Chinese streaming company Bilibili releases rap video with quarterly results

People visit the video platform Bilibilly Stand during the 2020 China Digital Entertainment Expo & Conference (Chinajoy) at the Shanghai New International Expo Center on July 31, 2020 in Shanghai, China.

Zhou You | Visual china group | Getty Images

BEIJING – One of the most popular video and gaming apps among China’s youth, Bilibili on Thursday decided to portray its quarterly earnings report in an unconventional way with the release of a rap music video.

The Nasdaq-listed company is one of the fastest growing apps in China. Following the earnings report, shares of Bilibili rose more than 6% in extended trading on Thursday.

Resembles a plush white TV cartoon “head” in the style of American DJ Marshmello – the lead performer introduces a futuristic, beat of a Mandarin rap about the space station’s capsule, reflecting the achievements of Bilibili.

The video references a strategic partnership with BBC Studios and also features in-house content with an English tagline – “Produced by Bilibili.”

One scene features the lead actor as the anchor of a television news broadcast.

Headlines roll to the bottom of the screen with the following caption:

  • As per (quarterly) third quarter earnings, our MAU (Average Monthly Active Users) has grown by 54%.
  • In August, our MAUs exceeded 200 million, marking a new monthly record.
  • Average daily video views reached a record high of 1.3 billion in Q3.
  • The average daily time was up to 81 minutes.

At the end the video wraps in just over two minutes, with the main cast having four dancers.

The closing caption reads: “All videos of your interest at Billy Station,” according to the CNBC translation of the Chinese text, which uses a colloquial term for Bilibili’s stage.

US-listed shares of Bilibili climbed

The Tencent-supported video streaming platform has gained popularity this year in an industry crowded with players such as TikTok, Douyin, the Chinese version of iQiyi and ByteDance.

Analysts have stated that the innovative content is part of the reason that Bilibili attracts younger audiences. This summer, the company’s “Rap for Youth” reality TV show received a 9.2 in 10-star rating by 62,900 reviewers on the culture-centric Chinese social media platform, Duban.

Conversely, rival iQiyi’s “Wrap of China” aired around the same time, until Dublin received a 4.5 rating from over 14,400 critics – lower than the previous season, with a 5.3 rating from 34,000 reviewers. Was found.

As of Thursday afternoon, Bilibili’s quarterly earnings video received nearly 11,000 views on the company’s primary app, about five hours after its release.

The company produces more than a third of its revenue from mobile games. According to a release, total net revenue increased 74% year-over-year to 3.23 billion yuan (about $ 490 million) in the third quarter. The company expects net revenue of 3.6 billion yuan in the fourth quarter to 3.7 billion yuan, an increase of at least 79% from the year-ago period.

Tencent-related entities held 13.3% of the company, while Alibaba subsidiary Taobao China held 7.2%, according to Bilibili’s 2019 annual report.

Challenge for demonetization

Turning user growth into revenue is still a challenge for video streaming companies. Many people in China are still not used to paying for content, while companies often need to invest heavily in creating interesting content to attract and retain users.

In the three months ending on September 30, both Bilibili and IQII reported net losses for shareholders of over one billion yuan.

Bilibili said average monthly paying users increased 89% in the third quarter to 15 million from a year earlier, down from 8% of monthly active users of 197.2 million.

IQiyi – the much larger video streaming platform owned by Baidu – said earlier this week that subscribers fell slightly to 104.8 million on September 30 from 105.8 million a year earlier. Total revenue fell 3% to 7.2 billion yuan.

IQiyi said it would focus more on the monetization of big-screen-related businesses, which the total users recently spent on TV has surpassed on mobile devices. The company did not provide details of the time spent or the time the milestone was exceeded.

After climbing more than 40% last year, the Nasdaq-listed iQiyi has gained nearly 7% for the year so far.

In contrast, Bilibili’s shares are up more than 150% year-to-date. The market capitalization of both companies is approximately $ 16.6 billion.

Meanwhile, Bilibili is looking to raise more capital. Amidst US-China tensions, the Chinese company is preparing for a secondary listing in Hong Kong that could raise up to $ 1.5 billion, a person familiar with the matter told CNBC in October. The listing is likely next year.

– Arjun Kharpal of CNBC contributed to this report.

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