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Beep Li Li executives interpret earnings: 4G mobile game has no effect on B station game.

via:博客园     time:2018/5/24 16:35:50     readed:355

On the morning of May 24th, Beijing time, Nasdsaq:BILI released its financial report for the first quarter of fiscal year 2018 as of March 31st. The financial report shows that the total net revenue in the first quarter reached RMB 860 million (approximately US$ 138.4 million), an increase of 105% compared with the same period of last year; the net loss in the first quarter was RMB 57.8 million (approximately 920 yuan). Million US dollars), compared with the net loss of RMB 67.4 million in the same period of last year. This is the first financial report released after the IPO (initial public offering) listing in the United States.

After the publication of the financial report, senior executives including Chairman and CEO Chen Rui, President Xu Yi and CFO Fan Xin attended the subsequent earnings conference call to interpret the main points of the financial report and respond to analysts' questions.

The following are the main contents of this conference call analyst’s question and answer session:

JP Morgan Chase analysts:I have three questions, the first one about corporate user growth strategies. The company's MAU performance in this quarter is very good, then how does the company continue to expand the amount of users in the content side and channel side. The second question is about the income outside the game. The income growth of the quarterly live broadcast, membership and advertising business is very strong. In three to five years, how does management see the company's income composition? The third question concerning "UP Owners" is the support for content creators. The company recently proposed a revenue sharing plan with the UP owner. Can you tell us about the latest developments and the company's support strategy for UP owners this year?

Chen Rui:I will first answer the first and third questions. With regard to user growth, you will find that the growth of your users has been relatively continuous and you have maintained a rapid growth rate. Let me introduce the three main reasons for user growth. The first reason is the content ecology of PUGV (High Quality Video). Our entire content ecosystem is very healthy and it is itself a positive cycle and self-growth model. While continuing to deepen the category of superior products, the rate of expansion of new products has always been very fast. For example, in the past quarter, we have expanded the speed of new categories such as entertainment beyond our original strengths such as ACG content.

Therefore, as the category continues to expand, the number of our content creators continues to grow. The number of videos created by content creators has also continued to increase, and content has become a driving force for us to continue to attract users and is the first engine of our traffic growth. What is important is that we do not need to use money to stimulate this engine, nor do we need to use short-term measures to stimulate it. It is a constant accumulation, and the thicker it accumulates, the greater the potential energy for our growth. This is the first point about our self-growth content ecology.

Secondly, we have always attached great importance to the new content or hot content that young people are concerned about. For example, in the past quarter, we focused on new mobile games and e-sports products and formed our own e-sports club. , which is BLG. For new mobile games, we also dig for hot spots. These new hot topics are very much liked by young users and are the second reason why we are driving user growth.

The third point is that we have been actively expanding our installation channels. We are ahead of the whole industry regardless of long-term retention or short-term retention. We will try our best to open source and expand the installation channels on the basis of stabilizing our users' retention. In this regard, we attach great importance to the input-output ratio of costs, so our investment in the expansion of the overall installation channel is very controllable, and the company’s overall marketing costs are still controlled at about 10% of revenue.

On the third issue, our support for creators, we have always regarded the support of creators as one of the most important tasks. As we all know, based on the creators of PUGV video accounts for most of our video playback, we mainly support creators in three ways.

The first point is that our support for creators is a very robust service. This set of services will continuously provide big data to the content creators, allowing them to analyze whether their content is popular or not. For example, what kind of works a new user likes, as well as the user components of the work, are data that can help the creators constantly optimize and improve their work. For the UP master training, we have a systematic model, as well as communication channels with the creators, these initiatives can accelerate the growth of creators. Our overall emphasis on the creators and system is very good in the domestic platform.

Secondly, we released the creator incentive plan in February this year. This incentive plan is also very helpful to the growth of creators. As we all know, the head creators can already get good income from the community. However, we are more concerned about how many new creators can grow up, and we can't let them grow up to be the star of the head faster. In this way, they can create more and more outstanding works for us.

