BILIBILI-W：2023InterimReport.pdf

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1、Bilibili Inc.HKEX:9626 NASDAQ:BILI(A company controlled through weighted voting rights and incorporated in the Cayman Islands with limited liability)2023 INTERIM REPORTBilibili Inc.2023 Interim Report ContentsCompany Information 2Financial Highlights 3Business Review and Outlook 6Management Discussi

2、on and Analysis 11Corporate Governance 16Other Information 21Report on Review of Interim Financial Information 31Unaudited Interim Condensed Consolidated Balance Sheet 33Unaudited Interim Condensed Consolidated Statement of Operations and Comprehensive Loss 36Unaudited Interim Condensed Consolidated

3、 Statement of Changes in Shareholders Equity 38Unaudited Interim Condensed Consolidated Statement of Cash Flows 40Notes to Unaudited Interim Condensed Consolidated Financial Information 43Definitions 772Bilibili Inc.2023 Interim Report Company InformationBOARD OF DIRECTORSDirectorsMr.Rui Chen(Chairm

4、an and Chief Executive Officer)Ms.Ni LiMr.Yi XuIndependent DirectorsMr.JP GanMr.Eric HeMr.Feng LiMr.Guoqi DingAUDIT COMMITTEEMr.Eric He(Chairman)Mr.JP GanMr.Feng LiCOMPENSATION COMMITTEEMr.JP Gan(Chairman)Mr.Eric HeMr.Feng LiNOMINATING AND CORPORATE GOVERNANCE COMMITTEEMr.JP Gan(Chairman)Mr.Eric HeM

5、r.Feng LiJOINT COMPANY SECRETARIESMr.Xin FanMs.Chau Hing Ling Anita(FCG,HKFCG)AUTHORIZED REPRESENTATIVESMr.Yi XuMr.Xin FanMs.Chau Hing Ling AnitaPRINCIPAL EXECUTIVE OFFICES OF MAIN OPERATIONSBuilding 3,Guozheng CenterNo.485 Zhengli RoadYangpu DistrictShanghaiPeoples Republic of ChinaADDRESS IN HONG

6、KONGSuite 603,6/F,Laws Commercial Plaza788 Cheung Sha Wan RoadKowloonHong KongREGISTERED OFFICEWalkers Corporate Limited190 Elgin AvenueGeorge TownGrand Cayman KY1-9008Cayman IslandsCAYMAN ISLANDS PRINCIPAL SHARE REGISTRARWalkers Corporate Limited190 Elgin AvenueGeorge TownGrand Cayman KY1-9008Cayma

7、n IslandsHONG KONG SHARE REGISTRARComputershare Hong Kong Investor Services LimitedShops 17121716,17th FloorHopewell Centre183 Queens Road EastWanchaiHong KongCOMPLIANCE ADVISERSomerley Capital Limited20th Floor,China Building29 Queens Road CentralHong KongPRINCIPAL BANKChina Merchants Bank Shanghai

8、 BranchSTOCK CODEHKEX:9626NASDAQ:BILIAUDITORPricewaterhouseCoopersCertified Public Accountants and Registered Public Interest Entity Auditor22/F,Princes BuildingCentralHong KongCOMPANY WEBSITEhttps:/ Inc.2023 Interim Report Financial Highlights For the Six Months Ended June 30,20222023Change(%)RMBRM

9、B(in thousands,except for percentages)Net revenues9,963,03010,373,8104.1%Gross profit1,545,5262,331,46650.9%Loss before income tax(4,237,976)(2,122,187)(49.9%)Net loss(4,294,577)(2,177,777)(49.3%)Net loss attributable to the Bilibili Inc.s shareholders(4,288,909)(2,174,393)(49.3%)Non-GAAP Financial

10、Measures:Adjusted net loss(3,622,848)(1,994,852)(44.9%)Adjusted net loss attributable to the Bilibili Inc.s shareholders(3,617,180)(1,991,468)(44.9%)As of2022December 31As of2023June 30Change(%)RMBRMB(in thousands,except for percentages)Total current assets24,452,88818,710,694(23.5%)Total non-curren

11、t assets17,377,68216,184,663(6.9%)Total assets41,830,57034,895,357(16.6%)Total liabilities26,590,98318,362,675(30.9%)Total shareholders equity15,239,58716,532,682 8.5%Total liabilities and shareholders equity41,830,57034,895,357(16.6%)Non-GAAP Financial MeasuresThe Company uses non-GAAP measures,suc

12、h as adjusted net loss and adjusted net loss attributable to the Bilibili Inc.s Shareholders,in evaluating its operating results and for financial and operational decision-making purposes.The Company believes that the non-GAAP financial measures help identify underlying trends in its business by exc

13、luding the impact of share-based compensation expenses,amortization expense related to intangible assets acquired through business acquisitions,income tax related to intangible assets acquired through business acquisitions,loss/gain on fair value change in investments in publicly traded companies,ga

14、in on repurchase of convertible senior notes,expenses related to organizational optimization,and termination expenses of certain game projects.The Company believes that the non-GAAP financial measures provide useful information about the Companys results of operations,enhance the overall understandi

15、ng of the Companys past performance and future prospects and allow for greater visibility with respect to key metrics used by the Companys management in its financial and operational decision-making.4Bilibili Inc.2023 Interim Report Financial Highlights The non-GAAP financial measures are not define

16、d under U.S.GAAP and are not presented in accordance with U.S.GAAP and therefore may not be comparable to similar measures presented by other companies.The non-GAAP financial measures have limitations as analytical tools,and when assessing the Companys operating performance,cash flows or liquidity,i

17、nvestors should not consider them in isolation,or as a substitute for net loss,cash flows provided by operating activities or other consolidated statements of operations and cash flows data prepared in accordance with U.S.GAAP.The Company mitigates these limitations by reconciling the non-GAAP finan

18、cial measures to the most comparable U.S.GAAP performance measures,all of which should be considered when evaluating the Companys performance.The following table sets forth unaudited reconciliation of GAAP and non-GAAP results for the periods indicated.For the Six Months Ended June 30,20222023RMBRMB

19、(in thousands)Net loss(4,294,577)(2,177,777)Add:Share-based compensation expenses 534,560561,548 Amortization expense related to intangible assets acquired through business acquisitions96,33596,302 Income tax related to intangible assets acquired through business acquisitions(18,009)(11,250)Loss/(ga

20、in)on fair value change in investments in publicly traded companies 335,929(181,233)Gain on repurchase of convertible senior notes(475,790)(282,442)Expenses related to organizational optimization89,650 Termination expenses of certain game projects 109,054Adjusted net loss(3,622,848)(1,994,852)5Bilib

21、ili Inc.2023 Interim Report Financial Highlights For the Six Months Ended June 30,20222023RMBRMB(in thousands)Net loss attributable to the Bilibili Inc.s shareholders(4,288,909)(2,174,393)Add:Share-based compensation expenses 534,560561,548 Amortization expense related to intangible assets acquired

22、through business acquisitions96,33596,302 Income tax related to intangible assets acquired through business acquisitions(18,009)(11,250)Loss/(gain)on fair value change in investments in publicly traded companies 335,929(181,233)Gain on repurchase of convertible senior notes(475,790)(282,442)Expenses

23、 related to organizational optimization89,650 Termination expenses of certain game projects 109,054 Adjusted net loss attributable to the Bilibili Inc.s shareholders(3,617,180)(1,991,468)6Bilibili Inc.2023 Interim Report Business Review and OutlookBUSINESS REVIEW AND OUTLOOKOur top priority for 2023

24、 is to improve our commercialization efficiency and narrow our losses.In the first half of this year,we have made solid steps toward these goals.We meaningfully improved our gross profit and cut our losses,while continuing to deliver healthy DAU growth and strong community metrics.In the first half

25、of this year,we further improved our commercialization efficiency,enabling us to convert our growing traffic into quality revenue growth.The momentum we have seen in our advertising and live broadcasting business is encouraging.In the first half of 2023,our advertising revenues increased by 29%while

26、 our live broadcasting revenues grew by 23%,both on a year-over-year basis.Moreover,our gross profit increased by 51%year-over-year,driving our gross profit margin to 22.5%from 15.5%in the same period of last year.Meanwhile,we have strengthened our expense controls.Our total operating expenses decli

27、ned by 13%,including a 26%decrease in sales and marketing expenses,a 4%decrease in general and administrative expenses and a 3%decrease in research and development expenses,all on a year-over-year basis.The advancements we made with our margin and effective cost management contributed to our improve

28、d bottom line.As a result,in the first half of 2023,our net loss and adjusted net loss narrowed by 49%and 45%year-over-year,respectively.While we focused on improving our financial metrics,we continued to attract more users and enhance the engagement levels of our community.In the first half of this

29、 year,our DAUs grew by 17%year-over-year to over 95 million,while our MAUs reached 319 million,driving our DAU/MAU ratio to 29.8%,up from 27.2%in the same period last year.Our users continue to value our evolving and diverse content with the average daily time spent on Bilibili reaching 95 minutes i

30、n the first half of this year,bringing users total time spent on our platform increased by 21%year-over-year.7Bilibili Inc.2023 Interim Report Business Review and OutlookContentOur content ecosystem continues to be our most prized asset.In the first half of 2023,we remained steadfast in our commitme

31、nt to crafting a comprehensive video platform that empowers content creators and users to explore novel interests,earn recognition and forge connections.The diverse tapestry of Bilibilis content verticals naturally unfurls in response to users evolving interests.These encompass domains such as autom

32、otive,home decoration and professional pursuits,mirroring the progressive journey of our young users through their various life phases.Furthermore,we have extended our content scenarios to align with users diversified video watching preferences.In addition to professional user-generated videos(“PUGV

33、s”),live broadcasting and Smart TV,our short-form vertical video product,known as Story Mode,caters to our users video consumption needs during their fragmented time.In the first half of this year,our total daily video views increased by 34%year-over-year to 4.1 billion.Story Modes daily video views

34、 grew by 78%year-over-year,while PUGV average daily video views increased by 22%year-over-year.Story Mode has become one of the key video consumption scenarios for our users,contributing to growth in our DAUs and commercialization in areas such as advertising and live broadcasting.Content creators a

35、re an essential component of our content ecosystem.Supporting our talented content creators visibility,as well as their ability to earn more money,are among our top tasks.In the first half of 2023,we continued to optimize our algorithms and products to facilitate high-quality content and enable crea

36、tors to be recognized.The number of daily active content creators on our platform and our monthly content submissions increased by 30%and 61%year-over-year,respectively,in the first half of this year.By further integrating our commercial channels within our ecosystem,we continued to empower content

37、creators to realize their commercial value through diverse avenues.In the first half of this year,over 2.1 million creators earned money through various Bilibili channels,representing a 41%increase year-over-year.In addition to our cash incentive program,more creators are earning income through mult

38、iple commercialization channels,such as advertising,live broadcasting,online paid courses and workshops.We are also exploring the integration of AI applications within our content ecosystem.Utilizing AI-generated content(“AIGC”)can enhance both content creation efficiency and user experience.We beli

39、eve it holds great promise and tremendous potential for the video industry.Leveraging these evolving technologies,we can further enrich our content supply,empowering our creators to bring their visions to life more easily and effectively.We are also beta testing new features powered by AIGC,includin

