Bilibili(BILI 1.75%) reported results for its fiscal second quarter ended June 30, 2025, on August 28, 2025. Gross margin expanded to 36.5%, up from 29.9% in the same period last year, operating profit reached RMB 252 million, and monthly paying users climbed 9% year over year to 31 million, highlighting strengthening monetization and improved operational leverage.

Advertising margin expands as BILI surpasses industry growth

The company’s advertising business achieved a record RMB 2.4 billion in revenue and outpaced broader industry growth, propelled by upgrades to ad infrastructure, smart placement, and Large Language Model (LLM) enhancements. Performance-based advertising revenue grew approximately 30% year over year, with effective cost per mille (eCPM) up over 10% year over year, while the number of unique advertisers rose more than 20% year over year.

"In the second quarter, our advertising business maintained strong growth, outpacing the overall industry. Quarterly revenue reached a record high of RMB 2.4 billion, up 20% year over year. Speaking of the driver behind that growth, we continue to focus on the one horizontal and vertical strategy. In this quarter, we continued to strengthen our ad infrastructure product, and technology efficiency allowed us to further unleash our users' value and traffic value."
-- Rui Chen, Chairman and CEO

Advertising revenues increased 20% year over year, with performance-based advertising revenue growing around 30% and eCPM up over 10%. This demonstrates the company’s ability to leverage technology and data to drive above-industry growth in a competitive digital advertising landscape.

Bilibili games revenue outperforms with sustainable new titles

Game revenues surged 60% year over year to RMB 1.6 billion as titles like Samo broke user and monetization records, further supported by evergreen franchises FGO and Azerlane. New monetization features such as limited edition skins were successfully piloted during major in-game events. The launch of a traditional Chinese version is expected at the end of this year or early next year, with overseas expansion also being explored.

"On June 13, Samo celebrated its first anniversary, and during that season, the DAU broke a new record within the year of 2025. The achievement of Samo on its first anniversary truly demonstrates that the game has established itself and laid a foundation to become a long-lasting title. We are confident that Samo will become a lifestyle with a life cycle of over five years and continue to contribute solid game revenue for us. During the season eight and anniversary celebration event, we have launched multiple new monetization tools such as the limited edition skins, which were well received by our users. We believe, for example, the skin sales during the anniversary have met our expectations and show that we have explored a new monetization tool that is even more healthy and sustainable compared to other tools."
-- Rui Chen, Chairman and CEO

This combination of recurring engagement from existing franchises and successful experimentation with monetization models is contributing to resilient, high-margin growth, positioning the company for further expansion in both domestic and international gaming markets.

Operational leverage drives sustained profit and margin expansion

Gross profit grew 46% year over year to RMB 2.7 billion, while group operating profit turned positive to RMB 252 million, with adjusted operating margin reaching 7.8%. Total operating expenses were stable year over year at RMB 2.4 billion, reflecting disciplined cost management and efficiency improvements.

"So we saw very strong operating leverage here. Our gross margin has been increased sequentially for 12 quarters. We expect the same trend to continue in the 37% by Q4, let's say. So we still maintain our midterm gross profit margin target of 40% to 45%. And for the OpEx, we have continued to improve our efficiency of the operation. So if you look at the absolute dollar amount of our OpEx in the first half of this year, it's pretty flat year over year."
-- Sam Fan, CFO

The company’s ability to translate vigorous topline growth into improving operating and net profit margins reflects a scalable, asset-light business model and creates greater headroom for future reinvestment and shareholder return initiatives.

Looking Ahead

The company is targeting a 10% adjusted operating margin in the fourth quarter of 2025 and a medium-term range of 15% to 20%. Cash flows remain robust, with RMB 22.3 billion (USD 3.1 billion) in liquidity as of June 30, 2025, and ongoing execution of a USD 200 million buyback program, with USD 84 million remaining as of June 30, 2025. The company plans to expand AI-powered tools for content creation and ad delivery, pursue regional and international game launches, and further improve operational efficiency; no explicit full-year revenue or user metric guidance was disclosed on this call.