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How far is Bilibili from breaking even?
1. The growth rates of all major businesses are slowing down, which is an indisputable fact. The improvement in gross margin mainly relies on the reduction in revenue-sharing ratios for content creators (UPs) and decreased marketing expenses.
2. It’s understandable that Bilibili is eager to turn a profit now, even if it risks offending creators. However, the results aren’t very noticeable. One reason is that Bilibili has always aimed to compete with leading long-video platforms, transitioning from an ACG-focused platform to a mainstream one, resulting in soaring copyright acquisition costs without solving the profitability issues of long-form videos. On the other hand, the rise of short-video platforms has diverted attention, and many UPs have moved to short-video platforms to build larger brands, meaning culture and content are no longer exclusive.
3. What Bilibili needs to consider now is: 1) Whether it can find a way to break through the challenges posed by short videos; 2) Whether the unique cultural attributes of Gen Z can be strengthened. Personally, I lean towards the latter.
4. Bilibili’s management should adjust their mindset from when the stock price surged previously, remain modest, avoid impatience, and refrain from reckless spending.
1. The growth rates of all major businesses are slowing down, which is an indisputable fact. The improvement in gross margin mainly relies on the reduction in revenue-sharing ratios for content creators (UPs) and decreased marketing expenses.
2. It’s understandable that Bilibili is eager to turn a profit now, even if it risks offending creators. However, the results aren’t very noticeable. One reason is that Bilibili has always aimed to compete with leading long-video platforms, transitioning from an ACG-focused platform to a mainstream one, resulting in soaring copyright acquisition costs without solving the profitability issues of long-form videos. On the other hand, the rise of short-video platforms has diverted attention, and many UPs have moved to short-video platforms to build larger brands, meaning culture and content are no longer exclusive.
3. What Bilibili needs to consider now is: 1) Whether it can find a way to break through the challenges posed by short videos; 2) Whether the unique cultural attributes of Gen Z can be strengthened. Personally, I lean towards the latter.
4. Bilibili’s management should adjust their mindset from when the stock price surged previously, remain modest, avoid impatience, and refrain from reckless spending.
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