Bilibili Inc (BILI) 2023 Q2 法說會逐字稿

Good day, and welcome to Bilibili Second Quarter 2023 Financial Results and Business Update Conference Call. Today's conference is being recorded. At this time, I would like to turn the conference over to Juliet Yang, Executive Director of Investor Relations. Please go ahead.

美好的一天，歡迎參加 Bilibili 2023 年第二季度財務業績和業務更新電話會議。今天的會議正在錄製中。現在，我想把會議交給投資者關係執行董事朱麗葉·楊（Juliet Yang）。請繼續。

Thank you, operator. During this call, we'll discuss business outlook and make forward-looking statements. These comments are based on our predictions and expectations as of today. Actual events or results could differ materially from those mentioned in today's news release and in this discussion due to a number of risks and uncertainties, including those mentioned in our most recent filing with the SEC and Hong Kong Stock Exchange.

謝謝你，接線員。在本次電話會議中，我們將討論業務前景並做出前瞻性陳述。這些評論基於我們今天的預測和期望。由於存在許多風險和不確定性，包括我們最近向美國證券交易委員會和香港證券交易所提交的文件中提到的風險和不確定性，實際事件或結果可能與今天的新聞稿和本次討論中提到的存在重大差異。

The non-GAAP financial measures we provide are for comparison purpose only. Definition of these measures and a reconciliation table are available in the news release we issued earlier today.

我們提供的非公認會計準則財務指標僅供比較之用。這些措施的定義和調節表可在我們今天早些時候發布的新聞稿中找到。

As a reminder, this conference is being recorded. In addition, an investor presentation and a webcast replay of this conference call will be available on the Bilibili IR website at ir.bilibili.com.

提醒一下，本次會議正在錄製中。此外，投資者介紹和本次電話會議的網絡直播重播將在 Bilibili IR 網站 ir.bilibili.com 上提供。

Joining us today from Bilibili senior management are Mr. Rui Chen, Chairman of the Board and Chief Executive Officer; Ms. Carly Li, Vice Chairwoman of the Board and Chief Operating Officer; and Mr. Sam Fan, Chief Financial Officer. And I will now turn the call over to Mr. Fan who will read the prepared remarks on behalf of Mr. Chen.

今天加入我們的還有 Bilibili 董事會主席兼首席執行官陳銳先生；李嘉莉女士，董事會副主席兼首席運營官；范先生，首席財務官。我現在將電話轉交給范先生，他將代表陳先生宣讀準備好的發言稿。

Thank you, Juliet, and thank you, everyone for participating in our 2023 second quarter conference call to discuss our financial and operating results. I'm pleased to deliver today's opening remarks on behalf of Mr. Chen.

謝謝朱麗葉，謝謝大家參加我們的 2023 年第二季度電話會議，討論我們的財務和運營業績。我很高興代表陳先生致今天的開幕詞。

We set our sights on prioritizing profitability and DAU growth, and we have made solid steps towards these goals. In the second quarter, we meaningfully improved our gross profit and narrowed our losses while continuing to deliver healthy DAU growth and strong community metrics. I will share more color on both fronts.

我們的目標是優先考慮盈利能力和 DAU 增長，並且我們已經朝著這些目標邁出了堅實的步伐。第二季度，我們顯著提高了毛利潤並縮小了虧損，同時繼續實現健康的 DAU 增長和強勁的社區指標。我將在這兩個方面分享更多的色彩。

First of all, our path to profitability. In the second quarter, we further improved our commercialization efficiency, enabling us to convert our growing traffic to quality top-line growth. The momentum we see in our advertising and live broadcasting business is encouraging. In the second quarter, our ad revenues increased by 36% and live broadcasting revenues increased by 32% both year-over-year. Moreover, our gross profit increased significantly by 66% year-over-year, driving our gross profit margin to 23%, marking the fourth consecutive quarter of improvement.

首先，我們的盈利之路。第二季度，我們進一步提高了商業化效率，使我們能夠將不斷增長的流量轉化為優質的營收增長。我們在廣告和直播業務中看到的勢頭令人鼓舞。第二季度，我們的廣告收入同比增長36%，直播收入同比增長32%。此外，我們的毛利潤同比大幅增長66%，推動毛利率達到23%，連續第四個季度改善。

Meanwhile, we have continued to strengthen our expense controls. Our total operating expenses declined by 14%, including a 22% decrease in sales and marketing expenses, a 14% decrease in G&A expenses and a 7% decrease in R&D expenses or on a year-over-year basis. These margin enhancements and our effective cost management contributed to our bottom line improvement. We meaningfully reduced our non-GAAP net loss by 51% year-over-year.

同時，我們繼續加強費用控制。我們的總運營費用同比下降了 14%，其中銷售和營銷費用下降了 22%，一般管理費用下降了 14%，研發費用下降了 7%。這些利潤率的提高和我們有效的成本管理有助於我們的利潤改善。我們的非 GAAP 淨虧損同比大幅減少了 51%。

Moving on to our community growth. Our DAUs increased by 15% year-over-year to 96.5 million in the second quarter, driving our DAU-to-MAU ratio up to 29.8%. Meanwhile, the users' average daily time spent on our platform reached 94 minutes in the second quarter, driving total time spent up by 22% year-on-year. We are pleased to see this strong DAU growth has continued in Q3.

繼續我們的社區發展。第二季度我們的 DAU 同比增長 15% 至 9650 萬，推動我們的 DAU 與 MAU 比率達到 29.8%。與此同時，第二季度用戶日均在我們平台上的時長達到94分鐘，帶動總時長同比增長22%。我們很高興看到第三季度 DAU 持續強勁增長。

As we move into the second half of this year, our main tasks will be in three core areas. First, we aim to further enhance our traffic commercialization efficiency by increasing our ad revenues and the live broadcasting revenues. Additionally, we will bring more high-quality games to our users, including the highly anticipated game, Pretty Derby.

進入下半年，我們的主要任務將集中在三個核心領域。首先，我們的目標是通過增加廣告收入和直播收入來進一步提高流量商業化效率。此外，我們還將為用戶帶來更多優質遊戲，包括備受期待的《Pretty Derby》遊戲。

Secondly, we will continue to take a prudent financial approach with strict control of our cost and expenses and further narrow our losses. Finally, yet importantly, we are committed to achieving ongoing DAU growth and fostering an inspiring video community for young generations in China.

其次，我們將繼續堅持穩健的財務方針，嚴格控製成本費用，進一步縮小損失。最後但也很重要的是，我們致力於實現日活躍用戶的持續增長，並為中國的年輕一代培育一個鼓舞人心的視頻社區。

With that overview of our progress, I'd now like to provide a brief update on our three core pillars of content, community and commercialization. Starting with content. Content creators continue to be our ecosystem's most valuable asset. Supporting these talented content creators and their ability to amass large followings and to be able to earn more money are among our top tasks. As always, we continue to optimize our algorithms and products to facilitate high-quality content and enable creators to be recognized.

