On May 19, Bilibili Inc. (BILIBILI-W) released its unaudited financial results for the first quarter of 2026. The company's revenue surpassed market expectations, and it achieved a turnaround from a net loss to a net profit compared to the same period last year.
The financial report shows that the company's total net revenue for the first quarter reached RMB 7.47 billion, a 7% increase year-on-year, slightly exceeding the Bloomberg consensus estimate of RMB 7.46 billion. Net profit was RMB 202 million, a significant improvement from a net loss of RMB 11 million in the same period last year, successfully turning profitable. Adjusted earnings per share were RMB 1.31, outperforming both the RMB 0.85 from the same period last year and the market expectation of RMB 1.15.
Simultaneously, profitability quality continued to improve. The gross margin for the quarter reached 37.1%, marking the 15th consecutive quarter of improvement, showing steady growth from 36.3% in the same period last year. Adjusted net profit was RMB 585 million, a 62% increase year-on-year, with the adjusted net profit margin rising from 5.2% to 7.8% compared to the same period last year.
User activity and engagement also saw growth. Daily active users (DAU) in the first quarter reached 115.2 million, an 8% increase year-on-year; monthly active users (MAU) reached 376 million, a 2.2% increase year-on-year. Average daily user time spent approached two hours (119 minutes), an increase of 11 minutes year-on-year, while total user time spent grew by 19% year-on-year, indicating sustained enhancement in community vitality and user participation. CEO Rui Chen attributed these results to the adherence to the principles of "high-quality content" and "community first," emphasizing that AI is accelerating the platform's flywheel across all stages from content creation and distribution to commercial efficiency.
Advertising revenue showed strong growth, while the gaming business was impacted by a high base effect. Bilibili's first-quarter advertising revenue was RMB 2.59 billion, a 30% increase year-on-year, becoming the primary driver of net revenue growth. The company stated that the growth was mainly due to improvements in advertising product offerings and enhanced advertising effectiveness. Meanwhile, value-added service revenue, including premium membership, was RMB 2.91 billion, a 4% increase year-on-year, primarily driven by growth in premium membership and other value-added services.
In contrast, mobile game revenue was RMB 1.52 billion, a 12% decrease year-on-year. The company explained that this was mainly due to a high base effect from the previous year, when the game "Three Kingdoms: Strategy for World Domination" performed exceptionally well, and the game is now transitioning to a stable, mature lifecycle. Additionally, IP derivative and other revenue was RMB 448 million, a slight 4% decrease year-on-year.
Profitability and operational efficiency continued to improve, with the gross margin rising for the 15th consecutive quarter. Bilibili's first-quarter net profit was RMB 202 million, achieving a turnaround from a net loss of RMB 11 million in the same period last year. The net profit margin reached 2.7%, an improvement of 2.9 percentage points year-on-year. Adjusted net profit was RMB 585 million, a 62% increase year-on-year, with the adjusted net profit margin improving from 5.2% to 7.8% compared to the same period last year.
This profit improvement was supported by effective cost and expense management: operating costs grew by 5% year-on-year, lower than the revenue growth rate. Total operating expenses increased by 3% year-on-year, significantly lower than the gross profit growth rate, indicating the continued effect of operating leverage. Specifically, sales and marketing expenses decreased by 1% year-on-year, while research and development expenses increased by 9% year-on-year, primarily due to expanded AI investments, partially offset by expenditure controls.
The Chief Financial Officer, Xin Fan, stated that the gross margin has improved for the 15th consecutive quarter and that the company will continue to advance AI-related investments prudently, with their positive effects gradually being reflected in community metrics and financial performance.
AI accelerates the flywheel effect, with community activity and user time reaching new highs. This quarter, Bilibili emphasized the accelerating role of AI in its flywheel effect. The company noted that AI is enhancing efficiency across all stages, from content creation and distribution to commercial efficiency, with monetization gradually becoming a natural extension of community ecosystem development.
Driven by both AI empowerment and high-quality content, community vitality continued to strengthen. In the first quarter, Bilibili's DAU reached 115 million, an 8% increase year-on-year; MAU surpassed 376 million. Average daily user time spent approached two hours (119 minutes), an increase of 11 minutes year-on-year, while total user time spent grew by 19% year-on-year.
Management indicated, "We are confident in transforming this momentum into long-term, sustainable growth and value accumulation." Moving forward, the company will continue to prudently advance AI-related investments while maintaining profitability, expecting these investments to contribute to long-term value over the coming years.
