Bilibili Inc (BILI) 2021 Q4 法說會逐字稿

Good day, and welcome to the Bilibili 2021 Fourth Quarter and Full Year 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.

Thank you, operator. During this call, we'll discuss our 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 filings with the SEC and Hong Kong Stock Exchange. The non-GAAP financial measures we provide are for comparison purpose only. Definition of these measures and a reconciliation table are available in today's news release we issued earlier today.

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.

Joining us today from Bilibili's 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.

Thank you, Juliet, and thank you, everyone, for participating in our 2020 first quarter results conference call. I'm pleased to deliver today's opening remarks on behalf of Mr. Chen.

Growth remained the key word for Bilibili throughout the year of 2021. In the fourth quarter, our MAUs rose to 272 million and mobile MAUs rose to 252 million, each representing a 35% increase year-over-year, making us one of the fastest growing companies in China's Internet space. At the same time, average daily time spent on our platform rose to 82 minutes with DAUs reaching 72 million in Q4, 34% more than the same period in 2020. In fact, we have more than doubled our MAUs in the past 3 years, far outpacing the industry growth rate, and this is no small feat.

Importantly, our expanding user scale translated to top line expansion with consistent quarterly growth in 2021. For the fourth quarter, our total revenues reached another record high of RMB 5.8 billion, up 51% year-over-year, and our full year revenues grew by 62% to RMB 19.4 billion. MPUs in Q4 grew to 24.5 million, up 37% year-over-year. And our paying ratio expanded to 9%. Above all, as we gain more users, more advertising dollars are being directed to our platform. Our full year advertising revenue reached to CNY 4.5 billion, up 145% year-over-year, spearheading our top line growth.

We firmly believe the value of our community is tied closely with the scale of our users and their level of trust in our platform. There is no doubt that our Gen Z+ users are the most valuable group in the market. They are our society's backbone and the mainstream consumers in all kinds of economies. Our engaging community connects and tightly bonds those users to our platform, creating an invaluable relationship built on trust, which leads to multiple avenues for commercialization.

Looking at our plan for 2022 in more detail, quality growth will remain our top priority. We will continue to build our multi-category content ecosystem, meeting users' video demands across various consumption scenarios. We remain committed to achieving our user target of 400 million MAUs by the end of 2023. While we grow our user base, we will continue to improve our commercialization capabilities. Specifically, we plan to increase our revenue per MAU by developing more value-added services to meet our users' evolving needs as well as increasing our ad revenue by optimizing our ad products and improving ad efficiency. Our revenue per MAU in 2021 increased by 20% year-over-year, and we expect this trend to continue.

More importantly, we plan to optimize our capital allocation and effectively control our spending across our business. In 2022, we will strengthen our execution and our commercialization capability and aim to narrow our loss margins. Meanwhile, we hold RMB 30 billion in cash reserves as of the end of 2021. This gives our ample liquidity to support our long-term growth strategy and provides a strong cushion in the evolving industry landscape.

With that overview, I'd like to go through some details on our fourth quarter operations as they relate to our content, community and commercialization. PUGVs continued to be our most prevalent feature, accounting for nearly 94% of our video views in the fourth quarter. As the bedrock of our ecosystem, we're actively expanding our PUGV content categories and scenarios to grow and tether our community together. Our top categories in the fourth quarter were lifestyle, games, entertainment, anime and knowledge. Our active users inspire our creators and vice versa, creating a reciprocal community environment that fuels our virtuous cycle. In the fourth quarter, over 3 million monthly active creators submitted nearly 11 million video creations. And that makes 58% more creators and 83% more submissions compared with the same period last year, outpacing our user growth.

Content creators with more than 10,000 followers increased by 41% in the fourth quarter, showing that our community connections was tighter than ever. We have continued to refine our algorithm and create avenues to unlock content creators commercial value, making sure they are seen, recognized and well rewarded. In January, we honored top 100 content creators at the Fourth Annual BILIBILI POWER UP 2021 Awards Ceremony. Notably, in 2021, over 1.3 million content creators received monetary rewards through various channels on Bilibili, covering near 90% of content creators with over 10,000 followers. Primary payment channels include our cash incentive program, live broadcasting, the Sparkle ad platform and the direct tipping from users. By the end of 2021, over 550,000 content creators have enrolled in our cash incentive program. On top of native ads on our Sparkle platform, we plan to launch more accessible and scalable ad tools and functions within or around video play frame to help better monetize content creators private domain traffic.

