Bilibili : Quarterly Earnings Documents

2023 INTERIM REPORT

Bilibili Inc. HKEX: 9626 NASDAQ: BILI

(A company controlled through weighted voting rights and incorporated in the Cayman Islands with limited liability)

Bilibili Inc. 2023 Interim Report

Contents

Company Information	2
Financial Highlights	3
Business Review and Outlook	6
Management Discussion and Analysis	11
Corporate Governance	16
Other Information	21
Report on Review of Interim Financial Information	31
Unaudited Interim Condensed Consolidated Balance Sheet	33
Unaudited Interim Condensed Consolidated Statement of Operations and Comprehensive Loss	36
Unaudited Interim Condensed Consolidated Statement of Changes in Shareholders' Equity	38
Unaudited Interim Condensed Consolidated Statement of Cash Flows	40
Notes to Unaudited Interim Condensed Consolidated Financial Information	43
Definitions	77

Bilibili Inc. 2023 Interim Report

Company Information

BOARD OF DIRECTORS

Directors

Mr. Rui Chen (Chairman and Chief Executive Officer) Ms. Ni Li

Mr. Yi Xu

Independent Directors

Mr. JP Gan

Mr. Eric He

Mr. Feng Li

Mr. Guoqi Ding

AUDIT COMMITTEE

Mr. Eric He (Chairman)

Mr. JP Gan

Mr. Feng Li

COMPENSATION COMMITTEE

Mr. JP Gan (Chairman)

Mr. Eric He

Mr. Feng Li

NOMINATING AND CORPORATE GOVERNANCE COMMITTEE

Mr. JP Gan (Chairman)

Mr. Eric He

Mr. Feng Li

JOINT COMPANY SECRETARIES

Mr. Xin Fan

Ms. Chau Hing Ling Anita (FCG, HKFCG)

AUTHORIZED REPRESENTATIVES

Mr. Yi Xu

Mr. Xin Fan

Ms. Chau Hing Ling Anita

PRINCIPAL EXECUTIVE OFFICES OF MAIN OPERATIONS

Building 3, Guozheng Center

No. 485 Zhengli Road

Yangpu District

Shanghai

People's Republic of China

ADDRESS IN HONG KONG

Suite 603, 6/F, Laws Commercial Plaza 788 Cheung Sha Wan Road Kowloon

Hong Kong

REGISTERED OFFICE

Walkers Corporate Limited

190 Elgin Avenue

George Town

Grand Cayman KY1-9008

Cayman Islands

CAYMAN ISLANDS PRINCIPAL SHARE REGISTRAR

Walkers Corporate Limited

190 Elgin Avenue

George Town

Grand Cayman KY1-9008

Cayman Islands

HONG KONG SHARE REGISTRAR

Computershare Hong Kong Investor Services Limited

Shops 1712-1716, 17th Floor

Hopewell Centre

183 Queen's Road East

Wanchai

Hong Kong

COMPLIANCE ADVISER

Somerley Capital Limited

20th Floor, China Building

29 Queen's Road Central

Hong Kong

PRINCIPAL BANK

China Merchants Bank Shanghai Branch

STOCK CODE

HKEX: 9626

NASDAQ: BILI

AUDITOR

PricewaterhouseCoopers

Certified Public Accountants and Registered Public

• Interest Entity Auditor 22/F, Prince's Building Central
  Hong Kong

COMPANY WEBSITE

https://ir.bilibili.com/

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Bilibili Inc. 2023 Interim Report

Financial Highlights

For the Six Months Ended June 30,

		2022	2023	Change (%)
		RMB	RMB
		(in thousands, except for percentages)
	Net revenues	9,963,030	10,373,810	4.1%
	Gross profit	1,545,526	2,331,466	50.9%
	Loss before income tax	(4,237,976)	(2,122,187)	(49.9%)
	Net loss	(4,294,577)	(2,177,777)	(49.3%)
Net loss attributable to the Bilibili Inc.'s shareholders	(4,288,909)	(2,174,393)	(49.3%)
Non-GAAP Financial Measures:
	Adjusted net loss	(3,622,848)	(1,994,852)	(44.9%)
Adjusted net loss attributable to the Bilibili Inc.'s
	shareholders	(3,617,180)	(1,991,468)	(44.9%)
		As of	As of
		2022	2023
		December 31	June 30	Change (%)
		RMB	RMB
		(in thousands, except for percentages)
Total current assets	24,452,888	18,710,694	(23.5%)
Total non-current assets	17,377,682	16,184,663	(6.9%)
Total assets	41,830,570	34,895,357	(16.6%)
Total liabilities	26,590,983	18,362,675	(30.9%)
Total shareholders' equity	15,239,587	16,532,682	8.5%
Total liabilities and shareholders' equity	41,830,570	34,895,357	(16.6%)

Non-GAAP Financial Measures

The Company uses non-GAAP measures, such as adjusted net loss and adjusted net loss attributable to the Bilibili Inc.'s Shareholders, in evaluating its operating results and for financial and operational decision-making purposes. The Company believes that the non-GAAP financial measures help identify underlying trends in its business by excluding the impact of share-based compensation expenses, amortization expense related to intangible assets acquired through business acquisitions, income tax related to intangible assets acquired through business acquisitions, loss/gain on fair value change in investments in publicly traded companies, gain on repurchase of convertible senior notes, expenses related to organizational optimization, and termination expenses of certain game projects. The Company believes that the non-GAAP financial measures provide useful information about the Company's results of operations, enhance the overall understanding of the Company's past performance and future prospects and allow for greater visibility with respect to key metrics used by the Company's management in its financial and operational decision-making.

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Bilibili Inc. 2023 Interim Report

Financial Highlights

The non-GAAP financial measures are not defined under U.S. GAAP and are not presented in accordance with U.S. GAAP and therefore may not be comparable to similar measures presented by other companies. The non-GAAP financial measures have limitations as analytical tools, and when assessing the Company's operating performance, cash flows or liquidity, investors should not consider them in isolation, or as a substitute for net loss, cash flows provided by operating activities or other consolidated statements of operations and cash flows data prepared in accordance with U.S. GAAP.

The Company mitigates these limitations by reconciling the non-GAAP financial measures to the most comparable U.S. GAAP performance measures, all of which should be considered when evaluating the Company's performance.

The following table sets forth unaudited reconciliation of GAAP and non-GAAP results for the periods indicated.

		For the Six Months Ended June 30,
		2022	2023
		RMB	RMB
		(in thousands)
Net loss	(4,294,577)	(2,177,777)
Add:
	Share-based compensation expenses	534,560	561,548
Amortization expense related to intangible assets acquired
	through business acquisitions	96,335	96,302
Income tax related to intangible assets acquired
	through business acquisitions	(18,009)	(11,250)
Loss/(gain) on fair value change in investments in publicly
	traded companies	335,929	(181,233)
	Gain on repurchase of convertible senior notes	(475,790)	(282,442)
Expenses related to organizational optimization	89,650	-
Termination expenses of certain game projects	109,054	-
Adjusted net loss	(3,622,848)	(1,994,852)

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