在概述了我們的進展之後，我現在想簡要介紹一下我們的三個核心支柱：內容、社區和商業化。從內容開始。內容創作者仍然是我們生態系統最有價值的資產。支持這些才華橫溢的內容創作者以及他們積累大量粉絲並賺取更多收入的能力是我們的首要任務之一。一如既往，我們不斷優化我們的算法和產品，以促進高質量的內容並使創作者得到認可。

In the second quarter, the number of daily active content creators on our platform and our monthly content submissions increased by 19% and 43% year-over-year, respectively. In the second half of this year, we plan to shift our video watching metric from video views to video time spent, which will help our users discover more high-quality content on Bilibili. We are also beta testing an AI-powered search feature in our community that enables relevant videos to be found more easily.

第二季度，我們平台上的每日活躍內容創作者數量和每月內容提交量分別同比增長 19% 和 43%。今年下半年，我們計劃將視頻觀看指標從視頻觀看次數轉變為視頻時長，這將有助於我們的用戶在嗶哩嗶哩上發現更多優質內容。我們還在社區中測試了人工智能驅動的搜索功能，使相關視頻能夠更輕鬆地找到。

Creator monetization on Bilibili increased as well in the second quarter. Over 1.58 million creators earn money through various Bilibili channels, showing a 40% increase year-over-year. In addition to our cash incentive program, more creators are earning income through advertising and the live broadcasting channels. For example, our video commerce apps have opened up new efficient, earning opportunities for content creators.

第二季度 Bilibili 上的創作者變現也有所增加。超過158萬創作者通過嗶哩嗶哩各種渠道賺錢，同比增長40%。除了我們的現金激勵計劃之外，更多的創作者還通過廣告和直播渠道獲得收入。例如，我們的視頻商務應用程序為內容創作者開闢了新的高效賺錢機會。

In the second quarter, the number of creators who earned money through video commerce grew by over 220% year-over-year. Resonant content and multi-scenario products like Story Mode continue to drive platform traction.

第二季度，通過視頻商務賺錢的創作者數量同比增長超過220%。引起共鳴的內容和故事模式等多場景產品繼續推動平台的發展。

In the second quarter, our total daily video views were up 31% year-over-year to 4.1 billion, among which, Story Mode daily video views grew by 76% year-over-year. It has become one of the key video consumption scenarios for our users, contributing to our growth in DAUs and ad revenues.

第二季度，我們的日視頻總觀看次數同比增長 31% 至 41 億，其中故事模式日視頻觀看次數同比增長 76%。它已成為我們用戶的主要視頻消費場景之一，為我們的日活躍用戶和廣告收入的增長做出了貢獻。

Turning to our community. Our users remain highly engaged and sticky. The user's average daily time spent on our platform was 94 minutes in the second quarter, reaching the highest second quarter level in our company's history. The monthly interactions reached nearly 15 billion in the second quarter, up 19% year-over-year.

轉向我們的社區。我們的用戶仍然保持高度參與度和粘性。第二季度用戶日均在我們平台上花費的時間為94分鐘，達到我們公司歷史上第二季度的最高水平。第二季度月互動量近150億，同比增長19%。

Our core group of official members also increased by 26% year-over-year to 214 million with a solid 12-month retention rate of around 80%. Our signature offline events also bring our community together in person. This July, we hosted 2 exciting offline events, BilibiliWorld and Bilibili Macro Link in Shanghai. Over 200,000 tickets sold out almost immediately. The tremendous response highlights Bilibili's strong influence among young generations as well as users' willingness to pay for our unique community experiences.

我們的核心官方會員群體也同比增長 26%，達到 2.14 億，12 個月的留存率穩定在 80% 左右。我們的標誌性線下活動也將我們的社區面對面地聚集在一起。今年7月，我們在上海舉辦了兩場激動人心的線下活動：BilibiliWorld和Bilibili Macro Link。超過 200,000 張門票幾乎立即售空。如此巨大的反響凸顯了嗶哩嗶哩在年輕一代中的強大影響力，以及用戶為我們獨特的社區體驗付費的意願。

Finally, let's look at our commercialization and financial progress. Total revenues for the second quarter increased by 8% year-over-year to RMB 5.3 billion. Specifically, revenue from our advertising and live broadcasting businesses increased by 36% and 32% year-over-year, respectively. Meanwhile, we continue to improve our gross profit and margin. Our gross profit in the second quarter grew by a notable 66% year-over-year, driving our gross profit margin up to 23% from 15% in the same period last year.

最後，讓我們看看我們的商業化和財務進展。第二季度總收入同比增長8%至人民幣53億元。其中，廣告和直播業務收入同比分別增長36%和32%。與此同時，我們繼續提高毛利率和利潤率。第二季度毛利潤同比大幅增長66%，毛利率從去年同期的15%上升至23%。

Looking at this in more detail. Revenues from our value-added services business grew 9% year-over-year to RMB 2.3 billion in the second quarter, primarily driven by increased revenues from our live broadcasting business, which grew by 32% year-over-year. As we further integrate live broadcasting within our video operations, we have opened up multiple opportunities to expand and diversify our live broadcasting content by converting content creators into live broadcasting hosts.

更詳細地看看這個。第二季度，我們的增值服務業務收入同比增長9%至人民幣23億元，主要得益於直播業務收入的增長，同比增長32%。隨著我們進一步將直播融入視頻業務，我們通過將內容創作者轉變為直播主播，為我們的直播內容的擴展和多元化開闢了多種機會。

In the second quarter the number of monthly active live broadcasting hosts increased by 15% year-over-year. In addition, we are exploring new live broadcasting products to create more paying channels for our users, including live celebration events. We expect our ongoing integration activities to support our revenue growth in the second half of 2023.

第二季度月活躍直播主播數量同比增長15%。此外，我們正在探索新的直播產品，為用戶創造更多付費渠道，包括現場慶祝活動。我們預計正在進行的整合活動將支持我們 2023 年下半年的收入增長。

By the end of June, we had 20.5 million premium members, over 80% of whom are on an annual subscription or auto-renew package, highlighting our trust-based user relationships.

截至 6 月底，我們擁有 2050 萬高級會員，其中超過 80% 的會員採用年度訂閱或自動續訂套餐，這凸顯了我們基於信任的用戶關係。

In Q3, we released several highly anticipated Chinese anime titles, including Fog Hill of the Five Elements, (foreign language), and our self-produced title Link Click Season 2, (foreign language), to bring more exclusive high-quality content to our premium members.

第三季度，我們發布了多部備受期待的中國動漫作品，包括《五行霧山》（外文）、以及我們自製的作品《連連看第二季》（外文），為大家帶來更多獨家優質內容。我們的高級會員。

Turning to our advertising business. As we progress our initiative to integrate sales conversion with ad products, we believe we have found an effective way convert our high-quality traffic to advertising revenue growth. For the second quarter, our advertising revenues grew 36% year-over-year to RMB 1.6 billion, mainly led by our performance-based ad revenues growth, which increased by over 60% year-over-year, and revenues from our brand and Sparkle offerings also grew by a double-digit percentage year-over-year.