As part of our user growth strategy, we are upgrading our content ecosystem with a few different ways. The first is expanding our category outreach to appeal to different genders, occupations and age groups. Each of these groups bring us more avenues to grow our user base. For example, we are advancing our positions in the student community, adding more female-oriented content and expanding our pan-knowledge libraries' appeal to mature users.

Secondly, we are broadening our video formats to address users' needs in different access scenarios. Specifically, we are optimizing our short-form video Story Mode to fit into users' fragmented time. The initial feedback from our community is encouraging. It's not only satisfied content needs for users on the go and boosted the engagement levels, but also helped the users discover even more PUGVs and live broadcasting content across our video universe. Additionally, our Smart TV App that extends to living rooms is meeting our users' needs for immersive video experiences on large screen. These initiatives are aptly in sync with our brand proposition. All the videos you like, anywhere, any time.

For our OGV department, expanding our OGV categoryies is helping us attract new users, convert users to premium members and create valuable IP assets. Two main areas of focus will be Chinese anime and documentary. In November, we announced 51 new Chinese anime titles at our fourth Made by Bilibili Chinese Anime Press conference. As an imaginative art form, we believe that Chinese anime can transcend barriers of gender, race and language.

With our increasing global appeal, we also officially upgraded our Chinese anime proposition to Made by Bilibili, Made for Global. We are delighted to see our Chinese anime being highlighted for its originality, long-tail IP asset value and our successful globalization initiatives.

Over the past 2 years, we have established partnership with Netflix and Sony, distributing 24 titles in overseas markets. In 2021, our top-rated anime titles were The Daily Life of the Immortal King Season 2 and Link Click which not only won the heart of Chinese fans but also reached over 100 countries' anime markets.

We also hosted our first Documentary Press event in December and announced the plan to produce 21 new titles in the coming years. As our flagship content category, documentaries represent our useful content. In addition to commercial value, it's also bringing great cultural value and represents our commitment to social responsibility. Some of our docuseries have already turned into important IPs. In January, the return of our reading documentary, And Yet the Book, and police station reality show, The Guardians of Jiefangxi, were both met with great enthusiasm.

Turning to our community. Community surrounds and grounds our ecosystem. Our users and content creators form tight bonds and interactions creates trust, a strong sense of belonging, inspiration and retention value. We actively cultivate a fun, informative and friendly environment where users can express themselves in a supportive community. For the fourth quarter, we had remarkably high engagement and interaction levels, showing that both new and experienced members are finding connection and fun on Bilibili.

As mentioned previously, in Q4, the average daily time spent on Bilibili reached 82 minutes, the highest of fourth quarter usage time in our operating history and the daily video views soared to 2.2 billion, up 80% year-over-year. Monthly interactions in the fourth quarter more than doubled from the same period in 2020, jumping into 10.1 billion. We exited the year with 145 million official members, up 42% year-over-year and a strong 12-month retention rate of 84%.

Now let's look at our commercialization progress. In the fourth quarter, our total revenues reached RMB 5.8 billion, up 51% year-over-year, and our full year revenues grew by 62% to RMB 19.4 billion. Revenue per MAU was RMB 77.6 in 2021, up 20% year-over-year. Having gathered half of China's Gen Z+ population on our platform and understood their needs, we believe we can consistently improve our commercialization capabilities and continue to increase our revenue per MAU.

Beginning with our mobile game business, under the current game industry environment, our goal for 2022 is clear. We will enhance our current domestic game operations while we continue to focus on selectively developing games in-house and overseas games distribution. As for our games pipeline, we currently have 5 titles approved for domestic release and 13 titles slated for international release in the coming quarters.

