Bilibili Inc. Announces Fourth Quarter 2019 and Fiscal Year 2019 Financial Results
Total net revenues. Total net revenues increased to RMB6,777.9 million (US$973.6 million), representing an increase of 64% from 2018.Mobile games. Revenues from mobile games increased to RMB3,597.8 million (US$516.8 million), representing an increase of 23% from 2018. The increase was primarily due to the increased number of paying users for mobile games.Live broadcasting and Value-added services (VAS). Revenues from live broadcasting and VAS increased to RMB1,641.0 million (US$235.7 million), representing an increase of 180% from 2018, mainly attributable to the Company’s enhanced monetization efforts, led by the increases in the number of paying users for Bilibili’s live broadcasting services, as well as its premium membership program and other VAS.Advertising. Revenues from advertising increased to RMB817.0 million (US$117.4 million), representing an increase of 76% from 2018. This increase was primarily attributable to increased revenues from brand advertising and performance-based advertising.E-commerce and others. Revenues from e-commerce and others were RMB722.1 million (US$103.7 million), representing an increase of 403% from 2018, primarily attributable to the increase in sales of products through the Company’s e-commerce platform.Cost of revenues. Cost of revenues increased by 71% to RMB5,587.7 million (US$802.6 million), compared to RMB3,273.5 million in 2018. Revenue-sharing cost, a key component of cost of revenues, was RMB2,494.4 million (US$358.3 million), representing an increase of 53% from 2018.Gross profit. Gross profit increased to RMB1,190.2 million (US$171.0 million), representing an increase of 39% from 2018.Total operating expenses. Total operating expenses increased to RMB2,685.4 million (US$385.7 million), representing an increase of 69% from 2018.Sales and marketing expenses. Sales and marketing expenses were RMB1,198.5 million (US$172.2 million), representing a 105% increase year-over-year. The increase was primarily attributable to increased channel and marketing expenses associated with Bilibili’s app and brand, including offline events, as well as promotional expenses for the Company’s mobile games, an increase in headcount in sales and marketing personnel, and an increase in fulfillment costs associated with Bilibili’s e-commerce business.General and administrative expenses. General and administrative expenses were RMB592.5 million (US$85.1 million), representing a 28% increase year-over-year. The increase was primarily due to increased general and administrative personnel-related expenses, increased amortization expense related to intangible assets acquired through business acquisitions, and increased other miscellaneous expenses associated with Bilibili’s business expansion.Research and development expenses. Research and development expenses were RMB894.4 million (US$128.5 million), representing a 66% increase year-over-year. The increase was primarily due to increased headcount in research and development personnel and increased share-based compensation expenses.Loss from operations. Loss from operations was RMB1,495.2 million (US$214.8 million), compared to RMB729.0 million in 2018.Interest expense. Interest expense was RMB46.5 million (US$6.7 million), mainly derived from the convertible senior notes the Company offered in April 2019.Income tax expense. Income tax expense was RMB35.9 million (US$5.2 million), compared to RMB26.0 million in 2018.Net loss. Net loss was RMB1,303.6 million (US$187.2 million), compared to RMB565.0 million in 2018.Adjusted net loss3. Adjusted net loss, which is a non-GAAP measure that excludes share-based compensation expenses and amortization expense related to intangible assets acquired through business acquisitions, was RMB1,081.5 million (US$155.3 million), compared to RMB377.4 million in 2018.Basic and diluted EPS and adjusted basic and diluted EPS3. Basic and diluted net loss per share were RMB3.99 (US$0.57), compared to RMB2.64 in 2018. Adjusted basic and diluted net loss per share were RMB3.30 (US$0.47), compared to RMB1.84 in 2018.Notes to Unaudited Financial InformationThe unaudited financial information disclosed in this press release is preliminary. The audit of the financial statements and related notes to be included in the Company’s annual report on Form 20-F for the year ended December 31, 2019 is still in progress. In addition, because an audit of the Company’s internal controls over financial reporting in connection with section 404 of the Sarbanes-Oxley Act of 2002 has not yet been completed, the Company makes no representation as to the effectiveness of those internal controls as of December 31, 2019.Adjustments to the financial statements may be identified when the audit work is completed, which could result in significant differences between the Company’s audited financial statements and this preliminary unaudited financial information.OutlookFor the first quarter of 2020, the Company currently expects net revenues to be between RMB2.15 billion and RMB2.20 billion.The above outlook is based on the current market conditions and reflects the Company’s preliminary estimates, which are all subject to change, particularly in light of the uncertainties related to how COVID-19 develops.____________________
1 Beginning in the first quarter of 2019, the Company began counting mobile MAUs of Bilibili Comic and Maoer toward its MAUs. Bilibili Comic is a mobile application offering comic content the Company launched in November 2018. Maoer is a platform that offers audio drama. In December 2018, Company increased its shareholdings and acquired majority equity interests in Maoer Inc., operator of Maoer app. In the fourth quarter of 2019, Bilibili Comic and Maoer in aggregate contributed 7.5 million to Bilibili’s total MAUs.2 The paying users are calculated by number of users who paid for games, live broadcasting, premium membership, Bilibili Comic and Maoer, after eliminating duplicates of users paid for multiple services other than users of Maoer. The Company adds the number of paying users of Maoer toward its total paying users without eliminating duplicates.3 Adjusted net loss and adjusted basic and diluted EPS are non-GAAP financial measures. For more information on non-GAAP financial measures, please see the section of “Use of Non-GAAP Financial Measures” and the table captioned “Unaudited Reconciliations of GAAP and Non-GAAP Results” set forth at the end of this press release.Conference CallThe Company’s management will host an earnings conference call at 9:00 PM U.S. Eastern time on March 17, 2020 (9:00 AM Beijing/Hong Kong time on March 18, 2020).Dial-in details for the earnings conference call are as follows:United States: +1-866-519-4004
International:+65-6713-5090
Hong Kong: 800-906-601
China: 400-620-8038
