bilibili 1q19 investor presentation-fina

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InvestorPresentationMay 2019

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This announcement contains forward-looking statements. These statements are made under the “safe harbor” provisions of the U.S. PrivateSecurities 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, theOutlook and quotations from management in this announcement, as well as Bilibili’s strategic and operational plans, contain forward-lookingstatements. 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 employeesto 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 differmaterially from those contained in any forward-looking statement, including but not limited to the following: Bilibili’s strategies; Bilibili’s future businessdevelopment, financial condition and results of operations; Bilibili’s ability to retain and increase the number of users, members and advertisingcustomers, provide quality content, products and services, and expand its product and service offerings; competition in the online entertainmentindustry; Bilibili’s ability to maintain its culture and brand image within its addressable user communities; Bilibili’s ability to manage its costs andexpenses; PRC governmental policies and regulations relating to the online entertainment industry, general economic and business conditionsglobally and in China and assumptions underlying or related to any of the foregoing. Further information regarding these and other risks is included inthe Company’s filings with the Securities and Exchange Commission. All information provided in this press release and in the attachments is as of thedate of the press release, and the Company undertakes no duty to update such information, except as required under applicable law.

Safe Harbor Statement

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Enrich the everyday life of young generations in China

1.37bn 101.3mm 81minRevenue

in 19Q1 (RMB) MAU (1) in 19Q1 Mobile MAUin 19Q1

Avg. daily time spent(2)

in 19Q1

:

3

88.6mm

4

17Q1 17Q2 17Q3 17Q4 18Q1 18Q2 18Q3 18Q4 19Q1

424

583

728 734

868

1,027 1,079 1,156

1,374

Our rapid growthRapid user base expansion lays a solid foundation for fast revenue growth

Net revenue (RMB mm)MAU (mm)

17Q1 17Q2 17Q3 17Q4 18Q1 18Q2 18Q3 18Q4 19Q1

5765

74 7277

8593 93

101

5

Gen Z represents the future of online entertainment

328mm Gen Z | 24% of total population in Chinapeople born from 1990 to 2009

Gen Z is the key driving force of China’s online entertainment market

Gen Z outgrows overall China’s online entertainment market

2017

314.7

2020E

678.7Deep user penetration

Extensive time spent

Strong willingness to pay 55%62%

Market size (RMB bn)

Gen Z CAGR

33%

Gen Z’s contribution

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Efficient with tremendous upside

Commercialization

Content Community

Gen ZEver-growing supply ofuser generated content

Highly engagedand sticky

The story

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We have become the welcoming home of diverse interests...

ACGAnime, Comic

and Game

Entertainment

NO.1 (1)

Pop Culture

LifestyleNO.2

(1)

TechnologyNO.5 (1)

AnimeNO.4

(1)

GameNO.3

(1)

(1) Ranked by video views in March, 2019

Celebrity

Vlog

Fashion

E-Sports

Mobile Games

Science

Electronics

Cosplay

Domestic AnimeNotes:

Content Community Commercialization

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…And ever-growing supply of creative PUG videos

(1) In 19Q1

total video views contributed by PUG

videos

(1)

Talented Content CreatorsNumber of Monthly Average Active Content Creators

19Q118Q1

732293

150%

High-quality Content CreationNumber of Monthly Video Submissions

19Q118Q1

2,081905

130%

Loyal Fan BaseNumber of Content Creators with more than 10,000 Fans

Mar 31�2019Mar 31�2018

76%

89%

reate

Engage

EncourageCreate

(‘000)

(‘000)

Notes:


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Continuous support to content creators in all layers

Casual

New

Middle

TopVIP Service

Power AlliancesTop 100 UP Award

Maximize influenceUnlock commercial value

RewardCash Incentive Program

(130,000+ enrolled)

Better incentiveBetter recognition

Higher quality production

TutorNew Star Project

UP Academy

ToolsMobile Content

SubmissionEasier to create


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We also have a expansive OGV LibraryContent Community Commercialization

Animation Documentary TV�Movies and Variety shows

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We fostered highly engaged and sticky communities

Highly engaged users�

514mm avg. daily video views in Q1

1.4bn interactions(1) generated monthly in Q1

93% YoY growth

361% YoY growth

(1) Interactive features such as bullet-chats, commentaries, following, favorites, sharing, bilibili moment posts, virtual gifting and like etc.