For the fourth quarter, our mobile game revenues were RMB 1.3 billion, up 15% from the same period last year. We released 4 new titles domestically and 3 new titles in overseas markets during the quarter. Meanwhile, many of our older games were still showing long life cycles. Revenues were still on the rise for some of our exclusively licensed games such as Azur Lane.

As a game operator, we continue to protect young players from game addiction and promote healthy game behavior following the anti-addiction measures we launched early on for teenager players. In 2021, our revenues from players 18 years old accounted for less than 1% of our game revenues.

Looking at our VAS business. Our VAS business remained strong with revenues of RMB 1.9 billion in the fourth quarter, up 52% year-over-year. VAS revenue per MAU was RMB 27.8 in 2021, up 34% year-over-year. As we develop more products and services based on our users' entertainment needs, we believe VAS has great growth potentials beyond live broadcasting and the premium memberships. We will actively explore innovative avenues within our community to increase VAS revenue per MAU.

Live broadcasting, as an organic component of our video content ecosystem, has formed multiple self-reinforcing circulations within our community. For example, we see great synergies between content creators and live broadcasting hosts as well as their commercialization opportunities. In 2021, over 70% of our content creators with 1 million followers were live broadcasting hosts. Over 600,000 content creators generated income through live broadcasting during the year. In 2022, we will continue to explore innovative ways to incorporate live broadcasting with our video community and enhance users' overall experience.

Turning to our premium membership business. By the end of the fourth quarter, the number of premium memberships reached an exciting milestone of 20 million, representing an increase of 39% year-over-year. Notably, near 80% of our premium members signed up for an annual or continuous monthly plan, demonstrating their love and trust in our platform.

As for advertising, our advertising business is a great demonstration of how our value comes from our users and strong trust between them and the community. We hit another home run with advertising services in the fourth quarter. Ad revenue in Q4 reached RMB 1.6 billion, up 120% year-over-year. Full year ad revenue came in at RMB 4.5 billion, up 145% year-over-year. Ad revenue per MAU in 2021 was RMB 18.1, up 83% year-over-year. With nearly half of China's Gen Z+ users on our platform, Bilibili has become a must for advertisers looking to reach this golden consumer group.

Video-based integrated marketing campaigns has emerged as a key solution. In 2021, more of our native ads went viral, alerting even more advertisers to our powerful content and its influence among users. In 2022, we plan to further integrate our Sparkle ad platform with more scalable ad products. This will enable native ads to gain more exposure while realizing more efficient and smooth sales conversions on Bilibili, achieving the effects of brand and performance ads in one shot. Additionally, we plan to enrich our ad display scenarios with Story Mode and mart TV, greatly increasing our ad inventory and offering more places for advertisers to reach their desired customers.

We're glad to see our integrated marketing campaigns have been welcomed by more and more new industries. In 2021, we welcomed a well-known consumer brand and a premier automotive group and our key sponsors of the New Year's Eve Gala.

In the fourth quarter, our top 5 advertising verticals were mobile games, e-commerce, 3C and digital products, food and beverage and automotive. As we move through 2022, we expect visualization to continue paving the way for massive industry opportunities forward. We will continue expanding our user base, and we believe we are still in the initial stages of ramping our commercialization efforts.

In 2022, we will work to generate more revenue per MAU by introducing more value-added services to our users and valuable ad products to our partners. At the same time, we will focus on expense control and overall operating efficiency improvement.

This concludes Mr. Chen's remarks. I will now provide a brief overview of our financial results for the fourth quarter of 2021 and the outlook for the first quarter of 2022.

Total net revenues for the fourth quarter waere RMB 5.8 billion, up 51% from the same period of 2020. We continue to see a more balanced revenue mix driven by our diversified commercialization channels. Our total net revenues breakdown by revenue stream was approximately 22%, mobile games; 33%, VAS; 28%, advertising; and 17%, e-commerce and other business.

Cost of revenues increased by 62% year-over-year to RMB 4.7 billion. Revenue sharing cost, a key component of cost of revenues was RMB 2.4 billion, representing 91% increase from the same period in 2020.