轉向我們的廣告業務。隨著我們將銷售轉化與廣告產品相結合的舉措不斷推進，我們相信我們已經找到了一種將優質流量轉化為廣告收入增長的有效方法。第二季度，我們的廣告收入同比增長 36% 至 16 億元人民幣，主要得益於效果類廣告收入增長（同比增長超過 60%）以及品牌和廣告收入。 Sparkle 產品也同比增長了兩位數。

Our top 5 advertising verticals in the second quarter were: games, e-commerce, digital products and home appliances, skin care and cosmetics, and food and beverage.

第二季度排名前五的廣告垂直行業是：遊戲、電子商務、數碼產品和家電、護膚和化妝品、食品和飲料。

Our continuous improvements to our integrated industry ad solutions have also helped us gain more ad budget spend from industries such as games and e-commerce. Specifically, by introducing video commerce products, ad revenues from the e-commerce industry increased by 144% year-over-year in the second quarter. Meanwhile, content creators were able to benefit from more ad opportunities. The number of creators who earn income through video commerce grew over 220% year-over-year.

我們對綜合行業廣告解決方案的不斷改進也幫助我們從遊戲、電商等行業獲得了更多的廣告預算支出。具體來說，通過推出視頻商務產品，第二季度電商行業廣告收入同比增長144%。與此同時，內容創作者能夠從更多的廣告機會中受益。通過視頻商務賺取收入的創作者數量同比增長超過 220%。

Moving forward, we will continue to build our commercial database, refine our algorithms as well as optimize our ad product offerings. We are confident that we can improve our ad revenues per DAU and achieve solid growth in the second half of 2023.

展望未來，我們將繼續建立我們的商業數據庫，完善我們的算法並優化我們的廣告產品。我們有信心能夠提高每 DAU 的廣告收入，並在 2023 年下半年實現穩健增長。

As for our games business, our revenues were RMB 891 million for the second quarter, a 15% decline from the same period last year. The year-on-year decline was mainly due to a lack of new game launches in the second quarter and a growth in decline for certain titles. Our top 2 performing games, Azur Lane and FGO, remained stable. Particularly during Azur Lane's 6-year anniversary, the game reached a new peak in paying users and revenues. In addition, we have also successfully extended our exclusive license of Azur Lane for another 5 years.

遊戲業務方面，第二季度收入為人民幣8.91億元，較去年同期下降15%。同比下降的主要原因是第二季度缺乏新遊戲發布以及某些遊戲的降幅擴大。我們表現​​最好的兩款遊戲《碧藍航線》和《FGO》保持穩定。特別是在《碧藍航線》上市六週年期間，該遊戲的付費用戶和收入達到了新的高峰。此外，我們還成功將《碧藍航線》的獨家授權再延長5年。

In July, we launched our first self-developed game in the female romance genre, Alkaidland Records, (foreign language). Welcomed by a host of female users, the game ranked #1 on the iOS free download chart shortly after its release. We are actively working on developing more games that users love. In the meantime, we have seven new titles that we plan to release in domestic and overseas markets in the second half of the year, including the highly anticipated game, Pretty Derby, (foreign language). Pretty Derby is scheduled to launch on August 30 and is now available for preregistration. Over 2 million players have already preregistered as of today.

7月，我們推出了第一款自主開發的女性愛情遊戲《Alkaidland Records》（外文）。該遊戲在發布後不久就在iOS免費下載排行榜上排名第一，受到了眾多女性用戶的歡迎。我們正在積極致力於開發更多用戶喜愛的遊戲。同時，我們還有七款新遊戲計劃下半年在國內外市場推出，其中包括備受期待的《漂亮德比》（外文）。 Pretty Derby 定於 8 月 30 日推出，現已開放預註冊。截至今日已有超過200萬玩家進行預註冊。

Given said that, the launch of Pretty Derby as well as few self-developed titles were delayed by several months than we initially planned due to lower revenue contribution from games and other non-core businesses such as IP derivatives and others. We now expect the full year 2023 revenue to be between RMB 22.5 billion and RMB 23.5 billion.

吉文表示，由於遊戲和IP衍生品等其他非核心業務的收入貢獻較低，《Pretty Derby》以及少數自研遊戲的推出比我們最初計劃推遲了幾個月。我們目前預計 2023 年全年收入將在 225 億元至 235 億元人民幣之間。

As I mentioned earlier, our key financial goal for this year is to improve our gross profit and narrow losses. We have delivered on this goal with 66% increase in gross profit and a 51% cut on adjusted net loss in the second quarter.

正如我之前提到的，我們今年的主要財務目標是提高毛利、縮小虧損。我們已經實現了這一目標，第二季度毛利潤增長了 66%，調整後淨虧損減少了 51%。

Look ahead, we are committed to further improve our gross profit and control our expenses and meaningfully cut down losses in the second half of this year and reach our breakeven target by 2024.

展望未來，我們致力於在今年下半年進一步提高毛利，控制開支，切實減少虧損，並在2024年實現盈虧平衡目標。

As we progress on achieving our financial targets, we will continue to lead the healthy growth across our platform and enrich the everyday life of young generation in China.

隨著我們不斷實現財務目標，我們將繼續引領整個平台的健康發展，豐富中國年輕一代的日常生活。

This concludes Mr. Chen's remarks. I will now provide a brief overview of our financial results for the second quarter of 2023.

陳先生的發言到此結束。我現在將簡要概述我們 2023 年第二季度的財務業績。

As mentioned in Mr. Chen's remarks, our financials continue to improve. We are improving our margins and showing clear results in our bottom line with narrowed losses. Total net revenues for the second quarter were RMB 5.3 billion, up 8% compared with the same period last year. Our total net revenues breakdown by revenue stream was approximately 43% VAS, 30% advertising, 17% mobile games and the 10% from our IP derivatives and other businesses.

正如陳先生在講話中提到的，我們的財務狀況持續改善。我們正在提高利潤率，並在虧損收窄的情況下顯示出明顯的盈利成果。第二季度淨營收總額為人民幣53億元，較去年同期增長8%。我們的總淨收入按收入來源細分約為 43% 的增值服務、30% 的廣告、17% 的手機遊戲以及 10% 來自我們的 IP 衍生品和其他業務。

Our cost of revenues decreased by 2% year-over-year to RMB 4.1 billion, driving our gross profit to RMB 1.2 billion, up 66% year-over-year. Our gross margin was 23%, up from 15% in the same period last year. We expect gross margin to continue to improve throughout the back half of the year.

收入成本同比下降2%至人民幣41億元，帶動毛利潤達人民幣12億元，同比增長66%。我們的毛利率為 23%，高於去年同期的 15%。我們預計下半年毛利率將繼續改善。

Our total operating expenses were down 14% year-over-year to RMB 2.5 billion. Tight control of our expenses is ongoing while we improve our monetization at the same time. We cut sales and marketing expenses by 22% year-over-year to RMB 918 million, while our DAUs grew by 15%. As a percent of total revenues, sales and marketing was 17% compared with 24% in the same period last year. G&A expenses were RMB 539.7 million, down 14% year-over-year. R&D expenses were RMB 1 billion, down 7% year-over-year.