Notes:


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49mm official members (1) ~80% 12th-month retention rate (1)

39% YoY growth

(1) As of Mar 31, 2019. To become an official member, user needs to take and pass a community entrance exam consists of 100 questions covering community etiquette and various topics

Notes:

And even more loyal official members

50%

60%

70%

80%

90%

100%

0 3 6 9 12

2017 Apr 2017 May 2017 Jun 2017 July2017 Aug 2017 Sep 2017 Oct 2017 Nov2017 Dec 2018 Jan 2018 Feb 2018 Mar


We fostered highly engaged and sticky communities

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Commercialization comes naturally: massive user demand intersects with high quality supply

Large and engaged user base

with strong willingness to pay

DemandEfficient match

driven by big data insights

of user interests and behaviors

SupplyMobile Games

AdvertisingLive Broadcasting

Value Added Services….

We understand users’ demand… …and we offer the right contentand services


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Compelling core competency of our mobile game business

We know what they want

User interest & behaviorquality user data

Customized game recommendation

We have massive gamers

Game is 3rd most popular video genre on our platform

Ability to pick and operate

1 Self developed

13 Exclusively distributed

500+ Jointly operated

Game-themed live broadcasting is also well received

2019 Launched


More in the pipelineApproved and upcoming

Majority of our games users are directly converted from our platform

Chapter 2.0

1517Q1 17Q2 17Q3 17Q4 18Q1 18Q2 18Q3 18Q4 19Q1

349

492

600 617 688

791 744 713

873

Robust game revenue growth and strong pipeline

RMB (mm)


Up 27%YOY

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Live broadcasting & VAS: multi-faceted commercialization

Live broadcastingNatural extension of our

diversified content platform

Premium membershipEnjoy exclusive or advanced

high quality content


MaoerPremium

audio drama platform

Bilibili ComicPay to view

comic platform

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Live broadcasting: Design to cater Bilibili users’ needs

18Q1 19Q1

7.5

11.4

18Q1 19Q1

0.5

1.2

Massive user base on Bilibili platform High willingness to pay for happiness and appreciation

Live broadcasting valid MAU(1)

(mm)

Note: (1) Valid MAU is calculated by number of users who visited live broadcasting rooms for over 5 minutes(2) Quarterly paying users are calculated by number of users who paid for live broadcasting services at least once during each period

Live broadcasting quarterly paying user(2)

We offer a wide array of content to satisfy our users’ growing demands in games and entertainment

Mobile Games PC Games Console Games E-sports Talents VTubers Pets Audios

….….

(mm)

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RMB (mm)

17Q1 17Q2 17Q3 17Q4 18Q1 18Q2 18Q3 18Q4 19Q1

38 41 4354

96

119

169

202

292


Live broadcasting & VAS revenue: strong growth with great potential

Up 205%YOY

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Gen Z is the golden cohortwell chased by brand advertisers

Brand & Performance-based advertising: two growth engines

Customized performance-based ads help advertisers reach and convert target audiences


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FY17 FY18

Brand Ads Performance-based Ads

Advertising revenue: strong growth with great potential

RMB (mm)


Up 60%YOY

18Q1 19Q1

Brand Ads Performance-based Ads

159

463

70

112

Up 191%YOY

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OUR FINANCIALS

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Expanding user base and increasing paying ratio

Notes: (1) Average monthly active users for each of the quarters (includes both PC and mobile). Starting from the first quarter of 2019, we count mobile MAUs of Bilibili Comic and Maoer towards our 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 to 80.5% in Maoer Inc., operator of Maoer app. In the first quarter of 2019, Bilibili Comic and Maoer in an aggregate contributed to 3.2 million of our MAUs.

(2) Calculated as average monthly paying users (MPU) in each period divided by average MAUs in each period. MPUs are calculated by number of users who paid for games, live broadcasting, premier membership, Bilibili Comics services and Maoer, after eliminating duplicates of users paid for multiple services other than users of Maoer.

Total MAUs(mm)

Y-o-Y Growth % 31%

Impressive growth of paying users

MPUs (thousands)

MPUs / MAUs (%)

2018 | 3.8% 18Q1 | 3.2% 19Q1 | 5.7%

(1)

(2)

17Q1 17Q2 17Q3 17Q4 18Q1 18Q2 18Q3 18Q4 19Q1

854 1,073 1,174 1,109

2,473 2,966

3,540

4,416

5,743

17Q1 17Q2 17Q3 17Q4 18Q1 18Q2 18Q3 18Q4 19Q1

5765

74 7277

8593 93

101

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17Q1 17Q2 17Q3 17Q4 18Q1 18Q2 18Q3 18Q4 19Q1

