CICC: BILIBILI-W Accelerates Advertising Efforts with Higher Investment; Target Price Increased to HKD232

BILIBILI-W 4Q Results: BILIBILI-W reported a 7.6% year-over-year revenue growth in 4Q25, reaching RMB8.321 billion, exceeding market expectations.

Profit Performance: The non-GAAP net profit for the quarter was RMB878 million, significantly higher than both CICC's and market forecasts, driven by strong advertising revenue and tax expense variations.

Future Outlook: CICC maintained its non-GAAP net profit forecasts for 2026-27 and an Outperform rating, noting that while AI investments may impact short-term profits, they are beneficial for long-term growth.

Target Price Adjustment: Following the positive results, CICC raised BILIBILI-W's target price by 5.5% to HKD232, reflecting confidence in the company's future performance.

Stock Performance: BILIBILI-W (09626.HK) experienced a decline of 3.609%, with short selling reaching $349.52 million and a ratio of 38.757%.

4Q25 Financial Results: The company reported 4Q25 revenue of RMB8.3 billion, an 8% year-over-year increase, surpassing expectations by 2%.

2026 Outlook: Management is optimistic about user growth and advertising revenue, with a stable start anticipated for 1Q26, supported by AI investments and improved advertising strategies.

Analyst Rating: Goldman Sachs has rated BILIBILI-W as a Buy, setting target prices of $266 for H-shares and $34.2 for US stocks.

Investment in AI: BILIBILI-W plans to moderately increase its AI investments this year, with a focus on reinvesting new profits into AI applications that align with its core business, as stated by CFO Fan Xin during the earnings call.

Content Growth: The platform has seen a significant increase in AI-assisted high-quality content, with viewing time for such content growing by 100 times year-over-year, according to Chairman and CEO Chen Rui.

Financial Performance: BILIBILI-W reported a 93.8% increase in adjusted net profit for Q4 2025, reaching RMB 878 million, and saw a 3.2% rise in US shares pre-market.

Short Selling Activity: The stock experienced short selling of $382.28 million, with a short selling ratio of 34.341%.

Stock Performance: BILIBILI-W (09626.HK) experienced a decline of 1.614%, with short selling amounting to $382.28M and a ratio of 34.341%.

Earnings Call Insights: During the 4Q25 earnings call, CFO Fan Xin projected a slight quarter-over-quarter increase in gross margin for 1Q26, alongside an expected year-over-year improvement in adjusted operating profit margin.

Financial Performance: BILIBILI-W reported a 93.8% increase in adjusted net profit for 4Q25, reaching RMB878 million, while total net revenues grew by 7.6% year-over-year to RMB8.321 billion.

User Engagement: The company saw a 10% year-over-year increase in average daily active users (DAUs), reaching 113 million, with advertising revenues rising approximately 27% to RMB3.04 billion.