40、g an AI-powered search feature,to further enhance user experience and offer personalized and captivating content that deeply engages our user community.8Bilibili Inc.2023 Interim Report Business Review and OutlookCommunityThe inspiring community atmosphere and diverse interactive features we provide

41、 are fostering strong connections between our users and our platform.The average daily time spent on our platform was 95 minutes in the first half of this year,the highest level for a first half year period in our operating history.Users monthly interactions reached around 14.6 billion in the first

42、half of this year,up 17%year-over-year.As of the end of June 2023,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 two

43、exciting offline events:Bilibili World and Bilibili Macro Link in Shanghai.Over 200,000 tickets were sold out almost immediately.The tremendous response highlights Bilibilis strong influence and leadership among young generations in China,as well as users strong willingness to pay for our unique com

44、munity experiences.CommercializationIn 2023,we focus on enhancing efficiency,improving gross profit and reducing losses.We have intensified the integration of commercial initiatives including advertising and live broadcasting throughout our ecosystem,and streamlined our resources toward our core com

45、mercial businesses.We remain steadfast in our commitment to achieving our financial goals,while nurturing a welcoming and inspiring user community.Value-Added ServicesRevenues from value-added services business were RMB4.5 billion in the first half of this year,representing an increase of 7%from the

46、 first half of 2022,primarily driven by the revenue growth of our live broadcasting business which increased by 23%year-over-year.We continue to integrate our live broadcasting capabilities within our video ecosystem.As one of the primary ways for creators to monetize their talent,more creators are

47、making the transition to live broadcasting hosts.In the first half of this year,the number of monthly active live broadcasting hosts increased by 24%year-over-year.Meanwhile,we are exploring new live broadcasting products to create more paying channels for our users.Meanwhile,we continued to enrich

48、our occupationally-generated videos(“OGVs”)library and convert more users to premium memberships.By the end of June,we had around 20.5 million premium members.Over 80%of these were annual or auto-renew package subscribers,which represents users strong trust in our brand and content offerings.9Bilibi

49、li Inc.2023 Interim Report Business Review and OutlookAdvertisingRevenues from advertising business were RMB2.8 billion in the first half of this year,representing an increase of 29%from the first half of 2022,mainly led by our performance-based advertising revenue growth,which increased by 58%year-

50、over-year.Revenues from brand advertising and Sparkle advertising offerings also grew by double digit percentages year-over-year for the period.In the first half of 2023,we continued to expand and optimize our advertising product offerings.At the same time,we have been continuously building our comm

51、ercial database and improving our ad algorithm to drive better results for our advertising clients.As we progress our initiative to integrate sales conversion with advertising products,we have found an effective way to convert our high-quality traffic to advertising revenue growth.Mobile Games Servi

52、cesOur revenues from mobile games services were RMB2.0 billion in the first half of this year,representing a decrease of 16%from the first half of 2022,mainly due to the lack of new game launches and revenue declines from certain games.The performance of our top two performing games,Azur Lane and Fa

53、te Grand Order,remained stable.Particularly,during Azur Lanes six-year anniversary,the game reached new peaks in paying users and revenues.We remain dedicated to our in-house development of high-quality games.We believe top-tier games built on a deep understanding of user needs can generate profitab

54、ility over the long run.Inclusion of Class Z Ordinary Shares in the Shenzhen-Hong Kong Stock Connect and Shanghai-Hong Kong Stock Connect ProgramsOur Class Z Ordinary Shares traded on the Stock Exchange have been included in the Shenzhen-Hong Kong Stock Connect and Shanghai-Hong Kong Stock Connect p

55、rograms,both effective March 13,2023.Following the inclusion,eligible investors in the Chinese Mainland can have direct access to the trading of the Companys Class Z Ordinary Shares.Repurchase of Convertible Senior NotesIn January 2023,the Company repurchased an aggregate principal amount of US$384.

56、8 million(RMB2.6 billion)December 2026 Notes with an aggregate consideration of US$331.2 million(RMB2.2 billion)that was funded by the Companys ADS issuance.In June 2023,the Company completed the repurchase right offer for its 2027 Notes.An aggregate principal amount of US$745.9 million(RMB5.3 billi

57、on)2027 Notes was validly surrendered and repurchased with an aggregate cash consideration of US$745.9 million(RMB5.3 billion).The total gain on repurchase of December 2026 Notes and 2027 Notes was RMB282.4 million for the six months ended June 30,2023.As of June 30,2023,the aggregate outstanding pr

58、incipal amount of April 2026 Notes,2027 Notes and December 2026 Notes was RMB6.3 billion(US$876.3 million).10Bilibili Inc.2023 Interim Report Business Review and OutlookRecent Development after the Reporting PeriodSave as disclosed in this interim report,there were no other significant events that m

59、ight affect us since the end of the Reporting Period and up to the Latest Practicable Date.BUSINESS OUTLOOKIn the first half of the year,we accelerated our monetization efforts and improved gross profit and narrowed losses,while continuing to foster the healthy growth of our community.As we move int

60、o the second half of this year,our main tasks will focus on the following three core areas:First,we aim to further enhance our traffic commercialization efficiency by increasing our advertising revenues and live broadcasting revenues.Additionally,we will bring more high-quality games to our users,in

61、cluding the highly anticipated Pretty Derby.Secondly,we will continue to take a prudent financial approach with strict control of our costs and expenses,and further narrow our losses.Last but not least,we are committed to achieving ongoing healthy DAU growth,and will continue to foster an inspiring

62、video community for young generations in China.11Bilibili Inc.2023 Interim Report Management Discussion and Analysis For the Six Months Ended June 30,20222023(Unaudited)(Unaudited)(RMB in thousands)Net Revenues:Mobile games2,404,0542,022,503 Value-added services(VAS)4,155,650 4,457,965 Advertising2,

63、199,0222,844,644 IP derivatives and others(formerly known as E-commerce and others)1,204,3041,048,698 Total net revenues9,963,03010,373,810 Cost of revenues(8,417,504)(8,042,344)Gross profit1,545,5262,331,466 Operating expenses:Sales and marketing expenses(2,425,888)(1,798,383)General and administra

64、tive expenses(1,160,961)(1,111,394)Research and development expenses(2,140,551)(2,074,033)Total operating expenses(5,727,400)(4,983,810)Loss from operations(4,181,874)(2,652,344)Other(expenses)/income:Investment(loss)/income,net(including impairments)(544,273)8,321 Interest income90,268298,300 Inter

65、est expense(123,612)(105,682)Exchange losses(21,526)(16,552)Debt extinguishment gain475,790282,442 Others,net67,25163,328 Total other(expenses)/income,net(56,102)530,157 Loss before income tax(4,237,976)(2,122,187)Income tax(56,601)(55,590)Net loss(4,294,577)(2,177,777)Net loss attributable to:Bilib

66、ili Inc.s shareholders(4,288,909)(2,174,393)Noncontrolling interests(5,668)(3,384)Net loss(4,294,577)(2,177,777)12Bilibili Inc.2023 Interim Report Management Discussion and Analysis NET REVENUESTotal net revenues were RMB10.4 billion for the six months ended June 30,2023,representing an increase of

67、4%from RMB10.0 billion for the six months ended June 30,2022.Value-added services(VAS)Revenues from VAS were RMB4.5 billion for the six months ended June 30,2023,representing an increase of 7%from RMB4.2 billion for the six months ended June 30,2022.The increase was led by an increased amount of ave

68、rage revenues generated from each paying user for the Companys value-added services,including live broadcasting and other value-added services.AdvertisingRevenues from advertising were RMB2.8 billion for the six months ended June 30,2023,representing an increase of 29%from RMB2.2 billion for the six

69、 months ended June 30,2022.This increase was mainly attributable to the Companys improved advertising product offerings and enhanced advertising efficiency.Mobile gamesRevenues from mobile games were RMB2.0 billion for the six months ended June 30,2023,representing a decrease of 16%from RMB2.4 billi

70、on for the six months ended June 30,2022,mainly attributable to the lack of new game launches as well as revenues decline from certain games for the six months ended June 30,2023.IP derivatives and others(formerly known as E-commerce and others)Revenues from IP derivatives and others were RMB1.0 bil

71、lion for the six months ended June 30,2023,representing a decrease of 13%from RMB1.2 billion for the six months ended June 30,2022,mainly attributable to decreased revenue from e-sports copyright sub-licensing.13Bilibili Inc.2023 Interim Report Management Discussion and Analysis COST OF REVENUESCost

72、 of revenues was RMB8.0 billion for the six months ended June 30,2023,representing a decrease of 4%from RMB8.4 billion for the six months ended June 30,2022.The decrease was mainly due to lower server and bandwidth costs and others costs.Revenue-sharing costs,a key component of cost of revenues,was

73、RMB4.2 billion,remaining stable from RMB4.2 billion for the six months ended June 30,2022.Server and bandwidth costs represented a decrease of 14%for the six months ended June 30,2022.GROSS PROFITGross profit was RMB2.3 billion for the six months ended June 30,2023,representing an increase of 51%fro

74、m RMB1.5 billion for the six months ended June 30,2022,primarily due to the Companys improved operating leverage,as the Company enhanced its monetization efficiency.OPERATING EXPENSES Total operating expenses were RMB5.0 billion for the six months ended June 30,2023,representing a decrease of 13%fro

75、m RMB5.7 billion for the six months ended June 30,2022.Sales and marketing expensesSales and marketing expenses were RMB1.8 billion for the six months ended June 30,2023,representing a 26%decrease from RMB2.4 billion for the six months ended June 30,2022.The decrease was primarily attributable to re

76、duced promotional spending related to user acquisition for the six months ended June 30,2023.General and administrative expensesGeneral and administrative expenses were RMB1.1 billion for the six months ended June 30,2023,representing a 4%decrease from RMB1.2 billion for the six months ended June 30

77、,2022.Research and development expensesResearch and development expenses were RMB2.07 billion for the six months ended June 30,2023,representing a 3%decrease from RMB2.14 billion for the six months ended June 30,2022.LOSS FROM OPERATIONSLoss from operations was RMB2.7 billion for the six months ende

78、d June 30,2023,narrowing by 37%from RMB4.2 billion for the six months ended June 30,2022.14Bilibili Inc.2023 Interim Report Management Discussion and Analysis TOTAL OTHER(EXPENSES)/INCOME,NETTotal other income was RMB530.2 million for the six months ended June 30,2023,compared with total other expen

79、ses of RMB56.1 million in the same period of 2022.The change was primarily attributable to a gain of RMB181.2 million on fair value change in investments in publicly traded companies for the six months ended June 30,2023,compared to a loss of RMB335.9 million on fair value change in investments in p

80、ublicly traded companies for the same period of 2022.INCOME TAXIncome tax expense was RMB55.6 million for the six months ended June 30,2023,compared with RMB56.6 million for the six months ended June 30,2022.NET LOSSNet loss was RMB2.2 billion for the six months ended June 30,2023,narrowing by 49%fr

81、om RMB4.3 billion for the six months ended June 30,2022.LIQUIDITYOur cash and cash equivalents,time deposits and short-term investments decreased by 27%from RMB19.6 billion as of December 31,2022 to RMB14.3 billion as of June 30,2023.The decrease was primarily due to the repurchase of 2027 Notes for

82、 a total cash consideration of US$745.9 million(RMB5.3 billion)during the six months ended June 30,2023.SIGNIFICANT INVESTMENTSThe Group did not make or hold any significant investments during the six months ended June 30,2023.MATERIAL ACQUISITIONS AND DISPOSALSThe Group did not have any material ac

