Every reporter: Wen Menghua Every editor: Liang Xiao
On November 29, Bilibili handed over its "report card" for the third quarter of 2023.
According to the financial report, the total revenue of Station B in the third quarter was 5.81 billion yuan, the same as the same period in 2022, the net loss was 1.3 billion yuan, 22% narrower than the same period in 2022, and the adjusted net loss was about 864 million yuan, a year-on-year decrease of 51%.
Since last year, moving towards breakeven has always been the "small goal" of Station B. In the third quarter, the advertising and value-added services business increased by 21% and 17% year-on-year, respectively, carrying the revenue banner of Bilibili, while the game business of Bilibili, led by Chairman and CEO Chen Rui, achieved revenue of 990 million yuan in the third quarter, a decrease of 33% compared with the same period in 2022.
That night, in the earnings call, Chen Rui focused on responding to the current situation of the game business of Station B and the current changes in the game industry, once again emphasizing the nine words of "increasing gross profits, reducing losses, and maintaining growth", and said that these three points should be done at the same time, and the first two points will not be sacrificed for user growth.
The daily active users exceeded 100 million for the first time, "the number of users is the core competitiveness of the Internet"
For Internet platforms, users and traffic have always been the "cornerstones" that support the rapid growth of the platform. In the third quarter of this year, the average daily active users of Station B successfully entered the "era of over 100 million" for the first time.
According to the data, in the third quarter, the average daily active users of Bilibili increased by 14% year-on-year to 103 million, and the average monthly active users reached 341 million, and the average daily usage time of users exceeded 100 minutes for the first time. As of the end of the third quarter, the number of "regular members" who passed the exam at station B reached 224 million, a year-on-year increase of 23%, and the retention rate of regular members in the 12th month has always remained stable at about 80%.
Image source: Visual China-VCG111425282859
"This fully demonstrates that the user growth strategy of the past year has been successful, and the DAU (number of daily active users) exceeded 100 million is also a new beginning. Chen Rui said frankly that we are still in the wave of video, as a video product, as long as you do it well, in the current time period, its users should be bigger and bigger. When we talk about user growth, we mainly talk about doing a good job of the product, rather than increasing customer acquisition investment.
In the past year, the healthy growth of DAU has been frequently mentioned by Bilibili and Chen Rui. In the face of investors' doubts that "shouldn't the most important thing at this stage be revenue growth", Chen Rui believes that the number of users is the core competitiveness of all Internet platform products, and at the same time, as an Internet platform product, the basis of commercialization is the number of users. "Behind the rapid growth of advertising and live streaming in our revenue, we have run through a positive cycle from the growth of user scale to commercial growth. ”
According to the financial report, with the "assistance" of the growth of the platform's user scale and community traffic, the total advertising revenue of Station B in the third quarter reached 1.64 billion yuan, a year-on-year increase of 21%, of which the top five advertiser industries were games, digital home appliances, e-commerce, food and beverage and automobiles, and the revenue of value-added services reached 2.6 billion yuan, a year-on-year increase of 17%.
Chen Rui said that in the future, he will continue to do the natural growth of users, and at the same time, in the process of market launch, he will also strictly assess the ROI (return on investment) to ensure that the efficiency of market launch is positive. "We will achieve our goal of increasing our users while making money. ”
Cut the game of not making money, "following the trend of project approval will not work"
Compared with advertising and value-added services, the game business, which was once regarded as the "cash cow" of Station B in the early days, achieved revenue of 990 million yuan in the third quarter, a decrease of 33% compared with the same period in 2022.
Bilibili said in the financial report that this is mainly due to the high base of "Time Hunter 3" launched in June 2022, and the lower than expected turnover of several new games in the third quarter of 2023.
The game was the "hero" that helped Station B successfully land in the capital market. In 2016, a "Fate/Grand Order" (hereinafter referred to as "FGO") ignited the game business of Station B. In 2017, among the nearly 2.5 billion yuan of revenue of Station B, the revenue of game business contributed more than eighty percent.
However, with the listing process, relying solely on game profitability has also made Station B questioned by the outside world, and Station B has also begun to intentionally reduce the proportion of game revenue, and the proportion of game revenue has dropped from about 70% in 2018 to nearly 20% today. After "FGO", it is difficult for the game of station B to become a hit.
A year ago, Bilibili adjusted the reporting line of the game business team, and Chen Rui personally took over the team, but even so, Bilibili Games still has a long way to go if it wants to return to glory. According to a report by "Southern Metropolis Daily" in October this year, the Guangzhou game development studio "Xinyuan Interactive", a subsidiary of Station B, reported layoffs and dissolution.
Image source: Screenshot of the official website of Bilibili game
On the earnings call, Chen Rui responded that the game business has cut some projects that do not meet market requirements and cannot make money, and will focus resources on more competitive projects in the future. Bilibili is still the video platform with the highest concentration of young people in China and the richest game content, and it needs to translate the advantages of the game track into reality.
Chen Rui has a deep understanding of the competition and changes in the game market this year. He believes that because the dividends of new game users have faded, the game industry has entered the stage of standard stock competition, and some market competition rules and project standards have changed.
Chen Rui Image source: Photo by reporter Zhang Jian (data map)
"When there is a new user bonus, as long as the quality of the game is good, you can make money, but in the stock stage, even if the quality of the game is good, it may not be useful, you either do your best or do it very differently than others. ”
According to Chen Rui's observation, the performance of most of the new games this year is not as good as expected, because most of these new games were established three years ago, and they are somewhat homogeneous for users, and the difference may be, "My art is 80 points, your art is 85 points, and his art is 87 points, and I have fallen into the involution of some details."
In Chen Rui's view, the changes that have taken place in the industry are not that the game market has become smaller or inactive, the activity of game users is still very high, and the DAU of game videos is also increasing. It's not that users don't want to play new games, but they don't need to play homogeneous games.
"I think there are three criteria for a new game to meet in the new phase: first, long-term operation, second, at least a head, you are either the head of all categories (super head) or the head of the vertical category, and third, you have to be a reasonable cost, because the cost is too high to make money. In the past, it was relatively more to follow the trend of project establishment, or want to make differences with others through involution, such as better art. The old ways don't work anymore. ”
Cover image source: Visual China-VCG111425282859
National Business Daily