我們的總運營費用同比下降 14% 至人民幣 25 億元。我們將繼續嚴格控制開支，同時提高貨幣化水平。我們的銷售和營銷費用同比削減 22% 至 9.18 億元人民幣，而 DAU 增長了 15%。銷售和營銷佔總收入的比例為 17%，而去年同期為 24%。一般及行政費用為人民幣 5.397 億元，同比下降 14%。研發費用10億元，同比下降7%。

Our net loss and adjusted net loss were RMB 1.5 billion and RMB 964.1 million, respectively, narrowing by 23% and 51% year-over-year, respectively. Our adjusted net loss ratio in the second quarter was 18%, improving from 40% for the same period a year ago.

我們的淨虧損和調整後淨虧損分別為人民幣15億元和人民幣9.641億元，同比分別收窄23%和51%。第二季度調整後淨虧損率為 18%，較去年同期的 40% 有所改善。

Turning to our capital allocation and liabilities management. In June 2023, we completed the repurchase right offer for our 2027 notes with a total principal amount of USD 746 million. As of the end of the second quarter, our outstanding convertible bonds totaled a principal amount of USD 876 million. As of June 30, 2023, we had cash and cash equivalents, time deposits and short-term investments of RMB 14.3 billion or USD 2 billion. We believe this amount is sufficient to cover all of our remaining convertible bonds and fund our future operations.

轉向我們的資本配置和負債管理。 2023年6月，我們完成了2027年票據的回購權要約，本金總額為7.46億美元。截至第二季度末，我們未償還的可轉換債券本金總額為8.76億美元。截至2023年6月30日，我們的現金及現金等價物、定期存款和短期投資為143億元人民幣（20億美元）。我們相信這筆金額足以支付我們所有剩餘的可轉換債券並為我們未來的運營提供資金。

Thank you for your attention. We would now like to open the call to your questions. Operator, please go ahead.

感謝您的關注。我們現在想開始回答您的問題。接線員，請繼續。

(Operator Instructions) And the first question, Xueqing Zhang from CICC.

（操作員說明） 第一個問題，來自中金公司的張學清。

(foreign language) Congrats on advertising towards profitability. My question is about user engagement. Do you further increase in the second quarter, so the DAU trend going forward? And can management share more details on the user engagement during the recent summer holidays?

（外語）恭喜廣告盈利。我的問題是關於用戶參與度。第二季度的 DAU 趨勢是否會進一步增加？管理層能否分享有關最近暑假期間用戶參與度的更多詳細信息？

(foreign language)

（外語）

[Interpreted] Last year, I have been emphasizing increasing our earnings power and achieve healthy and sustainable DAU growth are the top 2 priorities of our company, and we have been executing on that strategy.

【解讀】去年我一直強調，提高盈利能力、實現健康可持續的DAU增長是我們公司的兩大首要任務，我們也一直在執行這個戰略。

In the second quarter, with sales and marketing down 22% year-on-year, we have grown our DAU by 15%, reaching 96.5 million and our daily time spent -- daily user time spent reached 96 -- 94 minutes. This is the record high of same period in our operating history. And our overall time spent of the entire community grew by 22% year-over-year, all of above metrics shows a very healthy and robust growth of the community.

第二季度，在銷售和營銷同比下降 22% 的情況下，我們的 DAU 增長了 15%，達到 9650 萬，我們的每日花費時間——每日用戶花費的時間達到 96 - 94 分鐘。這是我們經營歷史上同期的歷史新高。我們整個社區的總花費時間同比增長了 22%，所有上述指標都表明社區的增長非常健康和強勁。

The reason why we have been emphasizing on the healthy growth of our DAU is because we believe the healthy growth of DAU is the foundation and preliminary requirement for Bilibili to achieve sustainable profit. And we believe we have already discovered an effective way to convert our high-quality traffic into increasing top line through advertising and live broadcasting. And we believe with this effective route and methods, we can achieve DAU and top-line growth, and this will be a virtuous cycle.

我們之所以一直強調DAU的健康增長，是因為我們認為DAU的健康增長是嗶哩嗶哩實現可持續盈利的基礎和初步要求。我們相信，我們已經找到了一種有效的方法，可以通過廣告和直播將我們的優質流量轉化為增加的收入。我們相信通過這種有效的路線和方法，我們能夠實現DAU和營收的增長，這將是一個良性循環。

In the second quarter, our ad revenue and live broadcasting revenue achieved 36% and 32% year-on-year growth, respectively, which exceeded the industry average growth a lot.

第二季度，我們的廣告收入和直播收入分別實現了36%和32%的同比增長，大大超過行業平均增長。

As for the outlook into the summer, given that we're in August in a period of the summer vacation, we have been witnessing and experiencing a strong DAU and daily user time spent growth. We do expect that in the third quarter, our DAU can surpass a very exciting milestone of 100 million. And we also expect our average daily time spent can reach a new historical high.

至於夏季的展望，鑑於我們正處於 8 月份的暑假期間，我們見證並經歷了 DAU 和每日用戶花費時間的強勁增長。我們確實預計，在第三季度，我們的 DAU 可以突破 1 億這一令人興奮的里程碑。我們還預計我們的平均每日花費時間可以達到新的歷史高點。

We are very confident with tight control on sales and marketing expense. We can continue to attract our users with high-quality content and return our user with our engaging community and achieve DAU sustainable and healthy growth. And we also believe this high traffic can be effectively converted to our sustainable top line-growth.

我們對嚴格控制銷售和營銷費用非常有信心。我們可以持續以優質內容吸引用戶，以優質社區回報用戶，實現DAU持續健康增長。我們還相信，這種高流量可以有效地轉化為我們可持續的收入增長。

And the next question from Lei Zhang from Bank of America Securities.

下一個問題是來自美國銀行證券的張磊。

(foreign language) Congrats on the solid advertising growth. My question also relate to ad business. Can you share with us the major driver on also ad business, follow the strong base of second quarter? Also, can you give us some updates on the June 18 promotion ad growth on our platform? In addition, how should we look at the second half ad growth on Bilibili? And how should we think about the new business, e-commerce streaming development to our ad business?

（外語）祝賀廣告業務的穩健增長。我的問題也與廣告業務有關。您能否與我們分享一下廣告業務的主要驅動力以及第二季度的強勁基礎？另外，您能否向我們介紹一下我們平台上 6 月 18 日促銷廣告增長的最新情況？另外，我們應該如何看待下半年嗶哩嗶哩的廣告增長？我們應該如何看待新業務——電商流媒體的發展對我們廣告業務的影響？

(foreign language)

（外語）

[Interpreted] In the second quarter, our ad revenue grew by 36% year-on-year. And overall, for the first half of this year, our ad growth rate has exceeded the industry average. At the same time, if you look at the ad revenue per -- ad revenue as percentage of total revenue, it has increased from 25% same period last year to 30% in the second quarter, which directly leads to growth of our gross profit.

