[investment points]
In the face of macro environmental challenges, the company's business lines are under pressure. In the fourth quarter of 2022, the company achieved operating revenue of 6.14 billion, an increase of 6.3% over the same period last year. Of these, revenue from mobile games was 1.15 billion, down 11.5% from the same period last year, due to the lack of new mobile games online; revenue from live broadcast and value-added services was 2.35 billion, up 24.0% from the same period last year, with paying users reaching 28.1 million, with a payment rate of 8.6%; advertising revenue was 1.51 billion, down 4.7% from the same period last year, and the macro-economy and epidemic situation affected advertisers' willingness to put Revenue from e-commerce and other businesses was 1.13 billion, up 13.1% from a year earlier. The company expects to achieve revenue of 24-26 billion in 2023, an increase of 9.6-18.7% over the same period last year, and each business line gradually bottomed out.
The gross profit margin increased month-on-month, and the rate of management and R & D expenses increased temporarily. In the fourth quarter of 2022, the company's gross profit margin was 20.3%, up 1.3pct from a year earlier. In the cost ratio, revenue accounts for 41% of the cost, content cost 17%, broadband cost 7%, and other costs 15%. The operating expense rate was 58.2%, an increase of 4.6pct over the same period last year, including 20.6% for sales, 13.3% for management, and 24.3% for R & D. the increase in management expenses was mainly due to organizational optimization expenditure, and the proportion of R & D investment increased significantly, mainly due to the termination of some self-developed games. The net profit of the company is-1.49 billion, the adjusted net profit is-1.31 billion, and the adjusted loss ratio is narrowed.
Affected by seasonality, the number of monthly active users decreased slightly. In the fourth quarter of 2022, the company's MAU reached 326 million, down 7 million in one quarter, DAU reached 93 million, and increased by 2.5 million in a single quarter. The summer is the peak growth season, and the fourth quarter shows some decline. In the fourth quarter, the number of monthly active users of the platform exceeded 3.8 million, with an average monthly contribution of 17.6 million. The number of content creators with more than 10,000 fans increased by 51% compared with the same period last year, with an average of 3.9 billion views per day, and the community has a good ecology.
[investment advice]
We believe that Bilibili Inc. 's good content ecosystem is not only a powerful moat, but also a sharp weapon to break the circle, and the diversification of video content further feeds user growth. Combined with the current operating situation of the company, all business lines have bottomed out and rebounded. We estimate that the company's operating income from 2023 to 2025 will be 265.9 billion; net profit will be 34.2 million; diluted EPS will be-14.0, 8.7; and PS will be 2.0, 1.7 and 1.5 times, respectively, maintaining the "overweight" rating.
[risk Tip]
Policy regulatory risk
User growth fell short of expectations
Commercial growth is not as good as expected.