Bilibili (BILI) PT Lowered to $38 at Citi

Citi analyst Brian Gong lowered the price target on Bilibili (NASDAQ: BILI) to $38.00 (from $45.00) while maintaining a Buy rating.

The analyst comments "Bili reported 2Q22 results with rev in line but non-GAAP loss 13% wider than Citi/consensus. 3Q22 rev is guided at Rmb5.6-5.8bn, which midpoint is 5/4% below Citi/consensus. Average MAU was +29% yoy to 305.7mn. Into 2H22, mgmt sees challenges from macro softness toward ads business but momentum on live streaming remains strong due to continuous growth on paying users, while we think gaming could improve sequentially with some new games to be launched domestically and overseas. However, VAS and ecommerce could still see some disruption from COVID. Bili will continue to optimize cost and expects GPM/non-GAAP NPM to improve by 5/10% in 4Q22 vs. 2Q22. We lower 2022/23/24E rev estimates by 4/8/9% to reflect macro softness and COVID impact and cut TP to US$38 from US$45. Despite top-line headwinds, we maintain Buy given the company’s healthy ecosystem and commitment to narrow loss."

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