Bilibili: Gen-Z video hub on the road to profitability

Administrateur
6 days ago
3 min read

Bilibili has established itself as the cultural crossroads of China’s Generation Z: more than 340 million monthly active users, roughly 100 million daily active users, and almost 100 minutes of average daily viewing time. Built on four pillars—community video, live-streaming, mobile games and advertising—the platform grew revenue by about 20 % per year between 2019 and 2024, reaching RMB 26.8 billion. In Q4 2024 it posted its first GAAP net profit (RMB 89 million) and aims for sustainable full-year profitability by 2026-2027 through tighter cost discipline and better monetisation of its audience.

Business activities and model

Originally launched as an ACG-focused animation platform, Bilibili now offers:

Community video: user-generated and professional content enhanced by real-time “bullet-screen” comments that deepen engagement.
Live-streaming & value-added services (VAS): premium subscriptions, virtual tipping and ticketed events, generating almost RMB 11 billion in 2024.
Mobile games: publishing and distribution of exclusive titles, led by the hit San Guo: Mou Ding Tian Xia, which lifted gaming revenue above RMB 5 billion.
Advertising: in-feed ads, interactive videos and AI-driven performance marketing, contributing RMB 8.2 billion in 2024.

The revenue mix now splits across VAS (~41 %), advertising (~31 %), games (~21 %) and derivative products/other (~7 %), making the company less reliant on a single segment.

Markets and competition

Roughly 95 % of Bilibili’s users are in mainland China, especially in lower-tier cities. Internationally, the company distributes anime and e-sports content in South-East Asia and Latin America via licensing deals and its YouTube channel.

Key rivals are Douyin/TikTok and Kuaishou for short video, Tencent Video and iQIYI for long-form streaming, while Xiaohongshu dominates social recommendations. Bilibili retains an edge in engagement thanks to its participatory ecosystem and loyal community (DAU/MAU ratio above 30 %).

Shareholding and governance

Rui Chen, founder-CEO, controls ~12 % of the equity through high-voting shares.
Tencent Holdings owns ~18 %, providing strategic support in cloud, gaming and advertising.
Sony Group holds ~5 % following a US $400 million investment aimed at co-producing anime and leveraging Japanese IP.
The free float—held by institutions and retail investors—is split between Nasdaq ADRs and Hong Kong H-shares.

This structure aligns management with two tech giants, ensuring privileged access to game licences and content catalogues.

Growth drivers 2019-2024

Audience boom: MAUs rose from 128 million to 340 million, with average daily watch time at 99 minutes.
Revenue diversification: advertising and VAS now account for more than 70 % of sales.
Tech optimisation: recommendation algorithms, programmatic buying and integration with Tencent’s ad engine.
Cost control: steady cuts in marketing spend and leaner operating expenses, delivering operating leverage.

Growth outlook

Opportunities

Advertiser budget migration: TV ad spend is shifting online, giving Bilibili room to raise ad revenue per user.
Exclusive game pipeline: a dozen titles slated for 2025-2026 to cushion any advertising slowdown.
AI-generated content: in-house assisted-animation projects to lower costs and enrich the catalogue.

Risks

Regulation: potential youth-usage limits and stricter content controls.
Douyin competition: heavy investment in long-form video could steal screen-time.
Infrastructure costs: 4 K streaming lifts bandwidth needs, risking margin erosion without CDN optimisation.

Analysts still forecast double-digit top-line growth through 2027.

Path to profitability

The first profitable quarter in Q4 2024 (gross margin 36 %) was a turning point. Management targets:

Full-year profitability from 2026 with net income near RMB 1 billion.
Higher ad revenue per user via AI and native formats.
Content-cost stabilisation through in-house productions and Sony co-productions.
Marketing ratio capped below 20 % of sales.
Bandwidth economies of scale through Tencent cloud solutions.

Conclusion

Bilibili combines a young, highly engaged audience, a diversified revenue mix, and the strategic backing of major partners. If it can boost monetisation without harming user experience, keep costs in check and adapt to regulatory shifts, the company is poised to turn its quarterly success into sustainable annual profitability within two to three years—joining the select group of profitable global video platforms.