Key Takeaways:
Bilibili reported Q2 net profit of RMB339.1 million, up 55% from a year earlier, as advertising revenue climbed 28% to become its largest segment.
"In an era where content is abundant yet attention is scarce, quality and emotional connection matter more than ever," Chairman and Chief Executive Officer Rui Chen said.
Total net revenues rose 8% year over year to RMB7.94 billion (US$1.17 billion), beating the US$1.16 billion consensus. Adjusted net profit increased 25% to RMB703.6 million, with adjusted EPS of US$0.23 topping the US$0.18 estimate. Advertising revenue of RMB3.13 billion accounted for nearly 40% of total revenue, while value-added services grew 5% to RMB2.97 billion. Mobile games revenue fell 14% to RMB1.39 billion on a high base from San Guo: Mou Ding Tian Xia, which has entered a mature lifecycle. IP derivatives and other revenue rose 2% to RMB449.8 million.
Gross margin expanded to 37.2% from 36.5% a year earlier, the 16th consecutive quarter of improvement, while operating profit rose 48% to RMB372.9 million. Daily active users reached 116.5 million, up 7%, with total user time spent up 14%. The company held RMB24.30 billion in cash and repurchased about US$118 million of shares in 2026.
Research and development expenses rose 16% to RMB1.01 billion, driven by higher server depreciation costs, while sales and marketing spending grew just 1% to RMB1.06 billion. General and administrative expenses were flat at RMB510.8 million. The cost discipline helped operating leverage, with net profit margin widening to 4.3% from 3.0% and adjusted net profit margin reaching 8.9%.
The advertising acceleration positions Bilibili, often compared with Alphabet's YouTube for its long-form user-generated video, to monetize its 371 million monthly active users more effectively. CFO Sam Fan said the company will maintain investment discipline and continue returning value through its share repurchase program. Under the two-year US$300 million program approved in June, Bilibili purchased 1.9 million securities for about US$31.3 million by June 30.
The results mark a shift from narrowing losses to profit expansion, with advertising now the primary growth engine. Investors will watch whether Bilibili can sustain advertising momentum and launch a new hit game to offset the mobile games decline in coming quarters.
This article is for informational purposes only and does not constitute investment advice.
