Kaiyuan Securities has released a research report stating that, considering BILIBILI-W's (09626) plans to increase investment in artificial intelligence, the firm has revised its forecasts for attributable net profit for 2026-2027 downward and introduced a new forecast for 2028. The new projections are 1.574 billion yuan, 2.486 billion yuan, and 3.307 billion yuan respectively (compared to prior values of 2.086 billion yuan and 2.850 billion yuan). The current stock price corresponds to a price-to-earnings (P/E) ratio of 46.7x, 29.5x, and 22.2x for those years. The report expresses optimism regarding AI's long-term potential to empower the platform and maintains a "Buy" rating. The main points from Kaiyuan Securities are as follows:
Performance in the fourth quarter continued to show strong growth, with advertising growth accelerating further. The report anticipates an acceleration in commercialization. In Q4 2025, the company achieved revenue of 8.321 billion yuan (a year-on-year increase of 8%, quarter-on-quarter increase of 8%), and an attributable net profit of 513 million yuan (a year-on-year surge of 471%, quarter-on-quarter increase of 9%). Adjusted net profit was 878 million yuan (a year-on-year increase of 94%, quarter-on-quarter increase of 12%). Value-added service revenue in Q4 2025 was 3.262 billion yuan (up 6% year-on-year, up 8% quarter-on-quarter), primarily driven by increased revenue from services like "Charging" and premium memberships. Advertising revenue reached 3.042 billion yuan (a significant year-on-year increase of 27%, quarter-on-quarter increase of 18%), mainly due to improvements in advertising product supply and efficiency. Mobile game revenue was 1.540 billion yuan (a year-on-year decrease of 14%, but a quarter-on-quarter increase of 2%), largely attributed to a high base in 2024 following the launch of "Three Kingdoms: Strategy for the World". IP-derived product and other revenue amounted to 477 million yuan (a year-on-year increase of 3%). The gross profit margin improved for the 14th consecutive quarter, reaching 37.0% in Q4 (up 0.9 percentage points year-on-year, up 0.4 percentage points quarter-on-quarter). The combined sales, management, and research and development expense ratio was 31.0%, indicating the emergence of operational leverage effects.
Long-term operation strategies are creating evergreen games, while a rich pipeline of new games provides strong momentum for future growth. The company adheres to a long-term operational approach. Its core game, "Three Kingdoms: Strategy for the World," launched a new season scenario on February 28th, propelling it to the 4th position on the mainland iOS game bestseller chart. The company is actively expanding overseas; the same game was launched in the Hong Kong, Macau, and Taiwan markets in January, with plans to gradually expand into other Asian markets like Japan and South Korea. The game pipeline is robust. A console/mobile version of the popular PC single-player game "Escape from Yakovo" is under development. "Three Kingdoms: Hundred Generals Card," a game with high daily active user (DAU) potential, has completed two rounds of testing and plans to start paid testing in March for a mid-2026 launch. The casual pet-collecting game "Shine! Lumi" has already obtained a publication license, with plans for paid testing in Q2 2026 and a global release within 2026.
The community ecosystem continues to develop in a healthy manner, and the report is optimistic that comprehensive AI empowerment will further unlock the platform's commercialization potential. The company competes through differentiated, high-quality content. Daily active users showed accelerated year-on-year growth for the full year (Q4 DAU was 113 million, up 10% year-on-year). Monthly active users in Q4 reached 366 million (an 8% year-on-year increase). The average daily usage time in Q4 was 107 minutes (an increase of 8 minutes year-on-year). The total watch time for videos longer than 45 minutes in Q4 grew by over 20% year-on-year, and total user time spent on the platform in 2025 increased by 14% year-on-year. The creator ecosystem is healthy; the average monthly video uploads in 2025 increased by 15% year-on-year, and the average revenue per UP主 (content creator) grew by 21% year-on-year. AI is accelerating platform growth. AI-generated content (AIGC) tools are lowering the barriers to creation for creators and the barriers to ad placement for advertisers. Large language models (LLMs) are improving the precision of content distribution and advertising targeting. Advertising spending related to AI increased by over 150% year-on-year in 2025. The report is positive on AI's potential to reshape content creation, user experience, and monetization methods, thereby expanding the platform's commercialization opportunities.
Risk warnings include the possibility that game lifecycles or revenue may fall short of expectations, and that advertising revenue growth may not meet forecasts.
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