[Management View]
Bilibili Inc. (BILI) reported total net revenues of RMB 7 billion for Q1 2025, representing a 24% year-over-year growth. Key drivers included a 20% increase in advertising revenue and a 76% rise in game revenue. The company emphasized its focus on high-quality content and user engagement, with average daily time spent reaching a record 108 minutes.

[Outlook]
Management targets a mid- to long-term gross profit margin of 40% to 45% and a long-term operating margin of 15% to 20%. Future plans include the international expansion of the "Sunmo" game and leveraging AI to enhance user experience and monetization.

[Financial Performance]
- Total Revenue: RMB 7 billion, up 24% YoY
- Advertising Revenue: RMB 2 billion, up 20% YoY
- Game Revenue: RMB 1.73 billion, up 76% YoY
- Gross Profit: RMB 2.54 billion, up 58% YoY
- GAAP Net Loss: Narrowed by 99% to RMB 11 million
- Adjusted Net Profit: RMB 362 million, positive versus a loss in the prior year

[Q&A Highlights]

Question 1: What are Bilibili's plans to enhance user engagement with quality content and AI applications?
Answer: Bilibili focuses on high-quality content to meet the growing demand for premium content. The company aims to help content creators gain fans and monetize their work. AI applications will enhance content creation and commercialization efficiency. Bilibili's extensive video content repository provides a unique advantage in AI-related opportunities.

Question 2: Can management review the performance of the "Sunmo" game and its future plans?
Answer: The goal is to achieve long-term healthy operation for "Sunmo" with at least a five-year life cycle. The game has shown strong user retention and engagement. Future plans include launching an international version and expanding to multiple devices. The company also aims to sustain legacy titles and explore new game genres.

Question 3: What are the drivers behind the strong advertising revenue growth, and what is the outlook for the future?
Answer: Key drivers include high-value users, strong brand association with quality content, and AI-related product improvements. The company expects continued growth in ad revenue, driven by performance-based ads and emerging sectors like AI. Bilibili remains confident in maintaining above-industry-average growth.

Question 4: What is the outlook for margin trends and long-term targets?
Answer: Bilibili expects gradual improvement in gross and net margins throughout the year. The mid- to long-term gross profit margin target is 40% to 45%, and the long-term operating margin target is 15% to 20%. Operating expenses as a percentage of total revenues are expected to decline.

[Sentiment Analysis]
Analysts and management maintained a positive tone, highlighting strong financial performance and confidence in future growth. Management emphasized strategic priorities and efficiency improvements.

[Quarterly Comparison]
| Metric | Q1 2025 | Q1 2024 | YoY Change |
|-------------------------|---------------|---------------|------------|
| Total Revenue | RMB 7 billion | RMB 5.65 billion | +24% |
| Advertising Revenue | RMB 2 billion | RMB 1.67 billion | +20% |
| Game Revenue | RMB 1.73 billion | RMB 0.98 billion | +76% |
| Gross Profit | RMB 2.54 billion | RMB 1.61 billion | +58% |
| GAAP Net Loss | RMB 11 million | RMB 1.1 billion | -99% |
| Adjusted Net Profit | RMB 362 million | -RMB 452 million | Positive |

[Risks and Concerns]
Potential risks include market competition, regulatory changes, and the ability to sustain user engagement and monetization. The success of new game launches and international expansion also poses uncertainties.

[Final Takeaway]
Bilibili demonstrated strong financial performance in Q1 2025, driven by significant growth in advertising and gaming segments. The company's focus on high-quality content and strategic use of AI positions it well for future growth. Management's confidence in achieving long-term margin targets and expanding its user base underscores a positive outlook for investors.