On the evening of March 7th, Bilibili (NASDAQ: BILI, HKEX: 9626; referred to as "Bilibili") released its unaudited financial reports for the fourth quarter and full year ended December 31, 2023.
According to the financial report, the total revenue of Bilibili for the year 2023 reached 22.53 billion yuan, with a total revenue of 6.35 billion yuan in the fourth quarter, both of which increased by 3% compared to the same period in 2022.
Affected by the news, the US stock price of Bilibili fell nearly 8% during the trading session, but the decline subsequently narrowed. As of the close, the stock price fell by 1.94%. Since the beginning of this year, Bilibili has fallen by 13%.
When it comes to business performance, Chen Rui, Chairman and CEO of Bilibili, said, "2023 is a year of both opportunities and challenges. In the past year, we have achieved healthy community growth, improved commercialization capabilities and operational efficiency, and significantly narrowed losses. In the fourth quarter of last year, Bilibili had an average daily active user count of over 100 million, and the average daily user usage time exceeded 95 minutes.". We continue to promote commercial capacity building to enable more creators to earn income on Bilibili. In 2023, over 3 million creators earned revenue on Bilibili, a year-on-year increase of 30%. In the fourth quarter, advertising and value-added service revenue increased by 28% and 22% year-on-year, respectively, achieving a positive cycle of community and business. With the improvement of operating efficiency, the gross profit of Bilibili in the fourth quarter increased by 33% year-on-year, and the gross profit margin continued to increase by 26.1% for six consecutive quarters. The adjusted net loss for the whole year narrowed by 49% year-on-year (58% year-on-year in the fourth quarter) and achieved positive operating cash flow for the year
Data shows that with the daily active users stabilizing at the level of 100 million, Bilibili had an average monthly interaction of over 14 billion times in the fourth quarter, and the daily usage time of users remained stable at 95 minutes. The daily video playback volume for the whole year reached 4.3 billion, a year-on-year increase of 25%. As of the end of 2023, 230 million users have passed the entrance exam and become official members of Bilibili. The retention rate for official members in the 12th month has remained stable at around 80%.
The activity of community ecology has also driven the growth of creator ecology. In the fourth quarter of last year, the daily active UP owners on Bilibili increased by 16% year-on-year, with the number of UP owners with over 10000 followers increasing by 30% year-on-year; The average monthly submission volume exceeded 23 million, a year-on-year increase of 31%. In 2023, over 3 million UP owners obtained revenue from Bilibili through various monetization channels, a year-on-year increase of 30%. Among them, the number of UP owners who obtained revenue through advertising increased by 94% year-on-year; Trading sales have also brought more opportunities. During the Double Twelve period, the sales volume of UP's main live streaming sales exceeded 50 million yuan; In 2023, over 1.8 million UP hosts earned revenue through live streaming, and over 200 UP hosts earned over 1 million in revenue from paid courses produced.
Take a closer look at the composition of income. The company's advertising revenue grew significantly, with a year-on-year increase of 28% in the fourth quarter to 1.93 billion yuan; In 2023, Bilibili's advertising revenue was 6.4 billion yuan, a year-on-year increase of 27%, mainly due to the optimization of the company's advertising products and the improvement of advertising efficiency.
In terms of value-added services, in 2023, Bilibili's value-added service business revenue reached 9.91 billion yuan, a year-on-year increase of 14%; In the fourth quarter, the revenue reached 2.86 billion yuan, a year-on-year increase of 22%. Live streaming revenue is the main driving force for the growth of value-added service revenue. Over the past year, Bilibili has integrated live streaming and video ecosystem operations, promoting more UP hosts to become anchors and enriching the live streaming content ecosystem. As of the end of the fourth quarter, the number of major members on Bilibili reached 21.9 million, of which over 80% were annual subscription or automatic renewal members.
In terms of gaming business, in the fourth quarter of 2023, Bilibili's gaming revenue was 4.02 billion yuan and 1.01 billion yuan, respectively, a decrease of 20% and 12% year-on-year. The main reason for the decline is due to the high base of Time and Space Hunter 3 released in the second half of 2022, while the best performing old games such as Blue Sea Route and FGO have maintained relatively stable revenue.
It is understood that there are currently three proxy games in Bilibili's game reserve that have obtained licenses and are planned to be launched and operated in the next few quarters, including strategy games "Three Kingdoms: Plan the World", card games "Blazing Sky" and "Wuhua Mixin".
In terms of IP derivatives and other businesses, Bilibili's revenue in 2023 was 2.2 billion yuan, a year-on-year decrease of 29%, mainly due to the decrease in revenue from esports copyright transfer and IP derivative sales.
The total operating expenses of Bilibili in 2023 were 10.5 billion yuan, a decrease of 14% compared to 2022, mainly due to a decrease in promotion related to user acquisition, a decrease in the number of general and administrative personnel, and a decrease in the number of R&D personnel. As of December 31, 2023, the total amount of cash and cash equivalents, fixed deposits, and short-term investments held by the company was RMB 15 billion.