BiliBili total revenue was up by 11% YoY and 18% QoQ to RMB5.8bn in 3Q22, in line with consensus/our estimate of RMB5.7/5.8bn. Adjusted net loss widened by 9% YoY but narrowed by 10% QoQ to RMB1.76bn in 3Q22, better than consensus/our estimate of RMB1.83/1.97bn, due to solid GPM expansion (+3.2pct QoQ) and effective control in marketing expenses (-25% YoY). For 4Q22E, the company guided total revenue to increase by 4-7% YoY to RMB6.0-6.2bn, with YoY growth slowing due to relatively soft advertising and mobile game businesses.Looking forward, Bili will focus more on DAU (rather than MAU) growth and user quality to improve monetization efficiency and control expenses. We maintain FY- 22-24E revenue forecast largely unchanged but narrowed FY22-24E adjusted net loss forecast to RMB7.0/4.2/1.8bn (previous: RMB7.7/5.2/2.6bn) on better expense control. We lift SOTP-based TP by 5.0% to US$21.0. Maintain BUY.
　　Monetization well on track. VAS revenue increased by 16% YoY to RMB2.2bn (38% of total revenue) in 3Q22 and was inline with our estimate, driven by solid growth of its live streaming MPUs (+79% YoY). Bili’s integration of the PUGV and live streaming ecosystem continues to make progress, with the number of live broadcasters up by 67% YoY in 3Q22. Mobile game revenue recorded YoY growth of 5.7% to RMB1.5bn in 3Q22 (25% of total revenue), due to the newly launched games. Bili’s investment in game development capability began to bear fruit, with its self-developed games already accounting for 9% of mobile game revenue in 3Q22. Ad revenue grew by 16% YoY to RMB1.4bn in 3Q22 (23% of total revenue), supported by resilient growth of performance ad revenue.We expect ad revenue to be flattish YoY in 4Q22E, due to the high-base effect and macro challenges.
　　Shifting focus from user growth to user quality. Bili’s average MAUs in 3Q22　was up by 25% YoY and 9% QoQ to 333mn, with solid enhancement in marketing efficiency (S&M expenses: -25% YoY). User quality also further improved in 3Q22. Average time spend per DAU grew by 9% YoY to a record- high of 96 minutes; and average daily video views grew by 64% YoY to 3.7bn in 3Q22. Looking ahead, Bili will put more emphasis on DAU growth and user quality to drive its DAU/MAU ratio to c.30% in 2023E (3Q22: 27%), while the company also remains confident in achieving its 400mn MAU target by 2023E.
　　Maintain non-GAAP OP breakeven target in FY24E. Gross margin expanded　by 3.2pct QoQ to 18.2% in 3Q22, attributable to the recovery of higher-margin ads & mobile game business, and the control in content investment. Bili’s expenses control initiative led to a ｄｒｏｐ of its total opex ratio from 55.6/59.7% in 3Q21/2Q22 to 50.1% in 3Q22. S&M expenses declined by 25% YoY to RMB1.2bn in 3Q22, equivalent to 21.1% of total revenue (3Q21/2Q22: 31.4/23.9%). Overall, adjusted net margin improved from -31.0/-40.0% in 3Q21/2Q22 to -30.4% in 3Q22. Management expects further decline in opex and narrowing net loss in 2023E, as the company optimizes its organizational structure (which will be completed by 4Q22) and controls marketing expenses.
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【免责声明】本文仅代表第三方观点，不代表本站立场。投资者据此操作，风险请自担。