Gross profit increased by 16% year-over-year to RMB 1.1 billion, and our gross margin was 19% in the fourth quarter. Total operating expenses waere RMB 3.1 billion, up 68% from the same period in 2020.

Sales and marketing expenses were RMB 1.8 billion, representing a 73% increase year-over-year. The increase was primarily attributable to increased channel and marketing expenses to promote our app and brand as well as promotional expenses for our mobile games.

Moving into 2022, we aim to actively manage and control our marketing spending and improve our overall operating efficiency. G&A expenses were RMB 538.1 million, representing a 57% increase year-over-year. The increase was primarily due to increased headcount in G&A personnel, share-based compensation expenses, allowance for doubtful accounts, rental expenses and other G&A expenses.

R&D expenses were RMB 797.6 million, representing a 65% increase year-over-year. The increase was primarily due to increased headcount in research and development team and share-based compensation expenses. Net loss was RMB 2.1 billion for the fourth quarter of 2021 compared with RMB 843.7 million in the same period of 2020.

Adjusted net loss, which is a non-GAAP measure that excludes share-based compensation expenses, amortization expense related to the intangible assets acquired through business acquisitions, income tax related to the intangible assets acquired through business acquisition and the loss of fair value change in publicly traded companies was RMB 1.7 billion compared with RMB 0.7 billion in the same period of 2020. Basic and diluted net loss per share were each RMB 5.34. Adjusted basic and diluted net loss per share was each RMB 4.22.

For the full year of 2021, our total net revenues increased by 62% to RMB 19.4 billion. Notably, non-game revenue for 2021 grew 99% year-on-year, accounting for 74% of the total revenue. Gross profit for the 2021 full year increased 42% to RMB 4 billion. Net loss for 2021 was RMB 6.8 billion compared with RMB 3.1 billion in 2020. Adjusted net loss for 2021 was RMB 5.5 billion compared with RMB 2.6 billion in 2020. Basic and diluted net loss per share for 2021 was RMB 17.87 as compared with RMB 8.71 in 2020. Adjusted basic and diluted net loss per share were RMB 14.42 compared with RMB 7.4 in 2020.

As of December 31, 2021, we had cash and cash equivalents, time deposits and short-term investments of RMB 30.2 billion compared with RMB 12.8 billion as of December 31, 2020.

Driving long-term value for all of our stakeholders remains our broader objective. We are pleased to announce an up to USD 500 million share repurchase program in the next 24 months. In addition, our Chairman and CEO, Chen Rui, also expressed his intention to use his personal funds to purchase the company's outstanding ADS for up to USD 10 million in the next 24 months. With that in mind, we are currently projecting net revenues for the first quarter of 2022 to be between RMB 5.3 billion and RMB 5.5 billion.

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

(Operator Instructions) Our first question is from Lei Zhang with Bank of America Merrill Lynch.

(foreign language) Firstly, a high-level question on your strategic focus in 2022. And secondly, on users side with our outlook in user growth for 2022 and how should we achieve our user target. Related to that, any color on the fourth quarter user and community investment?

(foreign language)

[Interpreted] Our key word for 2022 will still be focused on growth. Growth on the user side, on the revenue side and most importantly, we wanted to remain the growth quality. We want to keep it a high-quality growth.

For example, in Q4, we maintained a very high-quality user growth rate. Our MAU reached 272 million, up 35% year-over-year. And most importantly, the healthiness of that MAU is very strong. For example, the average daily time spent per DAU reached 82 minutes, and that is the highest the DAU time spent we've seen in the fourth quarter operating history.

And on the community engagement side, our monthly interactions grew over 116% year-over-year, reaching 10 billion. And on the retention side, the 12-month retention rate of our official member has further increased to 84%.

And on top of those engagement numbers, we noticed that all the users that come into our community have effectively converted to our paying users. In the fourth quarter, the monthly MPUs increased 37% year-on-year, outpacing the MAU growth rate, and our annual paying ratio reached 9%, which has improved from 8% from 2020 and 6-plus percent compared to 2019. And over -- this is very important over the period of growth we are able to deliver this quality set of numbers to show that we really have delivered high-quality growth rate.

