Key Takeaways:
Bilibili Inc. (9626.HK) jumped 4.7% to HKD157.7 in Hong Kong, as investors bought into the Chinese video platform ahead of its first-quarter results expected after Tuesday's market close.
"CLSA forecast Bilibili to maintain solid revenue growth in 1Q, with further improvement in profitability," the brokerage said in a note. The firm anticipates the company will report a 7% year-over-year increase in revenue to RMB7.5 billion.
The market consensus aligns with this view, projecting revenue of RMB7.51 billion and earnings per share of 1.17 yuan, a 37.7% increase from the prior year. CLSA analysts are calling for an adjusted net profit of RMB543 million for the quarter. The key question for investors is whether Bilibili's booming advertising business can offset a continued slump in its gaming division.
The focus on profitability comes after Bilibili achieved its first full-year GAAP profit in 2025. Advertising has been a core driver, with growth exceeding 20% in recent quarters as the company uses AI to enhance ad targeting. However, the gaming unit has seen revenue decline from a run rate of 1.7 billion yuan in mid-2025 to around 1.5 billion yuan as its last hit title entered a "natural downcycle," according to Morgan Stanley.
Wall Street remains broadly optimistic, with 30 of 31 analysts covering the stock maintaining a buy rating. Morgan Stanley upgraded Bilibili to Overweight in April, raising its price target to $31, citing better visibility into three new games expected in the second half of 2026. BOCI noted in a report that while recent selling pressure was linked to market concerns over a potential stake sale by major shareholder Tencent, Bilibili's fundamentals remain strong.
The upcoming results will be a key test of whether the company's diversified monetization strategy can bridge the gap while it awaits a rebound in its gaming fortunes. Investors will be closely watching the earnings call for any updates on the new game pipeline and the outlook for gross margins.
This article is for informational purposes only and does not constitute investment advice.