7.48.9

9.8 10.211.2

12.1 11.612.5

13.6

17Q1 17Q2 17Q3 17Q4 18Q1 18Q2 18Q3 18Q4 19Q1

Mobile games Live broadcasting and VASAdvertising E-commerce and Others

Rapid growth of revenue and revenue per MAURevenue(RMB mm)

Y-o-Y Growth % 58%

Quarterly Total Revenue / MAU(RMB)Y-o-Y Growth % 21%

1,027

868

734728

583

424

1,1561,079

1,374

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Cost of revenue and operating expenses

(1) Excluding Share-based compensation(2) Revenue-sharing costs consist of fees paid to game developers, distribution channels (app stores) and payment processors, as well as fees we pay to hosts of our live broadcasting program and content creators in accordance with our revenue-sharing arrangements.(3) Content costs consist of amortized costs of purchased licensed content from copyright owners or content distributors.(4) Server and bandwidth costs are the fees we pay to telecommunication carriers and other service providers for telecommunication services, hosting our servers at their internet data centers, and providing content and application delivery services.(5) Others includes staff cost, depreciation, and others.

Notes:

Cost of Revenue (1)(RMB mm; as a percentage of revenue %)

Gross margin %

Operating Expenses (1)(RMB mm)

As a percentage of revenue

39.4%30.7%27.9% 38.8%18.7%25.2%25.5% 17.5%

18Q1 18Q2 18Q3 18Q4 19Q1

39% 41% 41% 38%40%

11%12% 14% 15%

15%

15%

14%15% 16%

16%

10%

8%11%

14%

15%

Revenue-sharing costs Content costs Server and bandwidth costs Others

14.2%

18Q1 18Q2 18Q3 18Q4 19Q1

9%12%

18% 16% 13%8%7%

8% 12% 8%11%

12%

13%12% 13%

Sales and marketing expenses General and administrative expensesResearch and development expenses

33.9%

647

768877

954

1,179

242

315

418455 466

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Consolidated balance sheets(RMB MM)

31-Dec-2018 31-Mar-2019 Assets

Cash and cash equivalents 3,540 2,715 Time deposit 749 769 Accounts receivable, net 324 542 Receivable due from related parties -- 24 Prepayments and other current assets 991 1,198 Short-term investments 946 1,059

Total current assets 6,550 6,307

Property, equipment and software, net 395 363 Production cost 204 219 Intangible assets, net 1,420 1,363 Good will 941 941 Long-term Investments 980 1,228 Other long-term assets -- 253

Total non-current assets 3,940 4,367 Total Assets 10,490 10,674

LiabilitiesAccounts payable 1,308 1,425 Salary and welfare payables 247 148 Taxes payable 39 41 Short-term loans -- 100 Deferred revenue 985 1,289 Accrued liabilities and other payables 670 484 Amount due to related parties 50 30

Total current liabilities 3,299 3,517 Other long-term liabilities -- 218

Total non-current liabilities -- 218 Total Liabilities 3,299 3,735

Total Bilibili Inc.’s shareholders’ (deficit)/equity 6,951 6,704 Non-controlling interests 240 235

Total shareholders’ (deficit)/equity 7,191 6,939

Total Liabilities, Mezzanine and Shareholders' Equity 10,490 10,674

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Consolidated statements of operations and comprehensive loss(RMB MM, unless otherwise stated)

18Q1 18Q4 19Q1 YoY ChangeNet revenues

Mobile games 688 713 873 27%Live broadcasting and VAS 96 202 292 205%Advertising 70 160 112 60%E-commerce and Others 13 81 96 621%

Total net revenues 868 1,156 1,373 58%Cost of revenues (655) (959) (1,184) 81%Gross profit 213 197 189 -11%

Sales and marketing expenses (79) (182) (182) 130%General and administrative expenses (103) (150) (128) 25%Research and development expenses (106) (154) (186) 76%

Total operating expenses (287) (486) (496) 73%Loss from operations (74) (289) (307) 313%

Investment (loss)/income, net 25 75 82 222%Interest income 1 27 24 2799%Exchange (losses)/gains (10) (5) (2) -79%Others, net 3 10 15 351%

Loss before tax (55) (182) (188) 243%Income tax (3) (9) (8) 158%

Net loss (58) (191) (196) 238%Adjusted net loss (3) (152) (145) 4498%

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THANK YOU!IR Contacts

Bilibili Inc.

Juliet YangTel: +86-21-2509 9255 Ext. 8523E-mail: [email protected]

The Piacente Group, Inc.

Tel: +86-21-6039-8363 (In China)Tel: +1-212-481-2050 (In U.S.)E-mail: [email protected]

bilibili 1q19 investor presentation-fina

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