As we look ahead, we still are very, very confident to achieve our 400 million MAU user target by end of 2023. And looking at our January number, our overall MAU have reached over 300 million milestone. And more importantly, the daily time spent per DAU has reached over 90 minutes. So the momentum -- growth momentum remained very, very strong, and we are confident to continue to deliver this high-quality, high-growth rate set of numbers.

As we look in the past, we think Bilibili is a very unique product across the global Internet landscape. We have maintained a fast and healthy growth rate for the past 13 years, and we think that contributes to our powerful content ecosystem-driven business model. And based on this business model, we're still very confident that this growth momentum can continue.

So if we're taking another look at our growth on the revenue side, for the past 2 years, we see revenue growth as important as our user growth. especially within our VAS and advertising segment, and they have been keeping roughly around 100% year-on-year growth rate.

As we look into our past work priority or resource allocation in the past 2 years, the energy we put in revenue growth versus user growth could split to 3 to 7 ratio. And for this year, we will adjust our resource allocation and split our energy and resource equally into both revenue growth and user growth. In other words, revenue growth will play a much more important role across our work priorities.

And on the other hand, we've noticed that there's being a fluctuation in the capital market. There's been a fluctuation on the stock price as well. And from another perspective, this is actually helping the overall industry to reduce the rat race. For example, on the sales and marketing side and compete for talent side, there's been a very, very heavy, intense rat race across the sector. And we believe that situation will alleviate this year, and we'll pay more attention to control our expenses and reduce our costs and improve our overall efficiency, putting every dollar we spend into more use. So that's the -- all the answers.

Our next question comes from Alex Yao with JPMorgan.

(foreign language) I'd like to ask a couple of questions on relatively new product, Story Mode. Can you share with us some of the latest thoughts around the product penetration rate? And then what kind of the role you want this product to play in our content ecosystem over the medium to longer term? Lastly, how do you guys think about the monetization potential and the revenue model for this product?

(foreign language)

[Interpreted] The product Story Mode actually has already been online last year. However, our users really -- they can tell -- they don't know the product name, it's called Story Mode because it's been integrated in our overall user interface. It's naturally embedded in our recommendation feeds to satisfy users' needs for this certain product.

The reason why we started the Story Mode is because, from my personal perspective, I think Bilibili should not be a tool. It should be a video community surrounded with people's needs, and that needs may involve multiple scenarios on multiple screens, whether it's mid- to longer form, whether it's in the horizontal format. We believe those content can be shorter, and they can also be a vertical format. It could also be live broadcasting. And addressing this trend or our understanding to users' needs, we launched the Story Mode to supplement our application scenarios.

In the last earnings report call, we mentioned our initiatives on the smart TV side. And those initiatives are -- adapt to this multi-scenario strategy, which we are putting our content into people's living rooms. And for the adoption of a Story Mode, we hope to satisfy users on-the-go entertainment needs in their fragmented time.

So if you have used Story Mode, you would notice even though the user interface is in vertical format, it might look like Douyin product. However, the actual experience will be full Bilibili-featured experience. For example, on our Story Mode, there's content range from 1 minute, 2 minutes, 3 minutes, and the quality is similar to our PUGV and there will be bullet-chats flying off the screen.

On the content category, we can see Story Mode as a very natural extension to our PUGV ecosystem. Massive number of Story Mode video has been produced by our PUGV content creators. In another way, just those content creators are leveraging this new outlet and new tools to create content.

On our product philosophy, it always has been surrounded by users and the product progress follows our users' needs towards video content. From several data point, we noticed that the adoption of Story Mode has been lightly accepted by our users. On the DAU level, the penetration is over 20% and over 30% if those news will be subject to the thumbs up, the likes, which means our users are accepting and loving this new product.