83、quisitions or disposals of subsidiaries,consolidated affiliated entities or associated companies during the six months ended June 30,2023.PLEDGE OF ASSETSAs at June 30,2023,none of our assets were pledged to secure loans and banking facilities.15Bilibili Inc.2023 Interim Report Management Discussion

84、 and Analysis GEARING RATIOAs at June 30,2023,the Companys gearing ratio(i.e.total liabilities divided by total assets,in percentage)was 52.6%,compared with 63.6%as at December 31,2022.FUTURE PLANS FOR MATERIAL INVESTMENTS OR CAPITAL ASSETSAs at June 30,2023,the Group did not have detailed future pl

85、ans for material investments or capital assets.FOREIGN EXCHANGE EXPOSUREA substantial majority of our revenues and costs is denominated in Renminbi.Any significant depreciation of the Renminbi may materially adversely affect the value of,and any dividends payable on,the ADSs in U.S.dollars.For examp

86、le,when we convert our U.S.dollars denominated funds into Renminbi for our operations,appreciation of the Renminbi against the U.S.dollar would have an adverse effect on the Renminbi amount we would receive from the conversion.Conversely,if we decide to convert our Renminbi into U.S.dollars for the

87、purpose of making payments for dividends on our ordinary shares or ADSs or for other business purposes,appreciation of the U.S.dollar against the Renminbi would have a negative effect on the U.S.dollar amount available to us.In addition,appreciation or depreciation in the value of the Renminbi relat

88、ive to U.S.dollars would affect our financial results reported in U.S.dollar terms regardless of any underlying change in our business or results of operations.Very limited hedging options are available in China to reduce our exposure to exchange rate fluctuations.To date,we have not entered into an

89、y hedging transactions in an effort to reduce our exposure to foreign currency exchange risk.While we may decide to enter into hedging transactions in the future,the availability and effectiveness of these hedges may be limited and we may not be able to adequately hedge our exposure or at all.In add

90、ition,our currency exchange losses may be magnified by PRC exchange control regulations that restrict our ability to convert Renminbi into foreign currency.CONTINGENT LIABILITIESThe Company had no material contingent liabilities as at June 30,2023.EMPLOYEES AND REMUNERATIONAs of June 30,2023,we had

91、a total of 10,354 employees,compared to 11,092 as of December 31,2022.As required under PRC regulations,the Company participates in housing funds and various employee social security plans that are organized by applicable local municipal and provincial governments,including housing funds,pension,mat

92、ernity,medical,work-related injury and unemployment benefit plans,under which we make contributions at specified percentages of the salaries of its employees.We also purchase commercial health and accidental insurance for our employees.Bonuses are generally discretionary and based in part on employe

93、e performance and in part on the overall performance of the Groups business.The Company has granted and plans to continue to grant share-based incentive awards to its employees in the future to incentivize their contributions to its growth and development.16Bilibili Inc.2023 Interim Report Corporate

94、 GovernanceWEIGHTED VOTING RIGHTSThe Company is controlled through weighted voting rights.Under the Companys weighted voting rights structure,each Class Y Ordinary Share entitles the holder to exercise ten votes and each Class Z Ordinary Share entitles the holder to exercise one vote on all matters

95、that require a Shareholders vote,subject to Rule 8A.24 of the Listing Rules,that requires Reserved Matters to be voted on a one vote per share basis.The Companys weighted voting rights structure enables Mr.Rui Chen,Ms.Ni Li and Mr.Yi Xu,holders of the Class Y Ordinary Shares(the“WVR Beneficiaries”),

96、to exercise voting control over the Company notwithstanding that the WVR Beneficiaries do not hold a majority economic interest in the share capital of the Company.This allows the Company to benefit from the continued vision and leadership of the WVR Beneficiaries.Shareholders and prospective invest

97、ors are advised to be aware of the potential risks of investing in companies with a weighted voting rights structure,in particular that the interests of the WVR Beneficiaries may not necessarily always be aligned with those of our Shareholders as a whole,and that the WVR Beneficiaries will be in a p

98、osition to exert significant influence over the affairs of the Company and the outcome of Shareholders resolutions,irrespective of how other Shareholders vote.Prospective investors should make the decision to invest in the Company only after due and careful consideration.As at June 30,2023,the WVR B

99、eneficiaries were interested in a total of 83,715,114 Class Y Ordinary Shares,representing a total of 71.9%voting rights in the Company with respect to Shareholders resolutions relating to matters other than the Reserved Matters(excluding 4,169,372 Class Z Ordinary Shares issued and reserved for fut

100、ure issuance upon the exercise or vesting of awards granted under the Companys share incentive plans).Class Y Ordinary Shares may be converted into Class Z Ordinary Shares on a one-to-one ratio.Upon the conversion of the Class Y Ordinary Shares,the Company would redesignate 83,715,114 Class Y Ordina

101、ry Shares and reissue the same number of Class Z Ordinary Shares,representing 20.4%of the issued share capital of the Company as of June 30,2023(excluding 4,169,372 Class Z Ordinary Shares issued and reserved for future issuance upon the exercise or vesting of awards granted under the Companys share

102、 incentive plans).As at June 30,2023,Mr.Rui Chen was interested in,and controlled through Vanship Limited,49,299,006 Class Y Ordinary Shares and 525,525 Class Z Ordinary Shares in the form of ADSs,and 1,902,000 Class Z Ordinary Shares issuable to Mr.Rui Chen upon exercise of options within 60 days a

103、fter June 30,2023,representing 42.4%of the voting rights in the Company.Vanship Limited is controlled by a trust of which Mr.Chen and his family members are the beneficiaries.As at June 30,2023,Ms.Ni Li was interested in,and controlled through Saber Lily Limited,7,200,000 Class Y Ordinary Shares and

104、 908,300 Class Z Ordinary Shares,and 668,000 Class Z Ordinary Shares issuable to Ms.Ni Li upon exercise of options within 60 days after June 30,2023,representing a total of 6.3%of the voting rights in the Company.Saber Lily Limited is controlled by a trust,and Ms.Li and her family members are the tr

105、usts beneficiaries.As at June 30,2023,Mr.Yi Xu was interested in,and controlled through Kami Sama Limited,27,216,108 Class Y Ordinary Shares and 151,100 Class Z Ordinary Shares,and he held 45,000 Class Z Ordinary Shares in the form of ADSs,representing a total of 23.4%of the voting rights in the Com

106、pany.Kami Sama Limited is controlled by a trust,and Mr.Xu and his family members are the trusts beneficiaries.17Bilibili Inc.2023 Interim Report Corporate GovernanceThe weighted voting rights attached to the Class Y Ordinary Shares will cease when none of the WVR Beneficiaries have beneficial owners

107、hip of any of the Class Y Ordinary Shares,in accordance with Rule 8A.22 of the Listing Rules.This may occur:(i)upon the occurrence of any of the circumstances set out in Rule 8A.17 of the Listing Rules,in particular where a WVR Beneficiary is:(1)deceased;(2)no longer a member of our Board;(3)deemed

108、by the Stock Exchange to be incapacitated for the purpose of performing his duties as a director;or(4)deemed by the Stock Exchange to no longer meet the requirements of a director set out in the Listing Rules;(ii)when a WVR Beneficiary has transferred to another person the beneficial ownership of,or

109、 economic interest in,all of the Class Y Ordinary Shares or the voting rights attached to them,other than in the circumstances permitted by Rule 8A.18 of the Listing Rules;(iii)where a vehicle holding Class Y Ordinary Shares on behalf of a WVR Beneficiary no longer complies with Rule 8A.18(2)of the

110、Listing Rules;or(iv)when all of the Class Y Ordinary Shares have been converted to Class Z Ordinary Shares.The Company confirms that it has,during the Reporting Period,complied with the Corporate Governance Code set out in Appendix 14 to the Listing Rules to the extent required by Chapter 8A of the

111、Listing Rules.COMPLIANCE WITH THE CORPORATE GOVERNANCE CODEThe Board is committed to achieving high corporate governance standards.The Board believes that high corporate governance standards are essential in providing a framework for the Company to safeguard the interests of Shareholders and to enha

112、nce corporate value and accountability.During the Reporting Period,we have complied with all the code provisions of the Corporate Governance Code set forth in Part 2 of Appendix 14 to the Listing Rules,save for the following.Code provision C.2.1 of the Corporate Governance Code,recommends,but does n

113、ot require,that the roles of chairperson and chief executive officer should be separate and should not be performed by the same person.The Company deviates from this code provision because Mr.Rui Chen performs both the roles of the chairperson of the Board and the chief executive officer of the Comp

114、any.Mr.Chen has extensive experience in our business operations and management.The Board believes that vesting the roles of both chairman and chief executive officer to Mr.Chen has the benefit of ensuring consistent leadership within the Company and enables more effective and efficient overall strat

115、egic planning.This structure will enable the Company to make and implement decisions promptly and effectively.18Bilibili Inc.2023 Interim Report Corporate GovernanceThe Board considers that the balance of power and authority will not be impaired due to this arrangement.In addition,all major decision

116、s are made in consultation with members of the Board,including the relevant Board committees,and four independent non-executive Directors.The Board will reassess the division of the roles of chairman and the chief executive officer from time to time,and may recommend dividing the two roles between d

117、ifferent people in the future,taking into account our circumstances as a whole.Code provision F.1.1 of the Corporate Governance Code provides that an issuer should have a policy on payment of dividends and should disclose it in the annual report.The Company deviates from this code provision because

118、the Company does not have a dividend policy.The Board has complete discretion on whether to distribute dividends,subject to certain requirements of Cayman Islands law.Even if the Board decides to pay dividends,the form,frequency and amount will depend upon our future operations and earnings,capital

119、requirements and surplus,general financial condition,contractual restrictions and other factors that the board of directors may deem relevant.We do not have any present plan to pay any cash dividends on our ordinary shares in the foreseeable future.We currently intend to retain most,if not all,of ou

120、r available funds and any future earnings to operate and expand our business.COMPLIANCE WITH THE MODEL CODE FOR SECURITIES TRANSACTIONS BY DIRECTORSThe Company has adopted the Code,with terms no less exacting than that of the Model Code for Securities Transactions by Directors of Listed Issuers as s

121、et out in Appendix 10 to the Listing Rules,as its own securities dealing code to regulate all dealings by Directors and relevant employees of securities in the Company and other matters covered by the Code.Specific enquiry has been made of all the Directors and the relevant employees and they have c

122、onfirmed that they have complied with the Code during the Reporting Period and up to the Latest Practicable Date.AUDIT COMMITTEEThe Audit Committee consists of Mr.Eric He,Mr.JP Gan and Mr.Feng Li.Mr.Eric He is the chairman of our Audit Committee.The Company have determined that Mr.Eric He,Mr.JP Gan

123、and Mr.Feng Li each satisfies the“independence”requirements of Rule 5605(c)(2)of the Nasdaq Stock Market Rules and meet the independence standards under Rule 10A-3 under the Exchange Act,as amended.We have determined that Mr.Eric He qualifies as an“Audit Committee financial expert.”The Audit Committ

124、ee oversees our accounting and financial reporting processes and the audits of the financial statements of our company.The Audit Committee is responsible for,among other things:appointing the independent registered public accounting firms and pre-approving all auditing and non-auditing services perm