【解讀】第二季度，我們的廣告收入同比增長36%。總體而言，今年上半年，我們的廣告增長率已經超過了行業平均水平。同時，如果你看每筆廣告收入佔總收入的百分比，它從去年同期的25%上升到第二季度的30%，這直接導致我們毛利潤的增長。

The one horizontal, one vertical strategy we mentioned last quarter is beginning to pay off, and that's been driving our advertising revenue growth. The one horizontal is actually referring to the technology middle platform and the data capability. It includes optimizing the recommendation model, improving the advertising inventory and matching efficiency and the application of AIGC to improve overall ad efficiency.

我們上季度提到的一橫向、一縱向策略已開始取得成效，這一直在推動我們的廣告收入增長。一橫實際上是指技術中平台和數據能力。包括優化推薦模型、提高廣告庫存和匹配效率以及AIGC的應用來提高整體廣告效率。

The one vertical is referring to the six customized industry app models, including games, e-commerce, FMCG, automotive and Internet service, among which e-commerce and games starting to show very positive results. In the second quarter, ad revenue from e-commerce industry grew by over 140% year-on-year and game -- and advertising revenue from game industry grew by over 40% year-on-year.

一垂直是指遊戲、電商、快消品、汽車、互聯網服務等六大定制行業應用模式，其中電商、遊戲開始顯現出非常積極的成效。第二季度，電商行業廣告收入同比增長超140%，遊戲行業廣告收入同比增長超40%。

The second reason is that since last year, we have sticked to the integration of content and commercialization and expand ad inventory in different scenes of the community on the basis of ensuring user experience. In the first half of this year, it has formed very good growth momentum and drove the accelerator at revenue growth.

第二個原因是，去年以來，我們堅持內容與商業化的融合，在保證用戶體驗的基礎上，擴大社區不同場景的廣告庫存。今年上半年已經形成了很好的增長勢頭，帶動了收入增長的加速器。

Thirdly is that you -- many of you probably already aware that we have established the training ecosystem, the ecosystem center, to focus on building video e-commerce-related capability in the second quarter by integrating the transactional scenario into the advertising products to further boost the revenue growth. We expect the video e-commerce-related ads would generate about 10% to 15% of ad revenue this year. And in the next few months is we also plan to upgrade the membership shopping (foreign language) on our main page to (foreign language) shopping tab and creating a new entrance for more commercial opportunities.

第三就是大家可能很多人已經知道我們建立了培訓生態圈、生態中心，第二季度重點打造視頻電商相關的能力，把交易場景融入到廣告產品中，進一步加強視頻電商相關能力的建設。促進收入增長。我們預計今年視頻電商相關廣告將佔廣告收入的 10% 至 15% 左右。並且在接下來的幾個月裡我們還計劃將主頁上的會員購物（外語）升級為（外語）購物選項卡，為更多的商業機會打造一個新的入口。

As for the June 18 period promotions, how we performed, through our in-depth data collaboration with e-commerce platform, the revenue of the e-commerce industry -- ad revenue from e-commerce industry, including transaction scenario during June 18 period, actually grew by 200% year-over-year. And we expect to achieve 15% to 16% ad revenue year-on-year increase from e-commerce industry during upcoming Double 11 festival. As for examples, we actually did a collaboration with Alibaba's Spark program AKA (foreign language) and the results exceeded our expectations.

至於6月18日期間的促銷，我們通過與電商平台的深度數據合作，電商行業的收入——電商行業的廣告收入，包括6月18日期間的交易場景是如何表現的，實際上同比增長了200%。我們預計雙11期間電商行業的廣告收入將同比增長15%至16%。舉個例子，我們實際上和阿里巴巴的Spark程序AKA（外語）進行了合作，結果超出了我們的預期。

There are a few interesting data points I can introduce. About 70% of the users who entered Taobao through Bilibili were new customers, and this ratio reached even to 90% for certain industry. That shows that we have the effective ability to consistently convert user to [advertisers]. In addition, Bilibili user maintained a very high conversion value 15 days after the related video was posted. And during June 18 period, the ad revenue from Alibaba actually increased by 300% year-over-year.

我可以介紹一些有趣的數據點。通過嗶哩嗶哩進入淘寶的用戶中，約有70%是新客戶，部分行業這一比例甚至達到90%。這表明我們有能力持續將用戶轉化為[廣告商]。此外，B站用戶在相關視頻發布15天后仍保持著極高的轉化值。而在6月18日期間，阿里巴巴的廣告收入實際上同比增長了300%。

While many other content platforms choose to build their own e-commerce platforms, Bilibili, on the other hand, we choose to take an open approach, partnering with e-commerce players and brand owners to grow the sales volume together on Bilibili.

當很多其他內容平台選擇建立自己的電商平台時，B站卻選擇採取開放的方式，與電商和品牌商合作，共同提高B站的銷量。

First of all, cultivating users' consumption behavior and mind share on Bilibili is our top priority. We believe that the young generation has strong willing to consume, and building the mind share is very important as we unleash their consumption power on our platform. In the first half of this year, near 30 million user clicked on the shopping link on Bilibili's video commentary section, which leaded to a transaction-related behavior. As we unleashing our user consumption demand, the number of videos that carries product links increased by 8x in the first half of this year, and the number of live broadcasting e-commerce shows increased by 7x in the first half of this year.

首先，培養用戶在嗶哩嗶哩的消費行為和心智份額是我們的首要任務。我們相信年輕一代有很強的消費意願，建立心智份額對於我們在平台上釋放他們的消費能力非常重要。今年上半年，有近3000萬用戶點擊嗶哩嗶哩視頻評論區的購物鏈接，引發了交易相關行為。隨著用戶消費需求的釋放，帶產品鏈接的視頻數量今年上半年增長了8倍，直播電商節目數量增長了7倍。

Secondly, we will continue to help our content creator to achieve sustainable operations through our video e-commerce initiatives. More content creator already started to try out Bilibili video e-commerce. This includes, but not limited to, many well-known content creators such as (foreign language) and et cetera. We are very delighted to find the model is very valid and successful, and this also broke the rumor that Bilibili's user have no consumption power. And actually, as a matter of fact, from the data that's shown that we have a lot of female user with consumption potential and power. Actually, 45% of Bilibili user are female. We do notice that they are -- they do have strong willingness to consume on Bilibili and they have strong purchasing powers.

