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Bilibili (BILI) to Report Q2 Earnings: What's in the Cards?

Zacks Equity Research
·4 min read

Bilibili Inc. BILI is set to report second-quarter 2020 results on Aug 26.

For second-quarter 2020, revenues are anticipated between RMB2.50 billion and RMB2.55 billion.

The Zacks Consensus Estimate for revenues is pegged at $360.03 million, indicating 59.7% upside from the year-ago quarter’s reported figure.

The consensus mark for second-quarter loss has remained steady at 22 cents over the past 30 days. The company had incurred loss of 11 cents in the year-ago quarter.

In first-quarter 2020, Bilibili reported non-GAAP earnings per American Depositary Share (ADS) of 23 cents. However, the figure plunged 155.6% year on year.

Revenues of $327 million surged 69% on a year-over-year basis.

Notably, the company’s earnings beat the Zacks Consensus Estimate in the trailing three quarters while missing in one, the average negative surprise being 19.07%.

Let’s see how things have shaped up for the upcoming announcement.

Bilibili Inc. Sponsored ADR Price and EPS Surprise

Bilibili Inc. Sponsored ADR Price and EPS Surprise
Bilibili Inc. Sponsored ADR Price and EPS Surprise

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

Factors to Consider

The company has been achieving growth through its core business areas including mobile games, live streaming and distribution of video content.

Bilibili’s top line is expected to have benefited from its enhanced monetization efforts, led by increases in the number of paying users for the company’s premium membership program, live broadcasting services and other value-added services.

In the first quarter of 2020, average monthly paying users (MPUs) reached 13.4 million, up 134% year over year.

Additionally, strong popularity of both existing and newly launched mobile games is expected to have driven active user growth in the to-be-reported quarter. In the first quarter, average monthly active users (MAUs) reached 172.4 million, and mobile MAUs reached 156.4 million, representing increases of 70% and 77%, respectively, from the year-ago quarter.

Moreover, the company’s solid partner base and expanding strategic partnerships, comprising the likes of Alibaba Group and Tencent Holdings has been a key catalyst.

Further, on Apr 10, Sony Corporation’s SNE wholly-owned subsidiary, Sony Corporation of America inked an agreement with Bilibili, subscribing for 4.98% of the total outstanding shares of Bilibili through the purchase of newly-issued Class Z shares for a consideration of about $400 million.

However, increasing channel and marketing expenses associated with Bilibili’s app and brand, as well as promotional expenses for the company’s mobile games is expected to have kept margins under pressure in the to-be-reported quarter.

What Our Model Says

According to the Zacks model, the combination of a positive Earnings ESP and Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. But that’s not the case here.

Bilibili has an Earnings ESP of 0.00% and a Zacks Rank #3. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Stocks to Consider

Here are some companies, which, per our model, have the right combination of elements to post an earnings beat in their upcoming release.

Ambarella, Inc. AMBA has an Earnings ESP of +100.00% and carries a Zacks Rank #3. You can see the complete list of today’s Zacks #1 Rank stocks here.

Bill.com Holdings, Inc. BILL has an Earnings ESP of +10.45% and a Zacks Rank #3.

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Sony Corporation (SNE) : Free Stock Analysis Report
 
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Bilibili Inc. Sponsored ADR (BILI) : Free Stock Analysis Report
 
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