125、itted to be performed by the independent registered public accounting firms;reviewing with the independent registered public accounting firms any audit problems or difficulties and managements response;19Bilibili Inc.2023 Interim Report Corporate Governance discussing the annual audited financial st

126、atements with management and the independent registered public accounting firms;reviewing the adequacy and effectiveness of our accounting and internal control policies and procedures and any steps taken to monitor and control major financial risk exposures;reviewing and approving all proposed relat

127、ed party transactions;meeting separately and periodically with management and the independent registered public accounting firms;and monitoring compliance with our code of business conduct and ethics,including reviewing the adequacy and effectiveness of our procedures to ensure proper compliance.The

128、 Audit Committee has reviewed the unaudited interim results of the Company for the six months ended June 30,2023 and has met with the independent auditor,PricewaterhouseCoopers.The Audit Committee has also discussed matters with respect to the accounting policies and practices adopted by the Company

129、 and internal control and financial reporting matters with senior management members of the Company.In addition,the independent auditor of the Company,PricewaterhouseCoopers,has reviewed our interim financial information for the six months ended June 30,2023 in accordance with International Standard

130、 on Review Engagements 2410“Review of Interim Financial Information Performed by the Independent Auditor of the Entity.”NOMINATING AND CORPORATE GOVERNANCE COMMITTEEThe Companys Nominating and Corporate Governance Committee complies with Rules 8A.27,8A.28 and 8A.30 of the Listing Rules.The members o

131、f the Nominating and Corporate Governance Committee are independent non-executive Directors,namely,Mr.JP Gan,Mr.Eric He and Mr.Feng Li.Mr.JP Gan is the chairman of the Nominating and Corporate Governance Committee.The following is a summary of the work performed by the Nominating and Corporate Gover

132、nance Committee during the Reporting Period in respect of its corporate governance functions:Reviewed and monitored whether the Company is operated and managed for the benefits of all its Shareholders;Reviewed the policies and practices of the Company on corporate governance and on compliance with l

133、egal and regulatory requirements;20Bilibili Inc.2023 Interim Report Corporate Governance Reviewed the Companys compliance with the Corporate Governance Code to the extent required by Chapter 8A of the Listing Rules and the Companys disclosure for compliance with Chapter 8A of the Listing Rules;Revie

134、wed and monitored the management of conflicts of interests between the Company and its subsidiaries and consolidated affiliated entities/the Shareholders on one hand and the WVR Beneficiaries on the other;Reviewed and monitored all risks related to the weighted voting rights structure,including any

135、connected transactions between the Company and its subsidiaries and consolidated affiliated entities on one hand and any WVR Beneficiary on the other,and made recommendations to the Board on any such transactions;Reviewed the arrangements for the training and continuous professional development of d

136、irectors and senior management(in particular,Chapter 8A of the Listing Rules and knowledge in relation to the risks relating to the weighted voting rights structure);Reviewed and confirmed that the WVR Beneficiaries have been members of the Board throughout the Reporting Period and that no matters u

137、nder Rule 8A.17 of the Listing Rules have occurred during the Reporting Period,and they have complied with Rules 8A.14,8A.15,8A.18 and 8A.24 of the Listing Rules throughout the Reporting Period;Sought to ensure effective and on-going communication between the Company and its Shareholders,particularl

138、y with regards to the requirements of Rule 8A.35 of the Listing Rules;and Reported on the work of the Nominating and Corporate Governance Committee covering areas of its terms of reference.The Nominating and Corporate Governance Committee recommended the Board to continue the implementation of the c

139、orporate governance measures described above and to periodically review their efficacy.OTHER BOARD COMMITTEESIn addition to the Audit Committee and the Nominating and Corporate Governance Committee,the Board has also established the Compensation Committee.Each of these committees is established with

140、 a defined written charter.The charters of the Board committees are available on the websites of the Companys Investor Relations website and website of the Stock Exchange.21Bilibili Inc.2023 Interim Report Other InformationDisclosure of InterestsDirectors and Chief ExecutivesAs at June 30,2023,the i

141、nterests and short positions of the Directors and chief executives of the Company in the Shares,underlying Shares and debentures of the Company or its associated corporations within the meaning of Part XV of the SFO,which were required(a)to be notified to the Company and the Stock Exchange pursuant

142、to Divisions 7 and 8 of Part XV of the SFO(including interests and short positions which they were taken or deemed to have under such provisions of the SFO);or(b)to be recorded in the register required to be kept by the Company pursuant to Section 352 of the SFO;or(c)as otherwise notified to the Com

143、pany and the Stock Exchange pursuant to the Model Code were as follows:Name of Director or chief executive Nature of interestNumber and class of Shares(5)Approximate%of interest in each class of Shares(1)Mr.Rui Chen(2)Founder of a discretionary trust who can influence how the trustee exercises his d

144、iscretion49,299,006 Class Y Ordinary Shares58.89%Beneficial owner5,000,000 Class Z Ordinary Shares1.53%Founder of a discretionary trust who can influence how the trustee exercises his discretion525,525 Class Z Ordinary Shares 0.16%Ms.Ni Li(3)Founder of a discretionary trust who can influence how the

145、 trustee exercises his discretion7,200,000 Class Y Ordinary Shares8.60%Beneficial owner3,000,000 Class Z Ordinary Shares0.92%Founder of a discretionary trust who can influence how the trustee exercises his discretion908,300 Class Z Ordinary Shares0.28%Mr.Yi Xu(4)Founder of a discretionary trust who

146、can influence how the trustee exercises his discretion27,216,108 Class Y Ordinary Shares32.51%Founder of a discretionary trust who can influence how the trustee exercises his discretion151,100 Class Z Ordinary Shares0.05%Beneficial owner45,000 Class Z Ordinary Shares0.01%Mr.JP GanBeneficial owner170

147、,963 Class Z Ordinary Shares0.05%Founder of a discretionary trust who can influence how the trustee exercises his discretion37,500 Class Z Ordinary Shares0.01%Interest in controlled corporation149,700 Class Z Ordinary Shares0.05%Mr.Eric HeBeneficial owner163,463 Class Z Ordinary Shares0.05%22Bilibil

148、i Inc.2023 Interim Report Other InformationNotes:(1)The calculations are based on a total number of 83,715,114 Class Y Ordinary Shares and 327,376,931 Class Z Ordinary Shares in issue(excluding 4,169,372 Class Z Ordinary Shares issued and reserved for future issuance upon the exercising or vesting o

149、f awards granted under the Companys share incentive plans)as at June 30,2023.(2)Mr.Rui Chen was interested in(i)49,299,006 Class Y Ordinary Shares through Vanship Limited,which is controlled by The Le Petit Prince Trust,a trust of which Mr.Chen is the settlor,and Mr.Chen and his family members are t

150、he beneficiaries;and(ii)5,000,000 Class Z Ordinary Shares underlying options granted and 525,525 Class Z Ordinary Shares in ADSs through Vanship Limited.(3)Ms.Ni Li was interested in(i)7,200,000 Class Y Ordinary Shares through Saber Lily Limited,which is controlled by The Fortuna Trust,a trust of wh

151、ich Ms.Li is the settlor,and Ms.Li and her family members are the beneficiaries;and(ii)3,000,000 Class Z Ordinary Shares underlying options granted and 908,300 Class Z Ordinary Shares through Saber Lily Limited.(4)Mr.Yi Xu was interested in(i)27,216,108 Class Y Ordinary Shares through Kami Sama Limi

152、ted,which is in turn controlled by The Homur Trust,a trust of which Mr.Xu is the settlor,and Mr.Xu and his family members are the beneficiaries;and(ii)151,100 Class Z Ordinary Shares through Kami Sama Limited.The 45,000 Class Z Ordinary Shares are in the form of ADSs.(5)All interests stated are long

153、 positions.Interest in associated corporations上海信樂彼成文化諮詢有限公司Name of Director or chief executiveNature of interestApproximate%of equity interest in associated corporationMr.Rui ChenInterest in controlled corporation12.50%Ms.Ni LiInterest in controlled corporation12.50%上海嗶哩嗶哩電競信息科技有限公司Name of Director

154、 or chief executiveNature of interestApproximate%of equity interest in associated corporationMr.Rui ChenBeneficial owner25.04%Ms.Ni LiBeneficial owner6.87%Mr.Yi XuBeneficial owner3.44%Save as disclosed above,as at June 30,2023,none of the Directors and chief executives of the Company had any interes

155、t or short position in the Shares,underlying Shares or debentures of the Company or any of its associated corporations(within the meaning of Part XV of the SFO)which were required to be notified to the Company and the Stock Exchange pursuant to Divisions 7 and 8 of Part XV of the SFO(including inter

156、ests and short positions which were taken or deemed to have taken under such provisions of the SFO),or which were recorded in the register required to be kept pursuant to section 352 of the SFO,to be entered in the register referred to therein,or which were required,pursuant to the Model Code,to be

157、notified to the Company and the Stock Exchange.23Bilibili Inc.2023 Interim Report Other InformationSubstantial ShareholdersAs at June 30,2023,the following persons(other than the Directors and chief executives whose interests have been separately disclosed in this interim report)had an interest or s

158、hort position in the Shares and underlying Shares which would fall to be disclosed to the Company pursuant to Divisions 2 and 3 of Part XV of the SFO or as recorded in the register required to be kept by the Company pursuant to Section 336 of the SFO.Name of substantial ShareholderCapacity/Nature of

159、 interestNumber of SharesApproximate%of interest in each class of SharesClass Y Ordinary SharesVanship Limited(3)Beneficial owner49,299,006(8)58.89%(1)Kami Sama Limited(4)Beneficial owner27,216,108(8)32.51%(1)Saber Lily Limited(5)Beneficial owner7,200,000(8)8.60%(1)Class Z Ordinary SharesTencent(6)I

160、nterest of controlled corporation43,749,518(8)13.20%(2)Tencent Mobility Limited(6)Beneficial owner32,795,161(8)9.89%(2)Alibaba Group Holding Limited(7)Interest of controlled corporation30,845,657(8)9.42%(1)Taobao China Holding Limited(7)Beneficial owner30,845,657(8)9.42%(1)Taobao Holding Limited(7)I

161、nterest of controlled corporation30,845,657(8)9.42%(1)Notes:(1)The calculations are based on a total number of 83,715,114 Class Y Ordinary Shares and 327,376,931 Class Z Ordinary Shares in issue(excluding 4,169,372 Class Z Ordinary Shares issued and reserved for future issuance upon the exercising o

162、r vesting of awards granted under the Companys share incentive plans)as at June 30,2023.(2)The calculations are based on a total number of 83,715,114 Class Y Ordinary Shares and 331,546,303 Class Z Ordinary Shares in issue(including 4,169,372 Class Z Ordinary Shares issued and reserved for future is

163、suance upon the exercising or vesting of awards granted under the Companys share incentive plans)as at June 30,2023.(3)Mr.Rui Chen was interested in 49,299,006 Class Y Ordinary Shares through Vanship Limited,which is controlled by The Le Petit Prince Trust,a trust of which Mr.Chen is the settlor,and

164、 Mr.Chen and his family members are the beneficiaries.(4)Mr.Yi Xu was interested in 27,216,108 Class Y Ordinary Shares through Kami Sama Limited,which is in turn controlled by The Homur Trust,a trust of which Mr.Xu is the settlor,and Mr.Xu and his family members are the beneficiaries.(5)Ms.Ni Li was

