BILIBILI(HK:09626)2024-08-26 13:43Investment Rating - The report maintains a "Buy" rating for Bilibili (09626) [3][4] Core Insights - Bilibili's Q2 2024 revenue reached 6.13 billion CNY, a year-on-year increase of 16%, slightly exceeding consensus expectations, with a narrowing adjusted net loss of 270 million CNY [3][4] - The company reported a net operating cash flow of 1.75 billion CNY, an increase of 1.11 billion CNY from Q1 [3] - Deferred revenue as of June 30 was 3.7 billion CNY, up 740 million CNY from March, indicating certainty in future revenue growth [3] User Engagement - Bilibili's Q2 Monthly Active Users (MAU) stood at 336 million, a year-on-year increase of 4%, with Daily Active Users (DAU) at 102 million, up 6% [4] - The DAU/MAU ratio improved to 30.4%, and average daily usage time per user increased by 5 minutes to 99 minutes [4] Financial Projections - The adjusted net profit forecasts for 2024-2026 have been revised to -45 million CNY, 1.512 billion CNY, and 3.067 billion CNY respectively, up from previous estimates of -415 million CNY, 1.028 billion CNY, and 1.882 billion CNY [4] - Revenue projections for 2024-2026 are set at 26.537 billion CNY, 31.046 billion CNY, and 33.278 billion CNY, reflecting growth rates of 18%, 17%, and 7% respectively [5] Gaming Performance - Q2 gaming revenue was 1 billion CNY, a year-on-year increase of 13%, exceeding expectations [6] - The performance of the game "Three Kingdoms: Strategy" is expected to significantly contribute to revenue in H2 2024 [6] Advertising Growth - Q2 advertising revenue reached 2 billion CNY, a historical high with a year-on-year growth of 30% [6] - Growth was driven by improvements in e-commerce advertising and enhanced efficiency from AI [6] Value-Added Services - Revenue from value-added services in Q2 was 2.6 billion CNY, a year-on-year increase of 11%, slightly below expectations [6] - Revenue from IP derivatives and other services was 500 million CNY, down 4% year-on-year [6] Profitability Improvement - Q2 gross margin was 29.9%, an increase of 6.8 percentage points year-on-year and 1.6 percentage points quarter-on-quarter [6] - The company has achieved eight consecutive quarters of gross margin improvement, with effective cost control in G&A and R&D expenses [6]