Conference ID: 6064648 Participants should dial-in approximately 5 minutes before the scheduled start time and ask to be connected to the call for “Bilibili Inc.”Additionally, a live and archived webcast of the conference call and investor presentation will be available on the Company’s investor relations website at http://ir.bilibili.com.A replay of the conference call will be accessible by phone two hours after the conclusion of the live call at the following numbers, until March 24, 2020:United States: +1-855-452-5696
International:+61-2-8199-0299
Hong Kong: 800-963-117
China: 400-632-2162
Replay Access Code: 6064648About Bilibili Inc.Bilibili represents the iconic brand of online entertainment with a mission to enrich the everyday life of young generations in China. Bilibili is a full-spectrum online entertainment world covering a wide array of genres and media formats, including videos, live broadcasting and mobile games. Bilibili provides an immersive entertainment experience and high-quality content that caters to the evolving and diversified interests of its users and communities, and has built its platform based on the strong emotional connections of Bilibili’s users to its content and communities.For more information, please visit: http://ir.bilibili.com.Use of Non-GAAP Financial MeasuresThe Company uses non-GAAP measures, such as adjusted net loss, adjusted net loss per share and per ADS, basic and diluted, in evaluating its operating results and for financial and operational decision-making purposes. The Company believes that the non-GAAP financial measures help identify underlying trends in its business by excluding the impact of share-based compensation expenses and amortization expense related to intangible assets acquired through business acquisitions, which are non-cash charges. The Company believes that the non-GAAP financial measures provide useful information about the Company’s results of operations, enhance the overall understanding of the Company’s past performance and future prospects and allow for greater visibility with respect to key metrics used by the Company’s management in its financial and operational decision-making.The non-GAAP financial measures are not defined under U.S. GAAP and are not presented in accordance with U.S. GAAP. The non-GAAP financial measures have limitations as analytical tools, and when assessing the Company’s operating performance, cash flows or liquidity, investors should not consider them in isolation, or as a substitute for net loss, cash flows provided by operating activities or other consolidated statements of operations and cash flows data prepared in accordance with U.S. GAAP.The Company mitigates these limitations by reconciling the non-GAAP financial measures to the most comparable U.S. GAAP performance measures, all of which should be considered when evaluating the Company’s performance.For more information on the non-GAAP financial measures, please see the table captioned “Unaudited Reconciliations of GAAP and Non-GAAP Results” set forth at the end of this press release.Exchange Rate InformationThis announcement contains translations of certain RMB amounts into U.S. dollars (“US$”) at specified rates solely for the convenience of the reader. Unless otherwise stated, all translations from RMB to US$ were made at the rate of RMB6.9618 to US$1.00, the exchange rate on December 31, 2019 set forth in the H.10 statistical release of the Federal Reserve Board. The Company makes no representation that the RMB or US$ amounts referred could be converted into US$ or RMB, as the case may be, at any particular rate or at all.Safe Harbor StatementThis announcement contains forward-looking statements. These statements are made under the “safe harbor” provisions of the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements can be identified by terminology such as “will,” “expects,” “anticipates,” “aims,” “future,” “intends,” “plans,” “believes,” “estimates,” “confident,” “potential,” “continue,” or other similar expressions. Among other things, the Outlook and quotations from management in this announcement, as well as Bilibili’s strategic and operational plans, contain forward-looking statements. Bilibili may also make written or oral forward-looking statements in its periodic reports to the U.S. Securities and Exchange Commission, in its annual report to shareholders, in press releases and other written materials and in oral statements made by its officers, directors or employees to third parties. Statements that are not historical facts, including but not limited to statements about Bilibili’s beliefs and expectations, are forward-looking statements. Forward-looking statements involve inherent risks and uncertainties. A number of factors could cause actual results to differ materially from those contained in any forward-looking statement, including but not limited to the following: Bilibili’s strategies; Bilibili’s future business development, financial condition and results of operations; Bilibili’s ability to retain and increase the number of users, members and advertising customers, provide quality content, products and services, and expand its product and service offerings; competition in the online entertainment industry; Bilibili’s ability to maintain its culture and brand image within its addressable user communities; Bilibili’s ability to manage its costs and expenses; PRC governmental policies and regulations relating to the online entertainment industry, general economic and business conditions globally and in China and assumptions underlying or related to any of the foregoing. Further information regarding these and other risks is included in the Company’s filings with the Securities and Exchange Commission. All information provided in this press release and in the attachments is as of the date of the press release, and the Company undertakes no duty to update such information, except as required under applicable law.For investor and media inquiries, please contact:In China:Bilibili Inc.
Juliet Yang
Tel: +86-21-2509 9255 Ext. 8523
E-mail: ir@bilibili.comThe Piacente Group, Inc.
Emilie Wu
Tel: +86-21-6039-8363
E-mail: bilibili@tpg-ir.comIn the United States:The Piacente Group, Inc.
Brandi Piacente
Tel: +1-212-481-2050
E-mail: bilibili@tpg-ir.comBILIBILI INC.Unaudited Condensed Consolidated Statements of Operations(All amounts in thousands, except for share and per share data)The accompanying notes are an integral part of this press release.NOTES TO UNAUDITED FINANCIAL INFORMATION(All amounts in thousands, except for share and per share data)BILIBILI INC.Unaudited Condensed Consolidated Balance Sheets(All amounts in thousands, except for share and per share data)BILIBILI INC.Unaudited Reconciliations of GAAP and Non-GAAP ResultsAll amounts in thousands, except for share and per share data