165、 interested in 7,200,000 Class Y Ordinary Shares through Saber Lily Limited,which is controlled by The Fortuna Trust,a trust of which Ms.Li is the settlor,and Ms.Li and her family members are the beneficiaries.(6)Tencent Mobility Limited was interested in 32,795,161 Class Z Ordinary Shares as benefi

166、cial owner,which includes a derivative interest in 6,500,000 Class Z Ordinary Shares representing 6,500,000 ADSs.Tencent Mobility Limited is wholly owned by Tencent.10,954,357 Class Z Ordinary Shares were held by OPH B Limited,which is wholly owned by Oriental Power Holdings Limited,which is in turn

167、 wholly owned by Tencent.(7)30,845,657 Class Z Ordinary Shares were held by Taobao China Holding Limited,which is wholly owned by Taobao Holding Limited,which is in turn wholly owned by Alibaba Group Holding Limited.(8)Interests stated are long position.24Bilibili Inc.2023 Interim Report Other Infor

168、mationName of substantial ShareholderCapacity/Nature of interestNumber of SharesApproximate%of interest in each class of SharesJPMorgan Chase&Co.(9)Interest of controlled corporation12,327,268(8)11,470,302(Short position)3.72%(2)3.46%(2)Investment manager184,926(8)0.06%(2)Person having a security in

169、terest in shares5,559,593(8)1.68%(2)Approved lending agent6,983,746(8)2.11%(2)Brown Brothers Harriman&Co.(10)Approved lending agent19,560,388(8)5.97%(1)Notes:(9)JPMorgan Chase&Co.was interested in an aggregated 25,055,533 Class Z Ordinary Shares(long position),11,470,302 Class Z Ordinary Shares(shor

170、t position)and 6,983,746 Class Z Ordinary Shares(lending pool)in the Company.According to the disclosure of interest notice filed by JPMorgan Chase&Co.regarding the relevant event dated June 9,2023,such Class Z Ordinary Shares are held by JPMorgan Chase&Co.indirectly through certain of its subsidiar

171、ies.Among them,461,900 Class Z Ordinary Shares(long position)and 33,200 Class Z Ordinary Shares(short position)were held through physically settled listed derivatives,3,670 Class Z Ordinary Shares(long position)and 88,446 Class Z Ordinary Shares(short position)were held through cash settled listed d

172、erivatives,674,344 Class Z Ordinary Shares(short position)were held through physically settled unlisted derivatives,3,046,042 Class Z Ordinary Shares(long position)and 424,495 Class Z Ordinary Shares(short position)were held through cash settled unlisted derivatives,and 4,182,601 Class Z Ordinary Sh

173、ares(long position)and 53,073 Class Z Ordinary Shares(short position)were held through a listed derivatives which are convertible instruments.(10)Brown Brothers Harriman&Co.was deemed to be interested in an aggregated 19,560,388 Class Z Ordinary Shares(long position)and 19,560,388 Class Z Ordinary S

174、hares(lending pool)in the Company.Save as disclosed above,as at June 30,2023,to the best knowledge of the Directors,no person(other than the Directors and chief executives of the Company)had an interest or short position in the Shares or underlying Shares which fall to be disclosed to the Company pu

175、rsuant to Divisions 2 and 3 of Part XV of the SFO as recorded in the register required to be kept by the Company pursuant to section 336 of the SFO.Share SchemesThe Company has two share schemes,namely the Global Share Plan(terminated on the Primary Conversion Effective Date)and the 2018 Share Incen

176、tive Plan.From January 1,2023,the Company has relied on the transitional arrangements provided for the existing share schemes and has complied,and will continue to,with the new Chapter 17 accordingly(effective from January 1,2023).Please refer to the annual report of the Company for the year ended D

177、ecember 31,2022 for a summary of the key terms of each share scheme.The tables below set out the details of the outstanding options and awards under each share scheme during the Reporting Period.6,150,725 Class Z Ordinary Shares,representing approximately 1.5%of the weighted average of issued share

178、capital of the Company,may be issued in respect of all options and awards granted during the Reporting Period to eligible participants pursuant to the 2018 Share Incentive Plan.25Bilibili Inc.2023 Interim Report Other InformationGlobal Share PlanAs the Global Share Plan was terminated on the Primary

179、 Conversion Effective Date,no Class Z Ordinary Shares were available for grant under the Global Share Plan as at January 1,2023 and June 30,2023,respectively.The awards previously granted and outstanding and the evidencing original award agreements shall survive the termination of the Global Share P

180、lan and remain effective until the expiration of their original terms,as may be amended from time to time.Details of the outstanding options of the Global Share Plan during the Reporting Period are set out below.Name Date of GrantVestingPeriodExercise PeriodExercisePrice(USD)Number of Class Z Ordina

181、ry Shares underlying options outstandingas atJanuary 1,2023Exercised during the Reporting PeriodLapsed during the Reporting PeriodCancelled during the Reporting PeriodNumber ofClass Z Ordinary Shares underlying options outstandingas atJune 30,2023Weighted average closing price of Class Z Ordinary Sh

182、ares immediately beforedate(s)of exerciseDirectorsMr.JP GanMarch 20,20203 years6 years$0.000112,50012,500Other grantees by categoryEmployee ParticipantsFrom June 10,2017 to March 20,20204 years6 years$0.0001 1,059,150443,97523,250591,925HKD171.6Notes:(1)No further options would be granted under the

183、Global Share Plan after the Primary Conversion.(2)No options were granted under the Global Share Plan during the Reporting Period.2018 Share Incentive PlanThe maximum aggregate number of Class Z Ordinary Shares which may be issued pursuant to all awards is 30,673,710,which is 10%of the total number

184、of issued Class Z Ordinary Shares as at the Primary Conversion Effective Date(excluding Class Z Ordinary Shares underlying awards which have terminated,expired,lapsed or have been forfeited in accordance with the rules of the 2018 Share Incentive Plan).As at January 1,2023,28,706,326 Class Z Ordinar

185、y Shares were available for grant under the 2018 Share Incentive Plan.During the Reporting Period,6,150,725 Class Z Ordinary Shares underlying awards were granted to eligible participants pursuant to the 2018 Share Incentive Plan and 1,034,125 Class Z Ordinary Shares underlying awards were terminate

186、d,expired,lapsed or have been forfeited,respectively.It follows that,as at June 30,2023,22,555,601 Class Z Ordinary Shares were available for grant under the 2018 Share Incentive Plan.26Bilibili Inc.2023 Interim Report Other InformationDetails of the outstanding options under the 2018 Share Incentiv

187、e Plan are as follows:Name Date of GrantVesting PeriodExercise PeriodExercise Price(USD)Number of Class Z Ordinary Shares underlying options outstanding as at January 1,2023Exercised during the Reporting PeriodLapsed during the Reporting PeriodCancelled during the Reporting PeriodNumber of Class Z O

188、rdinary Shares underlying options outstanding as at June 30,2023Weighted average closing price of Class Z Ordinary Shares immediately before date(s)of exerciseDirectorsMr.Rui ChenFrom March 23,2020 to November 23,20206 years7 years$0.0001$20.265,000,0005,000,000Ms.Ni LiNovember 23,20206 years7 years

189、$0.00012,000,0002,000,000Mr.JP GanJuly 1,20223 years6 years$0.000113,46313,463Mr.Eric HeJuly 1,20223 years6 years$0.000113,46313,463Other grantees by categoryConsultants(2)From April 20,2021 to September 15,202214 years6 years$0.0001156,071156,071Employee ParticipantsFrom April 2,2018 to September 1

190、5,202206 years67 years$0.0001$20.26 13,655,781711,985757,38812,186,408HKD154.1Notes:(1)No further options would be granted under the 2018 Share Incentive Plan after the Primary Conversion.(2)Consultants mean service providers,other than employees.27Bilibili Inc.2023 Interim Report Other InformationD

191、etails of the unvested restricted share units granted under the 2018 Share Incentive Plan(to be satisfied by Class Z Ordinary Shares)are as follows:NameDate of GrantVesting PeriodPurchase PriceUnvested restricted share units as at January 1,2023Granted during the Reporting PeriodVested during the Re

192、porting PeriodLapsed during the Reporting PeriodCancelled during the Reporting PeriodUnvested restricted share units as at June 30,2023Weighted average closing price of Class Z Ordinary Shares immediately before date(s)of vestingDirectorsMs.Ni LiMarch 31,20236 years$01,000,0001,000,000Other grantees

193、 by categoryConsultants(1)December 14,202202 years$035,00012,50022,500HKD186.8Employee ParticipantsFrom December 14,2022 to June 30,202346 years$01,932,3845,150,725276,7376,806,372Notes:(1)Consultants mean service providers,other than employees.Further details of the unvested restricted share units

194、granted under the 2018 Share Incentive Plan during the Reporting Period(to be satisfied by Class Z Ordinary Shares)are as follows:NameNumber ofrestricted share units granted during the Reporting PeriodDate of grantVesting periodPurchase price Performance TargetsClosing price of Class Z Ordinary Shar

195、es immediately before the date of grant(HKD)Fair value of Class Z Ordinary Shares at the date of grant(RMB in thousands)(1)DirectorsMs.Ni Li1,000,000March 31,20236 years$0None191.3161,485Other grantees by categoryEmployee Participants5,150,725March 31,2023 and June 30,202346 years$0None191.3 and 117

196、.4744,679Notes:(1)The fair values of the restricted share units are calculated in accordance with the accounting standards and policies adopted for preparing the Companys financial statements.The Group recognizes the compensation cost,net of estimated forfeitures,over a vesting term for service-base

197、d RSUs.(2)For further details of the restricted share units granted under the 2018 Share Incentive Plan during the Reporting Period,please refer to the announcements of the Company dated March 31,2023 and June 30,2023.28Bilibili Inc.2023 Interim Report Other InformationUse of ProceedsUse of proceeds

198、 from the Global OfferingThe net proceeds received by the Company from the Global Offering were approximately HK$22.9 billion(RMB19.3 billion)after deducting underwriting expenses and other offering expenses.There has been no change in the intended use of net proceeds as previously disclosed in the

199、Prospectus and the Company expects to fully utilize the residual amount of the net proceeds in accordance with such intended purposes within three years.As at June 30,2023,the Group had utilized the net proceeds as set out in the table below:Purpose%of use of proceedsNet proceeds Unutilized amount a

200、s at January 1,2023Utilized for the Reporting Period Unutilized amount as at June 30,2023(HK$million)(HK$million)(HK$million)(HK$million)Our content to support our healthy and high-quality user growth,ever-growing content ecosystem and development of our community50%11,451.86,625.31,382.25,243.1Rese

201、arch and development to improve our user experience and strengthen our user-centric commercialization capabilities20%4,580.7 1,464.8730.5734.3Sales and marketing,primarily to fuel our user growth and to raise our brand awareness20%4,580.72,250.5880.01,370.5General corporate purposes and working capi

202、tal needs10%2,290.31,848.5442.91,405.6Total100%22,903.512,189.13,435.68,753.5Note:(1)The above figures expressed in HK$are based on an exchange note of RMB1.00 to HK$1.0846.29Bilibili Inc.2023 Interim Report Other InformationUse of proceeds from the issuance of Class Z Ordinary Shares under general

