Chinese video platform Bilibili is restructuring its business units to boost profit growth, Chinese media outlet LatePost reported on Monday.
Why it matters: Despite strong growth in users and content offerings, Bilibili has been facing more pressure to turn a profit since it went public in New York in 2018. The extensive restructuring is aimed at helping the company become profitable by 2024, a goal first revealed by the company CEO Chen Rui at the fourth quarter earnings call in 2021.
Details: The overhaul mainly affects three core business units: commercialization, streaming, and content-related business. Six executives have either assumed new roles or left the company. In addition, Bilibili has also set up a new data center.
- Bilibiliโs commercialization unit will have a new leader Liu Zhi, who previously worked in the unit before joining Bilibiliโs operations unit. He helped expand the user base of the main site. Liu will directly report to Bilibiliโs CEO Chen Rui. The unitโs previous leader Liu Binxin will leave the company.ย
- Head of Bilibiliโs streaming sector Wang Yuyang will also take over the operations sector. Wang is a young executive and former founder of the notable Chinese esports agency Dae Culture (our translation).
- LatePost cited a source at the company as saying that some previous experimental reforms โ such as the combining of its video and streaming businesses โ had been positive, and Bilibili is now looking to implement such reforms in other parts of the company.
- The restructuring will also see Bilibiliโs animation business become a new independent unit, separate from the site operations unit where it previously belonged. The new unit and the firmโs entertainment, film, and TV series business will now belong to the Occupationally Generated Video (OGV) department.ย
- Bilibili is also establishing a new data center. Zhang Zecong will lead and report to the firmโs COO and vice chairman Li Ni.
Context: Bilibili has continued to maintain user growth but is still a long way from turning a profit. In the first quarter, Bilibili had a 25% yearly growth in subscribers, while its net loss has widened 152% from last year to RMB 2.3 billion ($340 million). The firm is prioritizing commercialization as a critical task for this year, said its first-quarter earnings report.ย
- The firmโs streaming business has 60% more paid users in the first quarter than in the same period last year. Active streamers also saw an 88% growth in the first quarter from last year.
- Bilibiliโs gaming revenue grew 16% year-on-year during the same period to reach RMB 1.4 billion.
- The video streaming platform introduced โStory Modeโ in 2021. The new feature displays short vertical videos for mobile users and aims to increase commercial performance and user engagement. The feature contributed 20% of its total video plays in the first quarter, according to the firmโs earnings call. In April, the company launched commercial services on the new feature.