其次，我們將繼續通過視頻電商舉措幫助內容創作者實現可持續運營。更多內容創作者已經開始嘗試嗶哩嗶哩視頻電商。這包括但不限於（外語）等眾多知名內容創作者。我們非常高興地發現這個模式非常有效和成功，這也打破了B站用戶沒有消費能力的謠言。事實上，從數據來看，我們有很多有消費潛力和消費能力的女性用戶。事實上，B站用戶中有45%是女性。我們確實注意到，他們在嗶哩嗶哩上的消費意願確實很強，購買力也很強。

Thirdly is that we intend to try more categories from our -- on top of our traditional strong verticals, in addition to the IP derivative AKA at our membership shopping, which is focused on the ACG preferential products and content. We intend to explore more categories such as food, beauty, 3C and digital products, home appliances and et cetera. And here is the example, in mid-April, Xiaomi launched a live broadcasting e-commerce show promoting its new cellphone. Based on the data that I have in hand, Bilibili ranked #1 in terms of GMV among all content platforms. It not only reflected that the strong word-of-mouth influence that we had among our young user group but also the strong consumption power our users had.

第三，我們打算在傳統的強勢垂直領域之外，嘗試更多的品類，除了我們會員購物中的IP衍生品AKA，重點是ACG優惠產品和內容。我們打算探索更多品類，例如食品、美妝、3C及數碼產品、家電等。舉個例子，4月中旬，小米推出了一場直播電商秀，宣傳其新手機。根據我掌握的數據，嗶哩嗶哩的GMV在所有內容平台中排名第一。這不僅體現了我們在年輕用戶群體中強大的口碑影響力，也體現了我們用戶強大的消費能力。

I think the Bilibili app model has evolved from establishing brand perception and mind share to a true integrated ad solution, a full advertising chain of brand building, seeding and sales conversion.

我認為嗶哩嗶哩應用模式已經從建立品牌認知度和心智份額演變成真正的綜合廣告解決方案，即品牌建設、播種和銷售轉化的完整廣告鏈。

In the first half of this year, we have upgraded our industry ad solution for game and e-commerce and transactional strategy and is already starting to show positive results. In the second half, I personally plan to conduct additional upgrade for our leading ad inventory -- ad industries such as FMCG, 3C and digital products. We believe as we deliver healthy and sustainable user growth, we are confident that we can achieve 25% to 30% ad revenue growth on a full year basis year-on-year.

今年上半年，我們升級了遊戲和電商的行業廣告解決方案和交易策略，並已開始顯現出積極的成果。下半年我個人計劃對我們領先的廣告庫存——快消、3C、數碼產品等廣告行業進行額外的升級。我們相信，隨著我們實現健康、可持續的用戶增長，我們有信心實現全年廣告收入同比增長 25% 至 30%。

Next question from Kenneth Fong from Credit Suisse.

瑞士信貸銀行的 Kenneth Fong 提出了下一個問題。

(foreign language) We noticed that we lowered the full year revenue guidance. Can you share with us the key considerations behind? Are we still on track for narrowing losses for this year?

（外語）我們注意到我們降低了全年收入指引。您能否與我們分享一下背後的關鍵考慮因素？今年我們是否仍有望縮小虧損？

(foreign language)

（外語）

[Interpreted] The reason why the guidance update is largely due to two reasons. Number one is a number of our games launch plan was delayed. And secondly is certain non-core business such as our comics and the IP derivative and others business is in the period of adjustment of strategy, and its revenue is lower than expected.

【解讀】之所以更新指導意見，很大程度上是由於兩個原因。第一是我們的一些遊戲發布計劃被推遲了。其次是一些非核心業務比如我們的漫畫和IP衍生品等業務正處於戰略調整期，收入低於預期。

The -- we believe the reason for guidance update, the core is just -- it's for a temporary phase change, and it's not a change of foundations. The core business actually remains intact. For example, the delay of games is just that we are recognizing the revenue a little bit later. For example, Pretty Derby is already scheduled to be launched in August 30. And this -- we will be releasing this game on that day. This is confirmed and certain.

我們認為指導更新的原因，其核心只是為了暫時的階段性改變，而不是基礎的改變。核心業務實際上仍然完好無損。例如，遊戲的延遲只是我們確認收入的時間晚了一點。例如，Pretty Derby 已計劃於 8 月 30 日推出。我們將在那天發布這款遊戲。這是已被證實和確定的。

And our outlook for -- and our confidence in the quality of the game and the revenue is unchanged.

我們對遊戲質量和收入的展望以及信心沒有改變。

And as you may already see that in the second quarter, the core business, Bilibili live broadcasting and advertising, has achieved very solid growth.

大家可能已經看到，第二季度，核心業務嗶哩嗶哩直播和廣告實現了非常穩健的增長。

We do expect that in the second half of this year and look forward to 2024, the advertising and live broadcasting business will sustain a very healthy and solid growth.

我們確實預計今年下半年並展望2024年，廣告和直播業務將保持非常健康和穩健的增長。

In the beginning of this year, we have set our financial target to increase gross profit and narrow our net losses. So as a requirement -- financial requirement or KPIs to each department business line is to ensure the absolute dollar growth for its gross profit.

今年年初，我們設定了增加毛利、縮小淨虧損的財務目標。因此，每個部門業務線的財務要求或 KPI 的要求是確保其毛利潤的絕對美元增長。

Strategically, we have lowered the revenue contribution of low-margin business or loss-making business, even though some of the revenue growth rate has been impacted. However, the absolute dollar of our gross profit has sustained a very healthy and robust growth.

戰略上，我們降低了低利潤業務或虧損業務的收入貢獻，儘管部分收入增速受到了影響。然而，我們毛利潤的絕對值卻保持了非常健康和強勁的增長。

In the second quarter, our gross profit grew by 66% year-on-year, and our gross margin has experienced four consecutive quarterly growth. And our adjusted net loss has narrowed by 51% year-on-year.

第二季度，我們的毛利潤同比增長66%，毛利率已連續四個季度增長。我們調整後的淨虧損同比收窄了51%。

I'm confident to achieve our loss-cutting target for 2023 and achieve our breakeven target by 2024.

我有信心實現 2023 年的減損目標，並在 2024 年實現盈虧平衡的目標。

Yes, this is Sam. I just want to add that on the loss reduction side, even though the revenue growth rate [and then called by] Mr. Chen already mentioned that, will be lower than expected. But we are still confident to achieve the loss-cutting target. We said in the beginning of this year, which is to cut our adjusted operation loss by RMB 3 billion. So through the gross profit increase and expense control.

是的，這是薩姆。我只想補充一點，在減少損失方面，儘管陳先生已經提到了收入增長率，但會低於預期。但我們仍然有信心實現減損目標。我們今年年初就說過，調整後的經營虧損要減少30億元。所以通過毛利的增加和費用的控制。

And notably, in the second quarter, our operating cash flow was close to breakeven. We think there are good chance that we can achieve operating cash flow positive in the fourth quarter this year.

值得注意的是，在第二季度，我們的運營現金流接近收支平衡。我們認為今年第四季度我們很有可能實現正運營現金流。

Additionally, we are confident to continue to improve our gross profit margin in the second half of this year and achieve our breakeven target by 2024.

此外，我們有信心在今年下半年繼續提高毛利率，並在 2024 年實現盈虧平衡目標。

Lastly, the updated full year guidance reflect our current projection of various potential outcome. We will try our best to ensure smooth product launch as well as achieve our goal of increasing the gross profit and narrowing losses.

