Video streamer Bilibili sees losses more than double on increased competition and tighter regulation
- Bilibili’s losses have ballooned amid tighter scrutiny by Beijing of content deemed unhealthy and fierce competition from the likes of Douyin
- The Shanghai-based company has to rely on an army of content reviewers to check uploaded videos to see if they adhere with strict rules
Losses at China’s video-streaming website Bilibili, which has seen its stock price fall 70 per cent since a Hong Kong listing last March, more than doubled in 2021 to 6.8 billion yuan (US$1.07 billion) from the year before, amid rising competition and tighter regulation.
In the fourth quarter of 2021 alone, its net loss amounted to 2.1 billion yuan, according to financial results released by the company on Thursday.
The heavy losses at Bilibili, once touted as the leading online community for China’s Generation Z, highlights the risks of a business model under fire from short video apps such as Douyin, the Chinese version of TikTok owned by ByteDance, and a ruthless regulatory crackdown by Beijing on any content deemed unhealthy.
Bilibili’s losses have ballooned amid tighter scrutiny by Beijing of imported anime, which has eroded the platform’s early appeal as an online home for subculture groups. Meanwhile, rigid control of video gaming, including a seven-month freeze on new game licences, has also hurt growth in gaming revenue momentum.
Bilibili vows to hire more staff after death of employee
The Shanghai-based company has to rely on an army of content reviewers to check uploaded videos to see whether content is in line with state regulations – an increasingly costly enterprise given ever-changing rules.
One of its content reviewers, a 25-year-old employee, died last month, although the company denied the sudden death was related to overwork.
The company has said it will hire another 1,000 content reviewers, or in-house content police, to spread the bigger workload across a greater number of people.
Chen Rui, chairman and chief executive officer of Bilibili, said in a conference call on Thursday that the company would focus on “healthy” and “high-quality” growth in 2022. It will also try to improve efficiency and narrow losses.
“We’ll pay more attention to controlling our expenses, reduce our costs and improve our overall efficiency, putting every dollar we spent to greater use,” said Chen.
Bilibili bans live-streaming of Grand Theft Auto and The Witcher 3
Meanwhile, chief financial officer Sam Fan said on the same call that the company may reach break-even point in 2024.
The company’s revenue in the last quarter of 2021 rose 51 per cent to 5.78 billion yuan, with gaming up 15 per cent while advertising revenue surged 120 per cent.
Its monthly active user base reached 271.7 million at the end of 2021, an increase of 35 per cent from a year ago, the company said.
The company said total annual revenue rose 62 per cent to 19.4 billion yuan year-on-year. The company said it would buy back up to US$500 million of advanced depositary receipts in the US over the next 24 months.
