What happened

Shares of Bilibili (NASDAQ:BILI) were surging on Thursday, rising 14.2% as of 3:30 p.m. EST. The China-based social media network that's built around sharing and commenting on short-form videos has emerged as an important channel for news and entertainment as large portions of China are paralyzed by the coronavirus.

So what

Many Chinese stocks have taken a beating amid the virus outbreak, but Bilibili and similar online news sources are swimming against the stream.

Chinese authorities are locking down Wuhan, where the virus was first reported, asking its residents to stay in the city in order to contain the spread of the disease. Social media platforms such as Bilibili make it easy to share what's going on inside quarantined areas, and some media-streaming services are making special efforts to serve populations behind locked doors. For example, Bilibili partnered up with the popular Strawberry Music Festival to share the festival's music videos for free.

Close-up shot of two hands using a smartphone where the screen shows the word News in large block letters.

Image source: Getty Images.

Now what

When Bilibili reports fourth-quarter earnings near the end of February, we'll probably see the company's surging traffic related to coronavirus news and entertainment content. Eyeballs are eyeballs, and Bilibili is not pausing its advertising efforts during this newsworthy crisis. Not in the fourth-quarter release itself, of course, since Bilibili closed the books on that period at the end of December. Keep an eye on the company's first-quarter guidance figures instead.

So Bilibili's big jump today actually makes sense. Next up, the company probably wants to convert the windfall of new users seeking coronavirus information into paying long-term customers.