In summary, we think the user chooses content largely based on the content category and the overall community experience, not by the length of it. For example, a Coke lover would not care if the Coke is in a can or in a bottle. A soda lover wouldn't care if the Coke is black and Fanta is white. And all in all, it's the category, it's the content category and the community environment is helping users to decide which product they follow. And in my view, I think Story Mode as a product can be fully integrated, immersed in our content category as well as our community. In the not-so-distant future, the penetration could go -- could potentially reach to 50% or even above because after all, what attracts user, it's about the content category itself, not the length of the content or whether it's in the vertical format or in a horizontal format.

Lastly, on the commercialization potential because Story Mode is a product based on mobile devices and vertical format so on -- actually on -- in this industry, the commercialization of this product has been pretty mature, whether it's on the distribution of advertisement or its traffic interest for live broadcasting services. It's just about our implementation on the execution of our commercialization strategy. And based on our initial testing and initial data, we've noticed that it has very good efficiency -- distribution efficiency to commercial ads as well as our live broadcasting services. That would be all.

Our next question comes from Alex Poon with Morgan Stanley.

(foreign language) My question is related to our losses controlled in 2022, including how will our gross margin trend from Q1 to Q4 this year, assuming we don't get any game licenses approval. And also the by segment gross margin trend for including advertising and live streaming, how would that change this year and our headcount expansion plan and also the timetable for breakeven and profitability?

Thank you, Alex. Let me take this question. You are right. We agree that profitability is a key objective for all companies. Our company, we believe in long-term, we strive to find a balance between achieving a breakeven point and investing for long-term opportunities rather than just pursuing certain short-term financial metrics. We believe by doing so, it will maximize the interest of our shareholders.

As mentioned by our CEO, we are confident that while maintaining a healthy user and revenue growth, the non-GAAP operating loss ratio could be narrowed on a year-over-year basis starting from 2022. By improving the monetization efficiency including the revenue per MAU and control the operating expenses, the target is to achieve the breakeven point on a non-GAAP basis by 2024.

Let's look into the details. First of all, we aim to proactively manage our operating expense. Selling marketing expense, for example, is measurable and controllable. For example, the user acquisition cost is a big component of our sales and marketing expenses only increased by 50%, while our total revenue increased by 61% year-over-year in 2021. There are still room to further optimize the marketing spending while we reach 400 million MAU target. We expect the total sales and marketing expenses as a percentage of revenue will decline starting from 2022.

In R&D expenses, mainly include the personnel costs associated with developing the new games, enhancing the data capabilities and optimizing the new product features, which are critical to increase our productivity and monetization capability.

Understood the importance of attracting talents, in 2022, we will continue to invest in R&D, but we will closely monitor the ROI for all of our R&D projects. We expect that R&D expenses as a percentage of total revenue will start to show significant leverage from 2023 onwards.

Secondly, there are still ample room for improvement in user monetization efficiency. We are still in a very early stage of commercialization. Our revenue per MAU increased by 20% last year. The increase was mainly driven by a 34% increase in VAS revenue per MAU and an 83% increase in ad revenue per MAU. Looking forward, those trends will continue, and we expect both VAS and ad revenue per MAU would have potential to double their current levels in 3 years.

Last but not least, as you asked the gross profit margin. While our game business undergoes a transition period, we are happy to see revenue contribution from advertising has risen from 13% in 2020 to 23% in 2021 and expect it to further increase in 2022 in this year.

In addition, we expect to introduce more VAS services and further improve the VAS gross margin.

As a result, with the improvement of our commercialization capabilities, I think that overall, the 2022 gross margin is expected to be slightly lower in Q1 this year but will gradually improve during this year. And in the 3 years, the overall gross profit margin will be improved around 30% in 3 years. That will be all.

And for the headcount, I'll translate for Mr. Chen's remarks.

(foreign language)

[Interpreted] Actually, in the past few years, the growth rates have slowed for the number of our staff. And as for 2022, there's going to be a very limited headcount increase. My request for our HR this year is laser-focused on the business areas that we wanted to have decent growth. And for those areas, we can add certain headcounts and the rest of the business is controlled.

Our next question comes Felix Liu with UBS.

(foreign language) Congratulations on the 4Q results, especially on the strong ad performance. I would like to ask a question on the ad outlook for 2022 as well as on the first quarter, especially in light of recent macro weakness as well as the temporary suspension in new game license. And also, could you elaborate on your key commercialization initiatives for advertisements for 2022?