203、mandateOn January 9,2023(U.S.Eastern Time),the Company and Goldman Sachs(Asia)L.L.C.(the“Underwriter”)entered into an equity underwriting and notes exchange agreement,pursuant to which the Company agreed to issue 15,344,000 ADSs partially in exchange for an aggregate principal amount of US$384.8 mil

204、lion of its outstanding December 2026 Notes to be purchased by the Underwriter and its applicable affiliate(s)from certain holders of the December 2026 Notes through private negotiations(the“Exchange Notes”).Concurrently with the ADS Offering,the Underwriter and its applicable affiliate(s),as duly e

205、ngaged and authorized by the Company,entered into separate agreements with certain holders of the December 2026 Notes to purchase the Exchange Notes from such holders for a purchase price of approximately US$331.2 million.The closing price per ADS on the Nasdaq on January 6,2023,being the previous t

206、rading day prior to the date of the equity underwriting and notes exchange agreement,was US$28.65 and the closing price per Class Z Ordinary Share on the Stock Exchange on January 9,2023 was HK$224.00.An aggregate of 15,344,000 ADSs(representing 15,344,000 Class Z Ordinary Shares with an aggregate n

207、ominal value of approximately US$1,534.4)were successfully placed by the Underwriter to not fewer than six placees at the offer price of US$26.65 per ADS.Such placees professional,institutional or other investors whom the Underwriter has selected and procured to subscribe for any of the ADSs pursuan

208、t to the equity underwriting and notes exchange agreement.The net price per Class Z Ordinary Share underlying the ADSs subject to the ADS Offering was approximately US$25.87 and such Class Z Ordinary Shares were issued under the general mandate granted to the Directors pursuant to resolutions of the

209、 Shareholders passed on June 30,2022 to allot,issue or deal with unissued Class Z Ordinary Shares and/or ADSs not exceeding 20%of the total number of issued Shares of the Company as of the date of passing of such ordinary resolution.The amount of net proceeds from the ADS Offering(after deducting th

210、e selling commission)is approximately US$399.9 million and the amount of net proceeds from the ADS Offering(after deducting all applicable costs and expenses including but not limited to selling commission)is approximately US$396.9 million.The net proceeds of the ADS Offering(after deducting the sel

211、ling commission)would be used,as a part of the Companys comprehensive liability management exercise(i)by the Underwriter to fund the purchase price of the Exchange Notes of approximately US$331.2 million payable by the Underwriter to the holders of such Exchange Notes,and(ii)in respect of the remain

212、ing proceeds in the amount of US$68.8 million to be paid by the Underwriter to the Company,by the Company,to replenish its cash reserve after its repurchases of certain convertible senior notes in the fourth quarter of 2022 and for its other working capital purpose.As at June 30,2023,none of the net

213、 proceeds from the ADS Offering had been utilized.The Company intends to utilize the remaining proceeds as disclosed above in two years.Further details of the ADS Offering and purchase of the Exchange Notes are set out in the announcements of the Company dated January 9,2023 and January 12,2023.30Bi

214、libili Inc.2023 Interim Report Other InformationDisclosure of Changes in Directors Information pursuant to Listing Rule 13.51B(1)There is no change to the information of the Directors which is required to be disclosed pursuant to Rule 13.51B(1)of the Listing Rules.Purchase,Sale or Redemption of the

215、Companys Listed SecuritiesAs disclosed in this interim report,the Company repurchased December 2026 Notes and 2027 Notes during the Reporting Period.Further details of the repurchase of December 2026 Notes are set out in the announcements of the Company dated January 9,2023 and January 12,2023.And f

216、urther details of the repurchase of 2027 Notes are set out in the overseas regulatory announcements dated May 9,2023 and June 14,2023,as well as the next day disclosure return dated June 16,2023 and the monthly return dated July 7,2023 of the Company.In addition,the Company announced in March 2022 t

217、hat its Board of Directors had authorized a share repurchase program,under which the Company may repurchase up to US$500 million of its ADSs for the next 24 months.The Company had repurchased a total of 2.6 million ADSs for a total cost of US$53.6 million as of June 30,2023.The aforementioned repurc

218、hases of ADSs took place between March and May 2022 prior to the Reporting Period.Save as disclosed in this interim report,neither the Company nor any of its subsidiaries and consolidated affiliated entities had purchased,sold or redeemed any of the Companys listed securities during the Reporting Pe

219、riod.DividendThe Board did not recommend the distribution of an interim dividend for the six months ended June 30,2023.Continuing Disclosure Obligations pursuant to the Listing RulesThe Company does not have any disclosure obligations under Rules 13.20,13.21 and 13.22 of the Listing Rules.31Bilibili

220、 Inc.2023 Interim Report Report on Review of Interim Financial InformationTo the Board of Directors of Bilibili Inc.(incorporated in the Cayman Islands with limited liability)INTRODUCTIONWe have reviewed the interim financial information set out on pages 33 to 76,which comprises the interim condense

221、d consolidated balance sheet of Bilibili Inc.(the“Company”)and its subsidiaries,variable interest entities(“VIEs”)and subsidiaries of the VIEs(together,the“Group”)as at 30 June 2023 and the interim condensed consolidated statement of operations and comprehensive loss,the interim condensed consolidat

222、ed statement of changes in shareholders equity and the interim condensed consolidated statement of cash flows for the six-month period then ended,and notes,comprising significant accounting policies and other explanatory information.The Rules Governing the Listing of Securities on The Stock Exchange

223、 of Hong Kong Limited require the preparation of a report on interim financial information to be in compliance with the relevant provisions thereof and accounting principles generally accepted in the United States of America(“U.S.GAAP”).The directors of the Company are responsible for the preparatio

224、n and presentation of this interim financial information in accordance with U.S.GAAP.Our responsibility is to express a conclusion on this interim financial information based on our review and to report our conclusion solely to you,as a body,in accordance with our agreed terms of engagement,and for

225、no other purpose.We do not assume responsibility towards or accept liability to any other person for the contents of this report.SCOPE OF REVIEWWe conducted our review in accordance with International Standard on Review Engagements 2410,“Review of Interim Financial Information Performed by the Indep

226、endent Auditor of the Entity”.A review of interim financial information consists of making inquiries,primarily of persons responsible for financial and accounting matters,and applying analytical and other review procedures.A review is substantially less in scope than an audit conducted in accordance

227、 with International Standards on Auditing and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit.Accordingly,we do not express an audit opinion.CONCLUSIONBased on our review,nothing has come to our attention

228、that causes us to believe that the interim financial information of the Group is not prepared,in all material respects,in accordance with U.S.GAAP.32Bilibili Inc.2023 Interim Report Report on Review of Interim Financial InformationOTHER MATTERThe comparative information for the interim condensed con

229、solidated balance sheet is based on the audited financial statements as at 31 December 2022.The comparative information for the interim condensed consolidated statements of operations and comprehensive loss,changes in shareholders equity and cash flows,and related explanatory notes,for the period en

230、ded 30 June 2022 has not been audited or reviewed.PricewaterhouseCoopersCertified Public AccountantsHong Kong,17 August 202333Bilibili Inc.2023 Interim Report Unaudited Interim Condensed Consolidated Balance Sheet(All amounts in thousands,except for share data)December 31,June 30,June 30,20222023202

231、3RMBRMB US$NotesNote 2(d)AssetsCurrent assets:Cash and cash equivalents10,172,5845,686,852 784,253 Time deposits4,767,9725,712,014 787,723 Restricted cash14,803167,81023,142 Accounts receivable,net41,328,5841,367,815 188,630 Amount due from related parties191,594,9201,207,285 166,492 Prepayments and

232、 other current assets51,950,5731,669,096230,179 Short-term investments64,623,4522,899,822 399,904 Total current assets24,452,88818,710,694 2,580,323Non-current assets:Property and equipment,net71,227,163929,803 128,226 Production cost,net1,929,6222,014,100 277,757 Intangible assets,net84,326,7903,95

233、2,713 545,104 Deferred tax assets43,59143,591 6,011 Goodwill2,725,1302,725,130 375,813 Long-term investments,net95,651,0185,223,492 720,352 Other long-term assets1,474,368 1,295,834 178,704 Total non-current assets17,377,68216,184,663 2,231,967Total assets41,830,57034,895,357 4,812,29034Bilibili Inc

234、.2023 Interim Report Unaudited Interim Condensed Consolidated Balance Sheet(All amounts in thousands,except for share data)December 31,June 30,June 30,202220232023RMBRMB US$NotesNote 2(d)LiabilitiesCurrent liabilities:Accounts payable114,291,6564,171,625 575,293 Salary and welfare payable1,401,52699

235、4,074 137,089 Taxes payable12316,244300,330 41,417 Short-term loan and current portion of long-term debt136,621,3864,611,656 635,976 Deferred revenue2,819,3232,690,964 371,101 Accrued liabilities and other payables 141,534,9621,609,350 221,940 Amount due to related parties 19108,307101,458 13,992 To

236、tal current liabilities17,093,40414,479,457 1,996,808Non-current liabilities:Long-term debt158,683,1503,197,625 440,973 Other long-term liabilities814,429685,593 94,549 Total non-current liabilities9,497,5793,883,218 535,522Total liabilities26,590,98318,362,675 2,532,33035Bilibili Inc.2023 Interim R

237、eport Unaudited Interim Condensed Consolidated Balance Sheet(All amounts in thousands,except for share data)December 31,June 30,June 30,202220232023RMBRMB US$NotesNote 2(d)Shareholders equity Ordinary shares:Class Y Ordinary Shares(US$0.0001 par value;100,000,000 shares authorized,83,715,114 shares

238、issued and outstanding as of December 31,2022;US$0.0001 par value;100,000,000 shares authorized,83,715,114 shares issued and outstanding as of June 30,2023)5252 7 Class Z Ordinary Shares(US$0.0001 par value;9,800,000,000 shares authorized,316,202,303 shares issued,310,864,471 shares outstanding as o

239、f December 31,2022;US$0.0001 par value;9,800,000,000 shares authorized,331,546,303 shares issued,327,376,931 shares outstanding as of June 30,2023)201213 29 Additional paid-in capital36,623,16139,874,079 5,498,887 Statutory reserves36,17336,173 4,988 Accumulated other comprehensive income58,110278,0

240、52 38,345 Accumulated deficit(21,479,869)(23,654,262)(3,262,072)Total Bilibili Inc.s shareholders equity15,237,82816,534,307 2,280,184 Noncontrolling interests1,759(1,625)(224)Total shareholders equity15,239,58716,532,682 2,279,960Total liabilities and shareholders equity41,830,57034,895,357 4,812,2

241、90The accompanying notes are an integral part of these unaudited interim condensed consolidated financial statements.36Bilibili Inc.2023 Interim Report Unaudited Interim Condensed Consolidated Statement of Operations and Comprehensive Loss(All amounts in thousands,except for share and per share data

242、)For the Six Months Ended June 30,202220232023RMBRMBUS$NotesNote 2(d)Net revenues Mobile games2,404,0542,022,503 278,916 Value-added services4,155,6504,457,965 614,781 Advertising 2,199,0222,844,644 392,294 IP derivatives and others(formerly known as E-commerce and others)1,204,3041,048,698 144,622T

243、otal net revenues 169,963,03010,373,810 1,430,613Cost of revenues(8,417,504)(8,042,344)(1,109,090)Gross profit 1,545,5262,331,466 321,523Operating expenses:Sales and marketing expenses(2,425,888)(1,798,383)(248,008)General and administrative expenses(1,160,961)(1,111,394)(153,268)Research and develo

