-driven ad efficiency [29][30][31] - The company expects over 30% growth during the June 18th shopping festival, with brand advertising revenue projected to increase by 40% year-over-year [36][37] Question: Game business outlook and expectations for San Guo: Mou Ding Tian Xia - The company aims to stabilize legacy games while exploring new opportunities in the gaming market [43][44] - San Guo: Mou Ding Tian Xia has over 2 million pre-registrations and is expected to perform well upon its June 13th launch [49][50] Question: User engagement drivers and future content categories - Strong user engagement was driven by content categories like knowledge, ACG, and tech, with emerging categories like baby and maternity showing rapid growth [55][56] - The company plans to continue enhancing its content offerings to sustain user growth and engagement [58] Question: Cost control and margin outlook - Cost control efforts led to a 2% year-over-year increase in cost of revenue, while gross profit margin improved to 28.3% [24][61] - The company expects gross profit margin to reach 30% in Q3 2024, with non-GAAP operating breakeven anticipated [63] Question: Prospects of community-based content payment business - The company has nearly 22 million premium members, with 80% on long-term subscription plans [67] - Value-added services like premium courses and fan charging videos are growing rapidly, contributing close to RMB1 billion in revenue in Q1 [69][70]