Shares of Bilibili-W (09626) rose more than 5% in Hong Kong trading.

At the time of writing, the stock was up 5.03% to HK$150.3, with a turnover of HK$9.57 billion.

The movement follows the company's recent release of its first-quarter 2026 financial results.

Analysis from Guosen Securities highlighted that the company achieved robust revenue growth and continued improvement in profitability for Q1 2026.

Total revenue reached RMB 7.472 billion, marking a 7% year-over-year increase.

The gross margin improved to 37.1%, up 0.8 percentage points from the prior year, representing the 15th consecutive quarter of margin expansion.

Adjusted net profit was RMB 585 million, surging 62% year-over-year, resulting in an adjusted net profit margin of 7.8%.

The company maintained healthy operating cash flow, with net cash of approximately RMB 14.6 billion.

In terms of business segments, advertising revenue grew by 30% year-over-year, marking the 13th consecutive quarter of double-digit growth, solidifying its role as the core growth engine.

Notably, ad budgets from AI-related advertisers soared by 170% compared to the same period last year.

Great Wall Securities noted that Bilibili-W continues to leverage AI technology to refine its advertising algorithms.

This enhances insights into user interests and long-term behavior patterns, significantly improving the match between users and advertisements.

In Q1 2026, the click-to-conversion rate for performance ads increased by 25% year-over-year.

Furthermore, AIGC tools are streamlining the ad creative production process, helping advertisers connect with users through content that better aligns with the community's tone, leading to higher click-through rates.

The brokerage believes that, based on the expansion of its user base, diversified new scenarios, and continuous efficiency improvements, the company's advertising business is poised to maintain strong growth momentum.