244、pment expenses(2,140,551)(2,074,033)(286,022)Total operating expenses(5,727,400)(4,983,810)(687,298)Loss from operations(4,181,874)(2,652,344)(365,775)Other(expense)/income:Investment(loss)/income,net(including impairments)(544,273)8,321 1,148Interest income90,268298,300 41,137Interest expense(123,6

245、12)(105,682)(14,574)Exchange losses(21,526)(16,552)(2,283)Debt extinguishment gain475,790282,44238,951Others,net 67,251 63,328 8,733Total other(expense)/income,net(56,102)530,157 73,112Loss before tax(4,237,976)(2,122,187)(292,663)Income tax 10(56,601)(55,590)(7,666)37Bilibili Inc.2023 Interim Repor

246、t Unaudited Interim Condensed Consolidated Statement of Operations and Comprehensive Loss(All amounts in thousands,except for share and per share data)For the Six Months Ended June 30,202220232023RMBRMBUS$NotesNote 2(d)Net loss(4,294,577)(2,177,777)(300,329)Net loss attributable to:Bilibili Inc.s sh

247、areholders(4,288,909)(2,174,393)(299,862)Noncontrolling interests(5,668)(3,384)(467)Net loss(4,294,577)(2,177,777)(300,329)Other comprehensive income:Foreign currency translation adjustments 334,244219,94230,331Total other comprehensive income 334,244 219,942 30,331Total comprehensive loss(3,960,333

248、)(1,957,835)(269,998)Total comprehensive loss is attributable to:Bilibili Inc.s shareholders(3,954,665)(1,954,451)(269,531)Noncontrolling interests(5,668)(3,384)(467)Total comprehensive loss(3,960,333)(1,957,835)(269,998)Net loss per share,basic18(10.88)(5.28)(0.73)Net loss per share,diluted(10.88)(

249、5.28)(0.73)Net loss per ADS,basic(10.88)(5.28)(0.73)Net loss per ADS,diluted(10.88)(5.28)(0.73)Weighted average number of ordinary shares,basic18394,142,409412,013,005412,013,005Weighted average number of ordinary shares,diluted394,142,409412,013,005412,013,005Weighted average number of ADS,basic394

250、,142,409412,013,005412,013,005Weighted average number of ADS,diluted394,142,409412,013,005412,013,005Share-based compensation expenses included in:Cost of revenues 38,112 29,902 4,124 Sales and marketing expenses25,931 29,166 4,022 General and administrative expenses282,875 291,213 40,160 Research a

251、nd development expenses187,642 211,267 29,135The accompanying notes are an integral part of these unaudited interim condensed consolidated financial statements.38Bilibili Inc.2023 Interim Report Unaudited Interim Condensed Consolidated Statement of Changes in Shareholders Equity(All amounts in thous

252、ands,except for share data)Ordinary sharesClass Y Ordinary SharesClass Z Ordinary SharesAdditional paid-in capitalStatutoryreservesAccumulated other comprehensive(loss)/incomeAccumulateddeficitNoncontrollinginterestsTotalshareholdersequitySharesAmountSharesAmountRMBRMBRMBRMBRMBRMBRMBRMBBalance at De

253、cember 31,202183,715,114 52306,889,473 19935,929,96124,621(279,862)(13,971,304)12,39921,716,066Net loss(4,288,909)(5,668)(4,294,577)Share-based compensation534,560534,560Share issuance from exercise of share options2,443,450 22Repurchase of shares(2,640,832)(2)(347,579)(347,581)Purchase of noncontro

254、lling interests45,000Foreign currency translation adjustment334,244 334,244Balance at June 30,202283,715,114 52306,737,091 19936,116,94224,62154,382(18,260,213)6,73117,942,714The accompanying notes are an integral part of these unaudited interim condensed consolidated financial statements.39Bilibili

255、 Inc.2023 Interim Report Unaudited Interim Condensed Consolidated Statement of Changes in Shareholders Equity(All amounts in thousands,except for share data)Ordinary sharesClass Y Ordinary SharesClass Z Ordinary SharesAdditionalpaid-incapitalStatutoryreservesAccumulated other comprehensive(loss)/inc

256、omeAccumulateddeficitNoncontrollinginterestsTotalshareholdersequitySharesAmountSharesAmountRMBRMBRMBRMBRMBRMBRMBRMBBalance at December 31,202283,715,114 52308,223,639 201 36,623,161 36,173 58,110(21,479,869)1,759 15,239,587Net loss(2,174,393)(3,384)(2,177,777)Share-based compensation561,548561,548Sh

257、are issuance from exercise of share options1,168,460 2 2Issuance of Class Z ordinary shares upon new ADS offering(“ADS offering”)15,344,000102,689,3702,689,380Foreign currency translation adjustment219,942219,942Balance at June 30,202383,715,114 52 324,736,099 213 39,874,079 36,173 278,052(23,654,26

258、2)(1,625)16,532,682The accompanying notes are an integral part of these unaudited interim condensed consolidated financial statements.40Bilibili Inc.2023 Interim Report Unaudited Interim Condensed Consolidated Statement of Cash Flows(All amounts in thousands)For the Six Months Ended June 30,20222023

259、2023RMBRMBUS$Note 2(d)Cash flows from operating activities:Net loss(4,294,577)(2,177,777)(300,329)Adjustments to reconcile net loss to net cash used in operating activities:Depreciation of property and equipment358,358 402,827 55,552 Amortization of intangible assets1,248,729 993,357 136,990 Amortiz

260、ation of right-of-use assets123,022 89,023 12,277 Amortization of debt issuance costs24,04812,3611,705 Share-based compensation expenses534,560 561,548 77,441 Allowance for doubtful accounts80,483 Inventory provision85,348 30,328 4,182 Deferred income taxes(18,009)(11,250)(1,551)Unrealized exchange

261、losses288 1,484 205 Unrealized fair value changes of investments349,314(154,724)(21,337)Loss on disposal of property and equipment255 646 89 Gain on disposal of long-term investments and subsidiaries(19,161)Termination expenses of certain game projects109,054 Loss from equity method investments74,28

262、9 80,391 11,086 Revaluation of previously held equity interests(152,153)75,000 10,343 Impairments of long-term investments99,28069,9499,646 Gain of convertible senior notes repurchase(475,790)(282,442)(38,951)Changes in operating assets and liabilities:Accounts receivable(104,104)(55,833)(7,700)Amou

263、nt due from related parties(63,015)27,693 3,819 Prepayments and other assets(195,501)168,80623,279 Other long-term assets(218,243)162,872 22,461 Accounts payable553,373(113,788)(15,692)Salary and welfare payable(137,284)(407,452)(56,190)Taxes payable52,869(15,914)(2,195)Deferred revenue131,731(128,3

264、59)(17,702)Accrued liabilities and other payables(358,746)143,12819,738 Amount due to related parties3,054(5,446)(751)Other long-term liabilities104,012(117,586)(16,216)Net cash used in operating activities(2,104,516)(651,158)(89,801)41Bilibili Inc.2023 Interim Report Unaudited Interim Condensed Con

265、solidated Statement of Cash Flows(All amounts in thousands)For the Six Months Ended June 30,202220232023RMBRMBUS$Note 2(d)Cash flows from investing activities:Purchase of property and equipment(220,450)(51,521)(7,105)Purchase of intangible assets(852,199)(698,543)(96,333)Purchase of short-term inves

266、tments(52,192,830)(6,682,864)(921,609)Maturities of short-term investments58,166,5128,893,4341,226,461 Cash consideration paid for purchase of subsidiaries,net of cash acquired(1,093,353)(70,000)(9,653)Cash paid for long-term investments including loans(1,276,691)(45,994)(6,343)Repayment of loans fr

267、om investees547,744 275,078 37,935 Cash received from disposal/return of investments124,95482,85611,426 Placements of time deposits(6,934,107)(5,503,040)(758,904)Maturities of time deposits3,082,530 4,810,737 663,431 Net cash(used in)/provided by investing activities(647,890)1,010,143 139,306Cash fl

268、ows from financing activities:Proceeds of short-term loans711,371548,52175,645 Repayment of short-term loans(494,428)(493,624)(68,074)Purchase of noncontrolling interests(56,741)Proceeds from exercise of employees share options22*Proceeds from issuance of ordinary shares net of issuance costs 2,689,

269、380370,882 Repurchase of convertible senior notes(1,268,630)(7,581,959)(1,045,600)Repurchase of shares(347,581)Net cash used in financing activities(1,456,007)(4,837,680)(667,147)Effect of exchange rate changes on cash and cash equivalents and restricted cash held in foreign currencies176,776 145,97

270、020,132Net decrease in cash and cash equivalents and restricted cash(4,031,637)(4,332,725)(597,510)Cash and cash equivalents and restricted cash at beginning of the period7,523,108 10,187,387 1,404,905Cash and cash equivalents and restricted cash at end of the period3,491,471 5,854,662 807,39542Bili

271、bili Inc.2023 Interim Report Unaudited Interim Condensed Consolidated Statement of Cash Flows(All amounts in thousands)For the Six Months Ended June 30,202220232023RMBRMBUS$Note 2(d)Supplemental disclosures of cash flows information:Cash paid for income taxes,net of tax refund58,47084,21011,613Cash

272、paid for interest expense109,91295,92413,229Supplemental schedule of non-cash investing and financing activities:Property and equipment purchases financed by accounts payable465,83687,36412,048Acquisitions and investments financed by payables124,86510,0001,379Intangible assets purchases financed by

273、payables715,244461,62363,661*Less than 1The accompanying notes are an integral part of these unaudited interim condensed consolidated financial statements.43Bilibili Inc.2023 Interim Report Notes to Unaudited Interim Condensed Consolidated Financial Information1.OPERATIONSBilibili Inc.(the“Company”o

274、r“Bilibili”)is an iconic brand and a leading video community for young generations in China.Incorporated as a limited liability company in the Cayman Islands in December 2013,the Company,through its consolidated subsidiaries,variable interest entities(“VIEs”)and subsidiaries of the VIEs(collectively

275、 referred to as the“Group”),is primarily engaged in the operation of providing online entertainment services to users in the Peoples Republic of China(the“PRC”or“China”).In April 2018,the Company completed its IPO on the Nasdaq.In March 2021,the Company successfully listed its Class Z ordinary share

276、s on the main board of the Stock Exchange.The Company issued a total 28,750,000 Class Z ordinary shares in the global offering,including the fully exercised over-allotment option of 3,750,000 Class Z ordinary shares.Net proceeds from the global offering,including the over-allotment option,after dedu

277、cting underwriting fees and other offering expenses,were approximately HKD22.9 billion(RMB19.3 billion).On October 3,2022,the Companys voluntary conversion of its secondary listing status to primary listing on the main board of the Stock Exchange became effective.The Company became a dual-primary li

278、sted company on the main board of the Stock Exchange in Hong Kong and the Nasdaq in the United States.In January 2023,the Company completed the offering of 15,344,000 ADSs at US$26.65 per ADS.The amount of net proceeds from such offering(after deducting all applicable costs and expenses including bu

279、t not limited to selling commission)is approximately US$396.9 million(RMB2,689.4 million).Shortly thereafter,the Company completed repurchase of an aggregate principal amount of US$384.8 million of its outstanding 0.50%convertible senior notes due December 2026 with an aggregate purchase price of US

