Bilibili (BILI) Q1 2023 Earnings Call Transcript

For the period ending March 31, 2023

June 1, 2023 8:00 a.m. ET

Prepared Remarks

Questions and Answers

Call Participants

Prepared Remarks:

Operator

Good day, and welcome to the Bilibili First Quarter 2023 Financial Results and Business Update Conference Call. Today's conference is being recorded.

At this time, I would like to turn the conference over to Juliet Yang, Executive Director of Investor Relations. Please go ahead.

Juliet Yang

Thank you, operator.

During this call, we'll discuss our business outlook and make forward-looking statements. These comments are based on our predictions and expectations as of today. Actual events or results could differ materially from those mentioned in today's news release and in this discussion due to a number of risks and uncertainties, including those mentioned in our most recent filing with the SEC and Hong Kong Stock Exchange.

The non-GAAP financial measures we provide are for comparison purpose only. Definitions of these measures and a reconciliation table are available in the news release we issued earlier today.

As a reminder, this conference call is being recorded. In addition, an investor presentation and a webcast replay of this conference call will be available on the Bilibili IR website at ir.bilibili.com.

Joining us today from Bilibili senior management are Mr. Rui Chen, Chairman of the Board and Chief Executive Officer; Ms. Carly Li, Vice Chairwoman of the Board and Chief Operating Officer; and Mr. Sam Fan, Chief Financial Officer.

And I will now turn the call over to Mr. Fan, who will read the prepared remarks on behalf of Mr. Chen.

Rui Chen

[Interpreted] Thank you, Juliet. And thank you everyone for participating in our 2023 first quarter conference call. I'm pleased to deliver today's opening remarks on behalf of Mr. Chen.

Our top priority for 2023 is to improve our commercialization efficiency and narrow our losses. Our first quarter results demonstrate that we are making solid progress on these goals.

First, we delivered over 20% year-on-year revenue growth from our advertising business. Our gross margin improved to 22% in the first quarter, up from 16% a year ago, driving gross profit to increase by 37% year-over-year.

Second, we continue to take measures to strengthen the execution of our expense controls. As a result, we reduced total operating expenses in the first quarter by 11% year-over-year. Specifically, we cut our sales and marketing expenses by 30% year-over-year while continuing to expand our DAUs. These actions are proving effective in strengthening our bottom-line. In the first quarter, we narrowed our net loss by 72% year-over-year. The progress we have made gives us confidence that we are on the right track to achieve our break-even target.