最後，更新後的全年指引反映了我們目前對各種潛在結果的預測。我們將全力確保產品順利上市，實現毛利提升、虧損縮小的目標。

The next question from Yiwen Zhang from China Renaissance.

下一個問題來自華興資本的張一文。

(foreign language) My question is on the [our liking] business. Can you discuss on the pipeline and especially for the Pretty Derby? How should we think about your expectation? And also, can you talk about our self-development game strategy and the direction?

（外語）我的問題是關於[我們喜歡]的事情。您能否討論一下籌備過程，尤其是漂亮德比？我們應該如何考慮您的期望？另外，您能談談我們自研遊戲的策略和方向嗎？

(foreign language)

（外語）

[Interpreted] In the second half of this year, we have seven titles in our pipeline ready to be launched domestically and internationally. Among those 7, 5 of them have already gained approval and ready to be launched in the domestic market. Two will be launched internationally.

[解讀]今年下半年，我們有七款遊戲正在籌備中，準備在國內外推出。這7個產品中，有5個已經獲得批准，準備在國內市場上市。其中兩個將在國際上推出。

As for the highly anticipated game Pretty Derby, we have already scheduled the launch date to be August 30. And right now, within just 2 weeks of preregistration, over 2 million users are already preregistered for this game. This is a new record for -- in our operating history for the preregistration amount.

至於備受期待的《Pretty Derby》遊戲，我們已經將上線日期定在了8月30日。目前，在預註冊後的短短兩週內，已有超過200萬用戶預註冊了這款遊戲。這是我們運營歷史上預註冊數量的新紀錄。

Just because that it's such a highly anticipated games with large fan base, we actually spent a lot of effort doing the localization work, making sure that our gamers will be having the very original Pretty Derby experience. That's actually one of the reason why it has been delayed by several months.

正因為這是一款備受期待、粉絲眾多的遊戲，我們在本地化工作上確實花費了很多精力，以確保我們的玩家能夠享受到最原汁原味的漂亮德比體驗。這實際上是推遲幾個月的原因之一。

We believe that Bilibili's game launch team is the best ACG game launch team in China, and they are very experienced and they will make sure a very smooth and successful launch of Pretty Derby. And we're confident Pretty Derby will be a very successful title and also have good user feedback and reputation.

我們相信B站的遊戲發行團隊是中國最優秀的ACG遊戲發行團隊，他們經驗豐富，一定會確保《漂亮德比》的發行非常順利和成功。我們相信 Pretty Derby 將成為一款非常成功的遊戲，並且擁有良好的用戶反饋和聲譽。

As for our self-development pipeline, we have -- actually, we have two ACG card game will be launched in the second half of this year. This includes one game called (foreign language) which was already launched today, and there will be another game called (foreign language) This is -- will be scheduled to launch in October.

至於我們的自主開發管道，實際上，我們有兩款ACG卡牌遊戲將在今年下半年推出。其中包括今天已經推出的一款名為（外語）的遊戲，還有另一款名為（外語）的遊戲將於 10 月推出。

As for our self-development game strategy, as you may you are aware, there's been a very heavy competition among the game industry this year. As for our own self-development game, the strategy will remain unchanged, which is focus our -- on the content -- on the genres that Bilibili has most advantage of. Me, personally, will be spending a lot of time to ensure a success rate as we have only started doing self-development games, and we will be very down to earth and grounded to take a step-by-step approach to ensure every game that we launch will be high quality and will be successful. This is the target that I personally will spend a lot of time to ensure and also require our team to achieve.

至於我們自研遊戲的策略，大家也知道，今年遊戲行業的競爭非常激烈。至於我們自己的自研遊戲，策略不會改變，就是在內容上聚焦B站最有優勢的類型。我個人會花很多時間來保證成功率，因為​​我們才剛剛開始做自研遊戲，我們會腳踏實地、腳踏實地，一步步保證每一款遊戲的成功率。我們推出的產品將是高質量的並且會取得成功。這是我個人會花大量時間去確保的目標，也是要求我們團隊去實現的目標。

Secondly, it's about the long-term operation of the game. I believe in the future, all the game will be a long-term operation cycle. Otherwise, it won't make any profit. So this is the requirement I have for our self-development game. If the title from day one is not a long-term operation title, we won't be -- we won't allow it to be set up. As for the licensed game, if it's a long -- not a -- small life cycle game, we won't sign it, we won't license it. As for the game that's already online, the long life cycle management and operation will be -- also be one of the most important KPIs I have for the team.

其次，是關於遊戲的長期運營。我相信未來，所有的遊戲都將是一個長期的運營循環。否則，它不會獲得任何利潤。所以這就是我對我們自研遊戲的要求。如果從第一天起的頭銜就不是長期運營的頭銜，我們就不會——我們不會允許設立它。至於授權遊戲，如果它是一個生命週期較長的遊戲，而不是一個小型遊戲，我們不會簽署它，我們不會授權它。對於已經上線的遊戲，長生命週期的管理和運營也將是我為團隊制定的最重要的 KPI 之一。

As for Bilibili, we have very good track record on making sure a long life cycle operation. As a matter of fact, our Azur Lane just celebrated 6 years of anniversary. And FGO, just last week, we celebrated its seventh year anniversary. And all of the user data metrics remain very healthy for both of the games. As a matter of fact, during the sixth anniversary of FGO, its DAU even surpassed the 6 years anniversary DAU. So we will stick on this route and making sure that all of our game will sustain a long life operation cycle.

至於嗶哩嗶哩，我們在確保長生命週期運營方面擁有良好的記錄。事實上，我們的碧藍航線剛剛慶祝了六週年。還有《FGO》，就在上週，我們慶祝了它的七週年紀念日。這兩款遊戲的所有用戶數據指標都非常健康。事實上，《FGO》六週年期間，其日活甚至超過了六週年日活。所以我們會堅持走這條路，確保我們所有的遊戲都能維持較長的生命週期。

The next question from Lincoln Kong from Goldman Sachs.

下一個問題來自高盛的 Lincoln Kong。

(foreign language) So my question is about AIGC's application to Bilibili. So from past Investor Day, we already seen some development or strategy showcase in terms of AIGC speeding up the production efficiency, the marketing promotion tools as well as this AI-integrated search. Could management elaborate more around how we think about AIGC could benefit Bilibili?

（外語）所以我的問題是關於AIGC在Bilibili上的應用。所以從過去的投資者日開始，我們已經看到了AIGC在加快生產效率、營銷推廣工具以及人工智能集成搜索方面的一些發展或策略展示。管理層能否詳細說明我們如何看待 AIGC 可以使 Bilibili 受益？

(foreign language)

（外語）

[Interpreted] We believe this is a breakthrough technology of the AIGC we can bring to the industry. The way we look at it, it equals to the mobile Internet that happened 10 years ago and this will not only benefit Bilibili. It will actually benefit everyone.

