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Bilibili's (BILI) Q3 Loss Narrows, Revenues Increase Y/Y

Bilibili Inc.BILI incurred adjusted loss of 10 cents per share in third-quarter fiscal 2018. However, the loss narrowed to RMB0.72 from the year ago quarter's loss of RMB1.03.

Revenues in the quarter totaled $157.1 million, up 48% year over year.

The Zacks Consensus Estimate for third-quarter earnings and revenues was pegged at breakeven and $147 million, respectively.

Addition of premium and diverse content through partnerships helped Bilibili to attract new users and drive overall business growth.

Quarter Details

Segment wise, Mobile games revenues (69% of total revenues) increased 24% year over year to $108.3 million, primarily owing to increase in number of paying users for mobile games. Additionally, average monthly paying users for mobile games rose 23% year over year to 0.9 million and mobile MAUs increased 33% year over year to 80 million.

Live broadcasting and VAS revenues (15.7% of total revenues) surged 292% year over year to $24.7 million. The upside was mainly driven by increase in number of paying users for live broadcasting services and premium membership program.

Advertising revenues (12.7% of total revenues) also surged 179% year over year to $20 million, attributable to increase in revenues from performance-based advertising and brand advertising.

However, others revenues (2.6% of total revenues) decreased 20% year over year to $4.1 million, mainly due to the spinoff of Bilibili's offline events business in the year-ago quarter. This downturn was offset by rise in product sales on Bilibili's e-commerce platform.

Average monthly paying users surged 202% year over year to 3.5 million. Also, average monthly active users (MAUs) increased 25% year over year to 92.7 million. Moreover, time spent by daily active users (DAUs) improved to 85 minutes from 75 minutes in the prior-year quarter.

Bilibili Inc. Sponsored ADR Price, Consensus and EPS Surprise

Bilibili Inc. Sponsored ADR Price, Consensus and EPS Surprise | Bilibili Inc. Sponsored ADR Quote

Operating Details

Selling and marketing expenses surged 163% year over year to $28.7 million. The improvement was primarily backed by rise in promotional and channel, and marketing expenses and increase in selling and marketing personnel headcount.

General and administrative expenses were up 93% year over year to $16.1 million mainly attributable to increase in share based compensation expenses and headcount.

Research and development expenses increased 96% year over year to $21.3 million primarily due to increase in headcount.

Operating expenses surged 120% year over year to $66.1 million.

Recent Announcements

On Oct 3, 2018, Tencent Holding TCEHY bought Bilibili's Class Z ordinary shares worth US$317.6 million. Currently, Tencent holds 12% of the company's total issued shares.

Additionally, this October, Bilibili and Tencent extended their partnership in anime projects. They will also jointly operate more Tencent games going forward.

Zacks Rank & Stocks to Consider

Bilibili currently carries a Zacks Rank #3 (Hold). Some better-ranked stocks in the broader technology sector are Himax Technologies, Inc. HIMX and Ubiquiti Networks, Inc. UBNT , each sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today's Zacks #1 Rank stocks here.

Long-term earnings growth rate for Himax Technologies and Ubiquiti Networks is projected to be 25% and 14%, respectively.

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Tencent Holding Ltd. (TCEHY): Free Stock Analysis Report

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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