The creator incentive plan is based on the user's positive feedback on the work, and will give incentives to the creators of excellent works, and this incentive does not mean that the creators first help us to make money, and then give them incentives. , as long as users think they are truly outstanding works, we will give creators incentives. In this case, although some of the creators are not very well-known now, although the number of fans is small, they can continue to be inspired by us and grow quickly. The effect of the creator incentive program should be very obvious. We have seen a very significant increase in the number of creators in the first quarter and the number of submissions. And this momentum should continue because creators are a source of our entire PUGV ecosystem.

The third point is that we will share business benefits with the creators in the future, because I think this is also a very important point. Only creators can make more money on our platform and earn more money, so that they can focus more on their creations and use our platform as a family-like place. In this regard, we have already done a variety of plans, so there will be a very rich way to share revenue from business, not just like other platforms, but simply to benefit from traffic. Regardless of the marketing creativity of the creators or their linkage with our existing income owners, including their activeness in the economic attributes of the fans, we will all have a corresponding business income sharing plan. I personally think that this is for the late UP owners and PUGV. The competitiveness of content ecology will have a good promotion.

Fan Xin:Of the total revenue for 2017, 53% came from online games, 7% came from live broadcasting, and 7% came from advertising. We are very pleased to see the strong growth in mobile game revenue in the first quarter of this year. The embarrassing revenue model has become increasingly diversified, as users are increasingly willing to pay for our high-quality content and services, and the advertising business has great potential. As we said in the financial report. Currently, 11% come from the live broadcast business and 8% come from advertising. We expect that in the next three to five years, 50% of total revenue will come from online games, 30% of revenue will be contributed by the advertising business, and the remaining 20% ​​will come from live broadcasting.

Morgan Stanley analyst Alex & middot; Alex Poon:The first question concerns the MAU growth in the first quarter. If the split of 6 million MAU growth is split, how does the age structure of the users be distributed and the content creators are so distributed? The second question is about the impact of the competitive environment on users' access costs. Recently, 4G games took up a lot of time. How does the management see the impact of 4G games on jealousy? The third problem is that the short video platform is also attracting users through PUGV, and the growth rate of MAU is very fast. How does the management feel that the competitive environment will affect the user acquisition cost and MAU growth?

Chen Rui:With regard to the characteristics of new users in 2018, with the continuous development of the platform, new users are also growing year by year. The average daily new users this year is obviously more than last year. From the perspective of new users this year, there are the following characteristics. First, the proportion of users over the age of 19 is higher than in the past. Second, the newly registered users have clearly sunk into third-tier cities in China. In other words, new users are more from third-tier cities. I think this is a result of a reasonable evolution, because as we continue to expand new users, as the new pop culture spreads from developed to underdeveloped regions, the proportion of new users from third-tier cities will also increase. More and more, this just shows that we have greater growth potential in the future.

From the aspect of interest attributes, new users in 2018 are more interested in attributes than previous users. That is, some of our previous content areas (such as ACG content) are still attractive to users, but users are new to documentary, entertainment, etc. The interest in the content category has improved significantly. I think this is actually a good signal that our users are focusing on core content categories in the past and are becoming more and more interested in content, indicating that the interest in new content is increasing. Last but not least, the proportion of users from the Android platform among new users has increased. This is also positively related to the rules of the release and development of China's mobile phone platform. This is about the characteristics of new users.

Regarding the second question, the 4G game has no effect on us. Before the 4G game, it was popular with "The Glory of the Kings". Before "The Glory of the Kings", the League of Legends became popular. The games we introduce and operate are actually tailored to the characteristics of the users in our community. Therefore, we actually use more games based on our own user base. That is to say, external game popularity does not have any impact on our own user experience and activity. We will certainly continue to The preferences and needs are the next stage of the game layout, so we are completely planned in this area and we can also grasp the preferences of our users.

