1.Bilibili's accidental crash
Bilibili has been discussed a lot on Weibo($WB) recently. On July 13, Bilibili's server went down, causing a narrow down on its gain by 3%. Bilibili's share price has risen with the assistance of its widely-discussed accidental crash. As of the close of the market on July 14, Bilibili($BILI) rose 3.18%, with a market value of $42.4 billion. On July 14, Bilibili (HKG:09626) opened low. As of the intraday, it went down slightly by 0.69% to HK$854 per share. Bilibili is attractive to its users for sure, but it lacks more attention from the market.
2.Is Bilibili the Chinese version of YouTube?
Both YouTube and Bilibili are video-sharing websites based on UGC. Both platforms have gathered many high-quality content creators, with a high degree of user participation and cohesion.
Bilibili is a cultural community that gathers the younger generation of Chinese people, dominated by "millennials" and "post-millennials", while YouTube is for all ages. At the level of commercial cash flow, the division between Bilibili and YouTube is more obvious. The underlying logic of YouTube is to liquidate and build a closed-loop business model through advertising and subscription. However, Bilibili does not use the exact business model of the former. The most obvious difference is that Bilibili does not have in-video advertisements.
Bilibili shows more commercialization possibilities in the process of expanding businesses using its own model and gradually jumps out of the discussion of "who would be the next YouTube".
3. Why does Bilibili return to Hong Kong for listing?
Generally speaking, the reason why companies return to Hongkong after listing in the US is generally due to the fact that their stock price is undervalued. But Bilibili is different. Bilibili has always been the "favorite" of Wall Street since its listing. Despite continuous losses, the stock price has been rising for three consecutive years, with a cumulative increase of more than 800%.
Why should such a company go back to Hong Kong for the second listing? For Bilibili which is well-known for ACG, it can develop the platform in a quicker and healthier way depending on its capital and influence, so as to win the new competition. In the market offered 2018, a listing is the best way for Bilibili to gain priority at that time. Back to listing in Hong Kong to attract a wider range of investors, which has also laid a more solid foundation for Bilibili to implement its long-term growth strategy. Fueled by the booming of online video platforms, Bilibili will eventually dominate the long-videos market.
4. With large losses, what supports Bilibili's high valuation?
During the reporting period, Bilibili explained its continuous losses by stating that it has been in a high-growth phase and strategically invested in user growth by investing in brands and quality content to prepare for long-term profitability. Clearly, in Bilibili's opinion, at the moment, having more users would be better than short-term net profit growth to support its valuation. Thanks to the trend of users growth and the number of profits that are still increasing, the capital market is optimistic about the prospects of Bilibili. Analyzing Bilibili's financial reports, it is clear that Bilibili maintains cash and cash equivalent reserves of $3.5 billion to $5 billion per year from 2018 to 2020. Abundant cash reserves ensure Bilibili's long-term investment in the development of technology and the quality of content.
5. Does Bilibili have big development prospects?
According to iResearch, China's gaming industry is expected to exceed RMB500 billion by 2025. With the rapid development of this industry, Bilibili strengthens its own research and operation ability and establishes close cooperation with major domestic game IPs, developers, and publishers. Recently, Bilibili strategically invested in cardiac networks and mobile games, strengthening the layout of the game industry chain in the future.
To promote more users engagements and diverse community's topics, Bilibili tries to invite a large number of UPers (same as YouTubers) with creative ability, propagandize bullet screen culture (which means real-time comments from viewers to fly across the screen like bullets), and run a community which is based on the youth's preference. These improvements decided Bilibili could be the winner of the video platform. However, there is still some stuff that Bilibili needs to be changed and improved, like how to solve the quality of the content problem, how to keep active users, and how to avoid copyright problems of the long video. At this point, Bilibili still faces an uncertain future. That is to say, always considering users' profits and preferences to become a valued video platform is the most important thing for Bilibili to think about and this factor could help Bilibili's further development.