(foreign language)

[Interpreted] I would like to take this opportunity to share with you the growth driver behind Bilibili's advertisement business. And you can see in the past few quarters, our advertisement revenue has been growing over 100%, has been very strong. And we also heard suspicions from the market that Bilibili's user experience is so good, how can you drive your advertising revenue without compromising user experience?

So the #1 reason is that we have experienced a very strong user growth. And at the same time, our ad efficiency per user has also been increasing pretty nicely. In the fourth quarter, our DAU grew 34% year-over-year. And on a full year level in 2021, the ad revenue per MAU has increased 83% and for those 2 factors combined together, that gives you the over 100% ad revenue growth.

And the second growth driver would be the value of Bilibili's user has been increasing. And at the same time, the influence of our platform has been well recognized by the market. If we look in the past few years on the horizontal perspective, our user has been growing pretty nicely. And in a vertical view, we actually have constantly breaking up our own circle and make -- allowing more users, more different groups of user occupation, gender, user being seen and recognize the existence of Bilibili and that leads to more attention from different advertising verticals.

For example, in the past few years, we -- our leading verticals would be games and 3C digital products. And this slowly extended to skin care and cosmetics, food and beverage. And for this year, we are looking to expand into verticals like automotive. As a matter of fact, in fourth quarter last year, automotive has become our top 5 advertising industry verticals.

And the third growth driver would be the visualization of advertisement. More and more advertisement will be presented in a format of videos. And that's why we are adopting this trend, launching products like top view, different advertising format based on our different video format, including native ads, Story Mode. In the launch of Story Mode, it will also be adapting to current industries, the advertisement videos in vertical format and all of this will help us to drive our advertising growth in the next few years.

And the fourth growth driver would be our own unique advertising format a.k.a our native ads. The Bilibili native ads largely were produced by our content creators. They're actually combining their creativity to customize an advertisement within its own video. It's known as our Sparkle native ads. We are delighted to see more and more advertisers has been adapting and recognize this innovative format of advertisement. In 2021, in the fourth quarter of 2021, over 4,000 advertisers has been investing in our Sparkle ad platform. The repeated purchase rate has reached 75%.

On the other hand, more and more content creator has signed up for our Sparkle platform. In 2021, over 22,000 content creator has signed up on our Sparkle platform to open themselves to this native ads opportunity.

We think the native ads is a very, very important format of advertisement for Bilibili. It's like a reservoir for us to keep the advertisers. The native ads, the content creator is helping us to attract those advertisers. They are staying with us, what we need to do next is to further integrate the native ads with more of our standardized, scalable advertising formats to allow native ads to help us to drive the sale of our other standard advertisement products.

Lastly, the last growth driver was the multi-scenario multiscreen strategy. We believe by further integrate those scenarios and devices, we can help us to open more ad inventories and improve our overall ad efficiency.

From the data perspective, as our PUGV continued to expand rapidly, the new territory, which is the smart devices, smart TV and Story Mode is helping us open up more scenarios more devices and more video content and leverage for commercial advertisement opportunities.

In summary, I've always believed that the increase of revenue, ad revenue, does not conflict with user experience. In other way, actually, it actually shared the same goal because we believe the effect of an advertisement largely depends on the platform's influence among users' mindset and a good platform can really put that influence to its users. Hence, the goal is connected.

As for the outlook for 2022, despite the macro environment headwinds and slowdown of digital advertisement, because of those 5 growth drivers I mentioned earlier, we are confident under this environment, we can still deliver a healthy, stable ad revenue growth, at least above industry average. That will be all.

And that concludes the question-and-answer session. I would like to turn the back over to management for any additional or closing comments.

Thank you, once again, for joining us today. If you have further questions, please contact me, Juliet Yang, Bilibili Executive IR Director, or TPG Investor Relations. Our contact information for IR in both China or in the U.S. can be found on today's press release. Have a great day. Thank you. Bye-bye.

This concludes today's conference call. Thank you for participating. You may now disconnect.