"Sang Mou" (Three Strategies) has made great contributions, and the game has once again propped up Bilibili.

Text by | Wang Yuchan

Edited by | Qiao Qian

In the first quarter of 2025, Bilibili continued to achieve profitability.

During this quarter, Bilibili's revenue reached 7.00 billion RMB, a year - on - year increase of 24%. Gross profit increased significantly, with a year - on - year growth of 58%. The gross profit margin increased quarter - on - quarter for 11 consecutive quarters to 36.3%. The adjusted net profit reached 360 million RMB, achieving continuous profitability.

The profitability stems from the increased proportion of high - margin game and advertising revenues. The revenue contribution of these two businesses in Q1 reached 54% (47% in the same period last year), while the absolute value of quasi - fixed costs remained basically stable, and the proportion of revenue decreased from 25% in the same period last year to 20% this quarter. At the same time, the gross profit margins of advertising and live - streaming also increased this year.

At the earnings conference call, the management provided guidance on medium - and long - term financial data, stating that "we are confident to increase the gross profit margin to 40% - 45%" and "the Non - GAAP operating profit margin to 15% - 20%". With the in - line earnings report and optimistic guidance, Bilibili's stock rose more than 7%.

In terms of user data, in the first quarter, Bilibili's daily active users reached 107 million, and the monthly active users reached a new high of 368 million, a year - on - year increase of 7.8%, with a net increase of 28 million quarter - on - quarter, exceeding market expectations, which may reflect the user growth brought by the cooperation with the Spring Festival Gala. In addition, the average daily usage time per user also reached a record high of 108 minutes, and the per - capita interaction volume (likes/comments/favorites) and the average daily video views increased by 2% and 20% respectively.

Can "Three Kingdoms: Strategize the World" Become Bilibili's Next Long - running Game?

In the first quarter, Bilibili's game business performed quite well, achieving revenue of 1.73 billion RMB, a year - on - year increase of 76%. This significant growth was mainly driven by the game "Three Kingdoms: Strategize the World" (hereinafter referred to as "Three Strategies") and the low - base advantage of the same period last year.

Nearly a year has passed since the launch of "Three Strategies". Considering the natural growth cycle of mobile games, the outside world originally expected the game's revenue to decline, but the performance of the game business this quarter seems to prove that this game can go further.

At the earnings conference call, CEO Chen Rui said that the most important requirement for "Three Strategies" is long - term operation. "The most discussed topics in my meetings with the project team are user activity and retention, especially the long - term retention of loyal users. My requirement for this project is to have a stable life cycle of at least five years, and I hope it can be longer. I said 'we should make a game that users can play until they are old'." Chen Rui said.

Bilibili's expectations for "Three Strategies" are at a strategic level. As Chen Rui said, when asked about Bilibili's next step in the SLG track, his answer was that the next new game in SLG is the next season of "Three Strategies". There are two new attempts for "Three Strategies" in the future: one is to plan to launch a traditional Chinese version of "Three Strategies" at the end of this year, targeting users in Hong Kong, Macau, and Taiwan; the other is to gradually develop "Three Strategies" for multiple platforms. In Q4 last year, Bilibili had already launched the PC version of "Three Strategies", and next, it will also try the mini - game version of "Three Strategies", which will be launched during the summer vacation.

At a time when the number of game pipelines in game companies is generally shrinking, the importance of having long - running games has been emphasized again and again. Bilibili is not short of experience in operating long - running games. This month marks the eighth - anniversary celebration of "Azur Lane", and July will see the ninth - anniversary celebration of "Fate/Grand Order". Bilibili said that "Azur Lane" has been operating steadily, with occasional user growth. It is expected that both the eighth - anniversary of "Azur Lane" and the ninth - anniversary of "Fate/Grand Order" will see a peak in user activity.

In addition, regarding new games, Chen Rui said that Bilibili has four to five games ready and is waiting for game licenses. It is quite worth looking forward to that in November last year, Bilibili cooperated with CyberAgent to officially launch the global distribution of the mobile game adapted from the hit IP "Jujutsu Kaisen: Phantom Night Walk" outside Japan, and it ranked among the top 20 in the free iOS charts in 124 countries. If this game can be successfully launched in the Chinese mainland market as soon as possible, it will also give a considerable boost to Bilibili's game business.

However, it should be noted that the year - on - year increase in the promotion expenses of "Three Strategies" will also lead to a short - term increase in the company's sales and marketing expenses. This quarter, this expense was 1.167 billion RMB (161 million US dollars), a 26% increase compared to the same period in 2024. In addition to the increased expenses brought by the game, it was also because of the one - time marketing expenses related to Bilibili's cooperation with the Spring Festival Gala.

Advertising Growth: Mediocre

In terms of advertising, the business revenue in the first quarter was 2.00 billion RMB, a year - on - year increase of 20%, in line with market expectations. Considering that the macro - market is still in a slow recovery and Bilibili's advertising business is on track without the low - base advantage of the previous quarter, this result is mediocre.

The growth of Bilibili's advertising revenue this quarter is related to AI at two levels: first, AI has improved advertising efficiency; second, AI manufacturers, as advertisers, have made more investments on Bilibili.

"The capabilities of AI and large models grew rapidly in the first quarter. Through multi - modal large models, we have a deeper understanding of users' consumption intentions and interests." Chen Rui said. "Therefore, we received more budget investments for in - depth conversions. The proportion of in - depth conversions in Q1 this year doubled compared to Q1 in 2024, directly promoting a significant increase in the eCPM of our performance advertising." This quarter, performance advertising still outperformed the overall market, with a year - on - year growth of more than 30%.

Moreover, because the product form of Bilibili's double - page waterfall flow on the home page is quite special, different from the common full - screen information flow of short - video products, advertising materials also need to be re - matched with great efforts. Now, these tasks can be handed over to AIGC tools. Chen Rui said that currently, the creativity generated by AIGC covers 30% of the consumption of performance advertising.

In addition to enabling, AI has also directly brought in money. AI manufacturers have been one of the most generous advertisers in the advertising industry in the past year. As Chen Rui said, in Q1 this year, the advertising investment related to AI on Bilibili doubled, directly driving the advertising investment in the online service field.

Beyond these industry - wide benefits, looking into the long - term, where lies the certainty of Bilibili's advertising business in the future? When Bilibili was listed on the NASDAQ in 2018, the secondary market believed that Bilibili's greatest charm was that it captured the attention of young people, and thus should influence their future consumption decisions. This year, the average age of Bilibili's users has reached 26, becoming a group with stronger consumption power. It seems to be the time to fulfill the promise.

In the first quarter of this year, games, online services, e - commerce, home appliances, and automobiles were the top five industries contributing to Bilibili's advertising revenue. More than 100 million people consumed home appliance content on Bilibili, driving a nearly 40% increase in related advertising revenue; the advertising revenue related to mother - and - baby products and pets increased more than three times year - on - year, proving that users' consumption behavior is maturing with age. At a time when confidence in the advertising market has not fully recovered, perhaps "time" itself is the most certain positive factor for Bilibili's advertising business.