Therefore, the 4G game has no impact on us. From the data point of view, neither the activity of the game users nor the user's use of time and game revenue has been affected by the so-called these popular trends. Our game business has been growing healthily. Let me add that, in fact, some phenomenon-level popular games in the outside world are a great boost to our video and live broadcasting. Everyone knows that in our PUGV content category, games are our second largest category; in the category of live broadcast services In the game, it is the first major category. Once the outside world produces this phenomenon-level popular game, it will stimulate the growth of our game business indicators. In fact, we still very much hope that the phenomenon-level games can happen in the outside world. This is a good thing for our entire content ecology.

I would like to answer the third question again. The short video platform that has emerged in the past six months also has no impact on our business. According to the data of the past quarter, both the number of active users, the amount of video viewing and community interaction, and the duration of use are all in a very steady growth. The reason is very simple, because our model does not follow our own team to follow some content or follow some form of content expression. Instead, content creators pay attention to themselves. No one knows user preferences better than content creators, and Our community's fan relations can better grasp users and content creators and bring them together better. This is a self-growth model. Creators know what users like and they also know what topics users like.

So, we have been following the trend of the most popular content, not relying on the judgment of an elite team, but this model is particularly close to the user's preferences, it can make our platform keep pace with the times, with All the trends. We have been established for nine years. During this nine-year development process, we have experienced a variety of big waves and small waves. We have maintained a very steady growth for the past nine years, so short videos have no effect on us. Nothing can be seen either from the data or from our own model.

Bank of America Merrill Lynch analyst Eddie Leung (Eddie Leung):I have two questions, the first one about anime content. Recently, we have heard that some Internet companies, whether short- or long-time video platforms and large Internet companies, have publicly announced that they must increase their investment in animation. How can you deal with this situation? The second question about game revenue is that it has performed well on proprietary games. What is the net income trend in joint venture games?

Chen Rui: The content platform in the industry has always attached great importance to animation. Several of China's most wealthy companies and several of the largest video platforms, such as Tencent Video, iQIYI, and Youku, have always attached great importance to animation. So, I don't think that the so-called new players added or the animation of several big companies will have an impact on the overall market structure or awkward lead. We are more and more optimistic about this industry, and the prospects for this industry are getting better and better. I think this is actually a good thing.

Some rumors actually refer to the purchase of anime copyright by some platforms. I think so. The reason why I have such a strong advantage in animation is not because we invest the most in copyright. This is actually only one of them. The reason, I think the more important reason is that a large number of animation enthusiasts in China have fallen in love with our platform and have long gathered on this platform because animation-related creators, animation-related opinion leaders, and China’s most passionate animators Fans, they are all active on the embarrassing platform, the entire anime enthusiasts groups and communities are gathered on top of each other.

In addition, Yao first had such a community ecology, and then he invested in copyright, and then made such an investment. Essentially speaking, we are an anime enthusiast community. We have a very strong advantage in community management. This is the most irreplaceable alternative to other platforms. If we look at anime lovers, Your feelings and love will find that you can change our competitive advantage without spending money on your fans.

Fan Xin:The gaming business performed well in the first quarter. Game revenue accounted for 11% of the company's total net revenue.

Credit Suisse analyst Thomas & middot; Thomas Chong:I have two questions. First, can management share its overseas strategies in the coming years? The second question is how many advertisers are there in the first quarter.

Chen Rui:In the long run, we will value the expansion of overseas markets. As we all know, what we do is a pan-entertainment and all communities related to the interests of young people, so we think that the company will easily expand to the world in the future. All corners, especially those emerging countries.

However, in the short term, for example, within the next year, our focus must be on mainland China, because mainland China is the largest single content market in the world, and its growth rate is certainly the fastest in the world in the past one or two years. Since the company itself has been working hard in this field for so many years, it has achieved such a strong competitive advantage. Therefore, we will certainly focus on the investment in this field and let our business operations in mainland China continue to be a competitive one. This is certainly the case in the short term. From a long-term perspective, we will certainly attach great importance to the expansion of overseas markets.

Fan Xin:Our current number of advertisers is not much, because we are just beginning to realize the video stream.

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