China chip stocks rally on self-reliance bets, Nvidia scrutiny
Investing.com - Barclays (LON:BARC) raised its price target on Bilibili (NASDAQ:BILI) to $28.00 from $25.00 on Friday, while maintaining an Overweight rating on the stock. The company’s stock has shown impressive momentum, delivering a 31.2% return year-to-date, according to InvestingPro data.
The firm cited Bilibili’s continued success in unlocking advertising value and expanding margins as key factors behind the adjustment. Barclays noted that Bilibili’s advertising segment grew 20% year-over-year in Q2, maintaining a growth rate of 20% or higher each quarter since early 2023. InvestingPro analysis shows the company’s overall revenue growth at 22.7% in the last twelve months, with analysts expecting continued profitability this year.
Bilibili achieved record gross margin of 36.5% and record non-GAAP operating margin of 7.8% in the second quarter. Management has guided margins to continue trending higher in the second half of 2023, projecting 37% gross margin and 10% operating margin by Q4. The company maintains strong financial health with a "GOOD" overall score from InvestingPro, which offers 10+ additional exclusive insights about Bilibili’s performance and outlook.
Barclays highlighted that a driver behind the gross margin expansion is the mix shift toward higher-margin advertising business. The firm also acknowledged Bilibili’s "excellent job" in managing operating expenses over recent years.
Management has guided second-half operating expenses to decrease year-over-year, while reiterating medium-term targets of 40-45% gross margin and 15-20% operating margin.
In other recent news, Bilibili Inc . reported its second-quarter results for 2025, delivering strong performance metrics. The company posted earnings per share of $1.29, surpassing analysts’ expectations of $1.20. Revenue also slightly exceeded projections, coming in at $7.34 billion compared to the anticipated $7.33 billion. Despite these positive results, Jefferies adjusted its price target for Bilibili from $29.00 to $28.00, though it maintained a Buy rating. This adjustment followed the company’s earnings announcement, where non-GAAP operating profit exceeded forecasts due to lower-than-expected sales and marketing expenses. These developments highlight Bilibili’s ability to manage costs effectively while achieving revenue targets. However, broader market volatility has influenced investor sentiment, leading to concerns about future growth prospects.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.