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Bilibili (BILI) Q3 Earnings Miss Estimates, Revenues Up Y/Y

Zacks Equity Research

Bilibili BILI incurred an adjusted loss of 15 cents per share in third-quarter 2019 that was wider than the Zacks Consensus Estimate of a loss of 13 cents. However, revenues of $260.1 million beat the consensus mark by 5%.

In domestic currency, Bilibili reported an adjusted loss of RMB1.05 per share, much wider than the year-ago quarter’s loss of RMB0.72.

Revenues jumped 72% year over year to RMB1.86 billion.

Average monthly active users (MAU) reached 127.9 million, up 38% from the year-ago quarter.  Mobile MAUs reached 114.2 million, up 43% year over year. Moreover, average monthly paying users (MPU) surged 124% year over year to 7.9 million.

Additionally, average daily active users (DAU) increased 40% year over year to 37.6 million.

Top-Line Details

Mobile game revenues grew 25% year over year to RMB933.1 million ($130.6 million), primarily owing to an increase in the popularity of both existing and newly-launched mobile games. Average monthly paying users for mobile games increased to 1.5 million compared with 0.9 million in the year-ago quarter.
 

Bilibili Inc. Sponsored ADR Price, Consensus and EPS Surprise

Bilibili Inc. Sponsored ADR Price, Consensus and EPS Surprise

Bilibili Inc. Sponsored ADR price-consensus-eps-surprise-chart | Bilibili Inc. Sponsored ADR Quote

 

Live broadcasting and Value-added services (VAS) revenues surged 167% year over year to RMB452.5 million ($63.3 million). This was primarily driven by an increase in the number of paying users for live broadcasting services and premium membership program.

Advertising revenues (13.9% of total revenues) also soared 80% year over year to RMB247.2 million ($34.6 million), mainly attributable to a rise in revenues from performance-based advertising and brand advertising.

E-commerce & others revenues (7% of total revenues) were up a whopping 703% year over year to RMB226.1 million ($31.6 million), primarily due to higher sales of products through the company’s e-commerce platform.

Operating Details

Gross profit surged 80% year over year to RMB351.3 million ($49.1 million).

Selling and marketing expenses skyrocketed 85% year over year to RMB363.9 million ($50.9 million). The improvement was primarily attributed to rising channel and marketing expenses associated with the app and the brand, and promotional expenses for Bilibili’s mobile games.

Additionally, an increase in headcount and rising fulfillment costs associated with Bilibili’s e-commerce business resulted in higher expenses.

General and administrative expenses grew 48% year over year to RMB163.2 million ($22.8 million), primarily attributable to a rise in personnel-related expenses.

Research and development expenses soared 69% year over year to RMB247.3 million ($34.6 million), primarily due to an increase in headcount and share-based compensation expenses.

Operating expenses surged 104% year over year to $70.7 million.

Outlook

For the fourth quarter of 2019, Bilibili expects net revenues between RMB1.93 billion and RMB1.938 billion.

Zacks Rank & Stocks to Consider

Currently, Bilibili carries a Zacks Rank #3 (Hold).

Some better-ranked stocks in the broader technology sector include Baidu BIDU, Marchex MCHX and Akamai Technologies AKAM. While Akamai has a Zacks Rank #2 (Buy), both Baidu and Marchex sport 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 Baidu, Marchex and Akamai is currently pegged at 2.3%, 15% and 12%, respectively.

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