Bilibili Shares Gain in Hong Kong as New Gaming App Gets Thumbs Up

By Tracy Qu

Bilibili's Hong Kong-listed shares mirrored overnight gains in the U.S. as investors anticipate a potential new earnings driver following better-than-expected reception to its latest mobile game.

The stock rose as much as 4.3% in Hong Kong on Friday morning, and was last 1.9% higher at 119.00 Hong Kong dollars (US$15.24). Overnight, Bilibili's American depository receipts on the Nasdaq closed 7.7% higher at US$15.50.

The Shanghai-based videogame and social-media company on Thursday launched simulation game "San Guo: Mou Ding Tian Xia," whose app ranked third in Apple's iOS game downloads on the first day of the launch, according to data provider Sensortower.

"Should San Guo maintain its high ranking on the grossing chart, it could prompt analysts to revise Bilibili's revenue and earnings forecasts upward," said Morningstar analyst Ivan Su. However, he recommends waiting a few more days before drawing any conclusions, as game popularity could fluctuate rapidly.

Bilibili has been posting annual losses since it went public in 2018, and aims to break even at the operating level in the third quarter. In the first quarter, the company's revenue rose 12% from a year earlier to 5.66 billion yuan (US$780.4 million). Its first-quarter adjusted operating loss narrowed significantly to CNY512.23 million.

Jefferies analysts Thomas Chong and Zoey Zong said Bilibili's new game response was a "positive surprise" and expect the game's first-month grossing to exceed market expectations.

Write to Tracy Qu at tracy.qu@wsj.com

(END) Dow Jones Newswires

June 14, 2024 01:13 ET (05:13 GMT)

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