【解讀】我們相信這是AIGC能夠給行業帶來的突破性技術。我們認為，這相當於10年前的移動互聯網，這不僅有利於嗶哩嗶哩。這實際上會讓每個人受益。

So as for Bilibili, our core business is video and ACG, and it is very -- it has been very clear that AIGC can enable an increased efficiency in a large amount on both fronts, for example, on content production as well as content recommendation. Also in terms -- based on the LLM, we can increase a lot of the efficiency of managing our community by understanding what the text means, the content means within our community. And we believe this technology, AIGC, has multifaceted applications and scenarios to help us to improve all around user experience.

那麼對於嗶哩嗶哩來說，我們的核心業務是視頻和二次元，很明顯，AIGC 可以在兩個方面大幅提高效率，例如內容製作和內容推薦。 。另外，基於法學碩士，我們可以通過理解文本的含義、內容在我們社區中的含義來提高管理社區的效率。我們相信AIGC這項技術具有多方面的應用和場景，可以幫助我們改善全方位的用戶體驗。

As for the application scenario, actually, we have already conduct some extended research and development. And we believe there's a lot of scenarios that we can leverage. For example, the prepared remarks that spoken by Sam just now before this Q&A session, actually, it was not actually conducted by Sam. It's powered by our self-developed AI tool, text-to-speech, TTS tool. And similar products like this, we have already starting to research and develop and apply it in our various scenarios.

至於應用場景，其實我們已經做了一些延伸的研究和開發。我們相信我們可以利用很多場景。比如剛才Sam在這個問答環節之前準備好的發言，其實並不是Sam自己做的。它由我們自主開發的人工智能工具、文本轉語音、TTS 工具提供支持。而類似這樣的產品，我們已經開始研發並應用在我們的各種場景中。

And there are other examples. For example, this year's Bilibili Macro Link, our live virtual host, 22 and 33, their voice was also generated by the same tool, TTS AI tool that Bilibili self-developed.

還有其他例子。比如今年的嗶哩嗶哩宏聯，我們的直播虛擬主播22和33，他們的聲音也是由同一個工俱生成的，即嗶哩嗶哩自研的TTS AI工具。

And another example would be knowledge-related video creation. As many knowledge content creators, they generally write the text and they record their voice. With the help of this AI tool, they can -- it can largely improve its production efficiency.

另一個例子是與知識相關的視頻創作。作為許多知識內容的創造者，他們通常編寫文本並錄製聲音。在這個人工智能工具的幫助下，他們可以大大提高生產效率。

As for the LLM, even though we haven't marketed quite aggressively, but actually, we have already started to apply LLM in various daily operations.

至於LLM，雖然我們的營銷力度還不是很大，但實際上我們已經開始將LLM應用到日常的各種運營中了。

Another example would be on the content auditing side. In the past, we have to spend a lot of human resource and power in managing the content with the help of large language models because it can understand the voice, the text, the meaning and all of the implied meanings behind the text. It can drastically increase the efficiency of how our content audit team process the content.

另一個例子是內容審核方面。過去，我們必須花費大量的人力資源和力量來借助大型語言模型來管理內容，因為它可以理解語音、文本、含義以及文本背後的所有隱含含義。它可以極大地提高我們的內容審核團隊處理內容的效率。

And another application scenario would be enhanced search because Bilibili has a vast content library, and each videos carries a lot of scatter information and we can leverage the LLM to drastically enhance the search efficiency. We're actually beta testing a new enhanced search that by just in typing question in our search box, our large language model can summarize and answer questions. A very valid example would be with the recent version upgrade of Genshin Impact, people can just simply ask which card is worth drawing and which character is worth spending time to improve. And the large language model can summarize the valid information and just provide it to the user versus in the past, they have to watch several videos to summarize that content information. Now they -- with a just stroke of hand, they can get the correct and fast answer.

另外一個應用場景是增強搜索，因為B站有海量的內容庫，每個視頻都帶有大量的分散信息，我們可以利用LLM來大幅提升搜索效率。我們實際上正在測試一種新的增強型搜索，只需在搜索框中輸入問題，我們的大型語言模型就可以總結並回答問題。一個非常有效的例子是最近的原神版本升級，人們可以簡單地問哪張卡牌值得抽，哪個角色值得花時間去改進。大語言模型可以總結有效信息並將其提供給用戶，而過去，他們必須觀看多個視頻才能總結內容信息。現在，他們只需輕輕一揮，就能得到正確而快速的答案。

Another function upgrade that we are testing is AI assistance. This will accompany users when they are watching a video, help them to summarize and extract useful information. For example, in a MacBook review video, user can ask the AI assistant, what's the difference between M2 Pro chip and the M2 chip? What's the price difference? What's the efficiency difference? And the AI assistant can extract the exact information to help the user to get what they want. This -- all of this will help to increase Bilibili user experience.

我們正在測試的另一個功能升級是AI輔助。這將陪伴用戶觀看視頻，幫助他們總結和提取有用的信息。例如，在MacBook評測視頻中，用戶可以詢問AI助手，M2 Pro芯片和M2芯片有什麼區別？價格相差多少？效率有什麼區別？ AI助手可以提取準確的信息，幫助用戶得到他們想要的東西。這一切都將有助於提高嗶哩嗶哩的用戶體驗。

Internally, we really value the AIGC technology. We believe this is a once-in-a-lifetime opportunity. This will be similar to the invention of mobile Internet, which enable Bilibili's mobile user grow by tenfold. And we believe with the AIGC technology matures, we can leverage this technology to largely enhance our user experience, our content creators' experience and productivity as well as increase our commercialization efficiency.

在內部，我們非常重視 AIGC 技術。我們相信這是一個千載難逢的機會。這將類似於移動互聯網的發明，使嗶哩嗶哩的移動用戶增長十倍。我們相信，隨著AIGC技術的成熟，我們可以利用這項技術來大幅提升我們的用戶體驗、內容創作者的體驗和生產力，並提高我們的商業化效率。

That concludes the questions. Operator, we can close the call today.

問題到此結束。接線員，我們今天可以結束通話。

And that concludes the question-and-answer session. Thank you once again for joining Bilibili's Second Quarter 2023 Financial Results and Business Update Conference Call today. If you have any further questions, please contact Juliet Yang, Bilibili Executive IR Director or Piacente Financial Communication. Contact information for IR in both China and U.S. site can be found on today's press release. Have a great day.

問答環節到此結束。再次感謝您今天參加 Bilibili 2023 年第二季度財務業績和業務更新電話會議。如果您還有任何疑問，請聯繫 Bilibili 執行投資者關係總監 Juliet Yang 或 Piacente Financial Communications。 IR 在中國和美國網站的聯繫信息可在今天的新聞稿中找到。祝你有美好的一天。

[Portions of this transcript that are marked [Interpreted] were spoken by an interpreter present on the live call.]

[本文字記錄中標記為[已翻譯]的部分是由現場通話中的口譯員朗讀的。]