Will Bilibili’s New Algorithm and Equity Grants Reframe Its Long‑Term Engagement Strategy (BILI)?

• Bilibili recently removed its long-running “Guess You Like” homepage recommendation system and began rolling out a new content-matching algorithm, while also issuing a small number of Class Z shares in March 2026 through employee equity plans.
• This combination of a core product algorithm overhaul and ongoing equity-based compensation sheds light on how Bilibili balances user experience evolution with talent retention.
• Next, we’ll assess how replacing the “Guess You Like” recommendation engine could influence Bilibili’s investment narrative around engagement and monetization.

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Bilibili Investment Narrative Recap

To own Bilibili, you need to believe its Gen Z focused entertainment platform can turn strong engagement into durable profits while managing content, competition, and regulatory pressures. The near term catalyst remains how effectively it monetizes record user activity and improves margins, while the biggest risk is that rising content and creator costs outpace ARPU gains. The recommendation algorithm overhaul and modest equity dilution look incremental rather than thesis changing in the short run.

The most relevant recent announcement is Bilibili’s 2025 full year earnings, where it moved from a net loss to net income of CNY 1,193.53 million on revenue of CNY 30,347.77 million. Against that backdrop, the shift away from “Guess You Like” toward a new recommendation system feeds directly into the engagement and ad monetization story that supported this profitability milestone and will likely be a focal point for how investors judge the next phase of growth.

But while these changes may appear routine, investors should also be aware of...

Read the full narrative on Bilibili (it's free!)

Bilibili's narrative projects CN¥38.4 billion revenue and CN¥3.4 billion earnings by 2028. This requires 9.3% yearly revenue growth and about CN¥3.2 billion earnings increase from CN¥220.3 million today.

Uncover how Bilibili's forecasts yield a $31.14 fair value, a 36% upside to its current price.

Exploring Other Perspectives

Before this news, the most optimistic analysts were counting on revenue near CNY 39.9 billion and earnings of about CNY 5.5 billion by 2028, so you should expect that views on Bilibili’s AI and content risks could shift meaningfully as this recommendation overhaul and ongoing content spending evolve.

Explore 4 other fair value estimates on Bilibili - why the stock might be worth over 2x more than the current price!

Reach Your Own Conclusion

Disagree with existing narratives? Extraordinary investment returns rarely come from following the herd, so go with your instincts.

• A great starting point for your Bilibili research is our analysis highlighting 4 key rewards that could impact your investment decision.
• Our free Bilibili research report provides a comprehensive fundamental analysis summarized in a single visual - the Snowflake - making it easy to evaluate Bilibili's overall financial health at a glance.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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