BILI: Games Recovery Will Test Sustainability Amid Fairly Balanced Risk Profile

Analysts have nudged their fair value estimate for Bilibili higher from approximately $22.18 to $22.82, citing a recovery in gaming revenues and an improving games up cycle that supports slightly faster growth and margins, despite a still demanding valuation.

Analyst Commentary

Recent Street research on Bilibili reflects a mixed but cautious stance, with rising price targets tempered by concerns around valuation and the durability of the current games led recovery. While the near term outlook for gaming revenue has improved, analysts remain wary about how much of this upside is already reflected in the share price.

Bearish analysts highlight that even with the recent rally driven by new title launches, the stock continues to trade on metrics that assume sustained high growth and margin expansion, leaving limited room for execution missteps or cyclical setbacks in user engagement and monetization.

Some commentary also points to the risk that the current games up cycle, including contributions from titles such as Escape From Duckov, could be front loaded. This would increase the risk of a slowdown once the initial launch momentum fades, especially if follow on releases underperform expectations.

At the same time, there is an acknowledgment that advertising and value added services still need to pull more weight in the growth algorithm. Any disappointment on non gaming revenue ramps could refocus the market on structural profitability challenges.

Bearish Takeaways

• Bearish analysts caution that the stock valuation remains demanding even after the latest price target increases. This implies that the current share price already bakes in optimistic assumptions for sustained games revenue growth and margin expansion.
• There is concern that the recent share price strength, helped by better than expected sales from new game launches, may prove fragile if subsequent titles fail to match early performance or if user spending normalizes faster than anticipated.
• Execution risk around expanding the games pipeline and converting temporary launch spikes into recurring, high quality revenue is seen as elevated. This raises the possibility of earnings volatility and negative revisions if billings momentum slows.
• Some bearish views emphasize that, despite operational improvements, Bilibili still faces long term uncertainties in balancing content investment, user growth, and profitability. This leaves downside risk if growth decelerates while costs remain sticky.

What's in the News

• Board meeting scheduled for November 13, 2025, to approve unaudited financial results for the third quarter ended September 30, 2025, with a Q3 results announcement expected following the meeting (Key Developments).
• Share repurchase update shows no shares bought between July 1 and September 30, 2025, while confirming completion of the previously announced buyback program totaling 6,400,000 shares, or 1.54 percent of outstanding shares, for $116.4 million under the November 14, 2024, authorization (Key Developments).

Valuation Changes

• Fair Value Estimate has risen slightly from $22.18 to $22.82 per share, reflecting a modest uplift in intrinsic value assumptions.
• Discount Rate has increased marginally from 8.99 percent to 9.29 percent, indicating a slightly higher required return and risk premium.
• Revenue Growth has been revised up from 7.08 percent to 7.68 percent annually, pointing to a modestly stronger top line outlook.
• Net Profit Margin has inched higher from 8.49 percent to 8.77 percent, incorporating a small improvement in long term profitability expectations.
• Future P/E multiple has edged up from 26.3x to 27.0x, implying a slightly richer valuation on forward earnings.