280、$331.2 million(RMB2,243.8 million),which was funded by the net proceeds from the ADS Offering.44Bilibili Inc.2023 Interim Report Notes to Unaudited Interim Condensed Consolidated Financial Information1.OPERATIONS(Continued)As of June 30,2023,the Companys major subsidiaries,VIEs and subsidiaries of t

281、he VIEs are as follows:Major SubsidiariesPlace and Year of IncorporationIssued Share CapitalPercentage of Direct or Indirect Economic Ownership Principal ActivitiesBilibili HK Limited Hong Kong,2014USD1100 Investment holdingHode HK Limited Hong Kong,2014USD1100 Investment holdingChaodian HK LimitedH

282、ong Kong,2019USD1100 Investment holdingBilibili Co.,Ltd.Japan,2014JPY80 million100 Business developmentHode Shanghai Limited (“Hode Shanghai”)PRC,2014USD1.2 billion100 Technology development1Shanghai Bilibili Technology Co.,Ltd.PRC,2016USD2.5 billion100 Technology development1Chaodian(Shanghai)Techn

283、ology Co.,Ltd.PRC,2019USD50 million100 E-commerce and advertising145Bilibili Inc.2023 Interim Report Notes to Unaudited Interim Condensed Consolidated Financial Information1.OPERATIONS(Continued)Major VIEs and VIEs subsidiariesPlace and Year of IncorporationAcquisitionIssuedShare CapitalPercentage o

284、fDirect or IndirectEconomicInterest Principal ActivitiesShanghai Hode Information Technology Co.,Ltd.(“Hode Information Technology”)PRC,2013RMB11 million100*Mobile game operation2Shanghai Kuanyu Digital Technology Co.,Ltd.(“Shanghai Kuanyu”)PRC,2014RMB500 million100*Video distribution and game distr

285、ibution2Sharejoy Network Technology Co.,Ltd.(“Sharejoy Network”)PRC,2014RMB10 million100*Game distribution2Shanghai Hehehe Culture Communication Co.,Ltd.(“Shanghai Hehehe”)PRC,2014RMB120 million100*Comics distribution2Shanghai Anime Tamashi Cultural Media Co.,Ltd.(“Shanghai Anime Tamashi”)PRC,2015RM

286、B1 million100*E-commerce platform2*Hode Shanghai is the primary beneficiary of the major VIEs and VIEs subsidiaries.1 These companies were established in the PRC in the form of wholly foreign-owned enterprises.2 These companies were established in the PRC in the form of investment solely by legal co

287、rporations or controlled by natural person(s).46Bilibili Inc.2023 Interim Report Notes to Unaudited Interim Condensed Consolidated Financial Information1.OPERATIONS(Continued)The following combined financial information of the Groups VIEs and VIEs subsidiaries as of December 31,2022 and June 30,2023

288、 and for the six months ended June 30,2022 and 2023 included in the accompanying unaudited interim condensed consolidated financial statements of the Group was as follows:December 31,2022June 30,2023RMB in thousandsCash and cash equivalents 1,590,4401,672,130Time deposits 4,1864,355Accounts receivab

289、le,net 619,927589,293Amounts due from Group companies507,849480,920Amount due from related parties 119,8578,823Prepayments and other current assets 883,903722,782Short-term investments 272,340313,867Long-term investments,net 1,852,7401,758,207Other non-current assets 5,852,3155,586,980Total assets 1

290、1,703,55711,137,357Accounts payable 3,452,1923,257,024Salary and welfare payables 343,786250,582Taxes payable 165,162144,158Short-term loans 400,000400,000Deferred revenue 2,138,5391,984,485Accrued liabilities and other payables 531,188554,947Amounts due to the Group companies12,415,76012,864,563Amo

291、unts due to related parties 27,92918,826Other long-term payable 269,623285,522Total liabilities 19,744,17919,760,107Total Bilibili Incs shareholders deficit(8,042,238)(8,621,082)Noncontrolling interests 1,616(1,668)Total shareholders deficit(8,040,622)(8,622,750)Total liabilities and shareholders de

292、ficit11,703,55711,137,35747Bilibili Inc.2023 Interim Report Notes to Unaudited Interim Condensed Consolidated Financial Information1.OPERATIONS(Continued)For the Six Months Ended June 30,20222023RMB in thousandsThird-party revenues 6,933,942 6,717,237Inter-company revenues368,381 477,102Total revenu

293、es7,302,323 7,194,339Net loss(1,914,824)(573,451)For the Six Months Ended June 30,20222023RMB in thousandsNet cash(used in)/provided by operating activities(119,504)208,961Net cash used in investing activities(1,432,746)(119,992)Net cash provided by financing activities1,724,155 9,49848Bilibili Inc.

294、2023 Interim Report Notes to Unaudited Interim Condensed Consolidated Financial Information1.OPERATIONS(Continued)LiquidityThe Group incurred net losses of RMB4,294.6 million and RMB2,177.8 million for the six months ended June 30,2022 and 2023,respectively.Net cash used in operating activities was

295、RMB2,104.5 million and RMB651.2 million for the six months ended June 30,2022 and 2023,respectively.Accumulated deficit was RMB21,479.9 million and RMB23,654.3 million as of December 31,2022 and June 30,2023,respectively.The Group assesses its liquidity by its ability to generate cash from operating

296、 activities and attract investors investments.Historically,the Group has relied principally on both operational sources of cash and non-operational sources of financing from investors to fund its operations and business development.The Groups ability to continue as a going concern is dependent on ma

297、nagements ability to successfully execute its business plan,which includes increasing revenues while controlling operating expenses,as well as,generating operational cash flows and continuing to gain support from outside sources of financing.In the past,the Group has been continuously receiving fina

298、ncing support from outside investors.In January 2023,the Company completed an offering of 15,344,000 American depositary shares(the“ADS Offering”).The amount of net proceeds from the Offering(after deducting all applicable costs and expenses including but not limited to selling commission)is approxi

299、mately US$396.9 million(RMB2,689.4 million).Shortly thereafter,the Company completed repurchase of an aggregate principal amount of US$384.8 million of its outstanding 0.50%convertible senior notes due December 2026 with the aggregate purchase price of US$331.2 million(RMB2,243.8 million),which was

300、funded by the net proceeds from the ADS Offering.And the remaining net proceeds,after deducting selling commissions of the ADS Offering is US$68.8 million.Moreover,the Group can adjust the pace of its operation expansion and control the operating expenses.Based on the above considerations,the Group

301、believes the cash and cash equivalents and the operating cash flows are sufficient to meet the cash requirements to fund planned operations and other commitments for at least the next twelve months from the date of the issuance of the unaudited interim condensed consolidated financial statements.The

302、 Groups unaudited interim condensed consolidated financial statements have been prepared on a going concern basis,which contemplates the realization of assets and liquidation of liabilities in the normal course of business.49Bilibili Inc.2023 Interim Report Notes to Unaudited Interim Condensed Conso

303、lidated Financial Information2.SIGNIFICANT ACCOUNTING POLICIESa)Basis of presentationThe accompanying unaudited interim condensed consolidated financial statements and related disclosures have been prepared in accordance with accounting principles generally accepted in the United States of America(“

304、U.S.GAAP”)applicable to interim financial information and the disclosure requirements of the Rules Governing the Listing of Securities on The HKEx,as amended,supplemented or otherwise modified from time to time(the“HK Listing Rules”).The December 31,2022 balance sheet data was derived from audited c

305、onsolidated financial statements;however,the accompanying interim notes to the unaudited interim condensed consolidated financial information do not include all of the annual disclosures required by U.S.GAAP.Results for interim periods are not necessarily indicative of those that may be expected for

306、 a full year.The financial information included herein should be read in conjunction with the Companys audited consolidated financial statements for the preceding fiscal year.The accounting policies applied are consistent with those of the audited consolidated financial statements for the preceding

307、fiscal year.b)Principles of consolidationThe unaudited interim condensed consolidated financial statements include the financial statements of the Company,its subsidiaries and VIEs(inclusive of the VIEs subsidiaries)for which the Company is the primary beneficiary.Subsidiaries are those entities in

308、which the Company,directly or indirectly,controls more than one half of the voting power,has the power to appoint or remove the majority of the members of the board of directors,or to cast a majority of votes at the meeting of the board of directors,or has the power to govern the financial and opera

309、ting policies of the investee under a statute or agreement among the shareholders or equity holders.A consolidated VIE is an entity in which the Companys subsidiary,through contractual arrangements,has the power to direct the activities that most significantly impact the entitys economic performance

310、,bears the risks of and enjoys the rewards normally associated with ownership of the entity,and therefore the Companys subsidiary is the primary beneficiary of the entity.All transactions and balances among the Company,its subsidiaries and VIEs(inclusive of the VIEs subsidiaries)have been eliminated

311、 upon consolidation.There is no VIE in the Group where the Company or any subsidiary has a variable interest but is not the primary beneficiary.50Bilibili Inc.2023 Interim Report Notes to Unaudited Interim Condensed Consolidated Financial Information2.SIGNIFICANT ACCOUNTING POLICIES(Continued)c)Use

312、of estimatesThe preparation of the Groups unaudited interim condensed consolidated financial statements in conformity with the U.S.GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities,disclosure of contingent liabilities at the balance

313、 sheet date and reported revenues and expenses during the reported periods in the unaudited interim condensed consolidated financial statements and accompanying notes.Significant accounting estimates include,but are not limited to,determination of the average playing period for paying players,and as

314、sessment for the impairment of long-term investments accounted for using the measurement alternative.d)Functional currency and foreign currency translationThe Group uses Renminbi(“RMB”)as its reporting currency.The Company and several of its overseas subsidiaries use US$or their respective local cur

315、rencies as their functional currency.The functional currency of the Groups PRC entities is RMB.In the unaudited interim condensed consolidated financial statements,the financial information of the Company and other entities located outside of the PRC have been translated into RMB.Assets and liabilit

316、ies are translated at the exchange rates on the balance sheet date,equity amounts are translated at historical exchange rates,and revenues,expenses,gains and losses are translated using the average rate for the period.Translation adjustments are reported as foreign currency translation adjustments,a

317、nd are shown as a component of other comprehensive income on the unaudited interim condensed consolidated statement of operations and comprehensive loss.Foreign currency transactions denominated in currencies other than the functional currency are translated into the functional currency using the ex

318、change rates prevailing at the dates of the transactions.Monetary assets and liabilities denominated in foreign currencies are translated into the functional currency using the applicable exchange rates at the balance sheet dates.Net gains and losses resulting from foreign exchange transactions are

319、included in exchange losses on the unaudited interim condensed consolidated statement of operations and comprehensive loss.e)Convenience TranslationTranslations of balances on the unaudited interim condensed consolidated balance sheet,unaudited interim condensed consolidated statement of operations

320、and comprehensive loss and unaudited interim condensed consolidated statement of cash flows from RMB into US$as of and for the six months ended June 30,2023 are solely for the convenience of the reader and were calculated at the rate of US$1.00=RMB7.2513,representing the noon buying rate in The City

321、 of New York for cable transfers of RMB as certified for customs purposes by the Federal Reserve Bank of New York on June 30,2023.No representation is made that the RMB amounts represent or could have been,or could be,converted,realized or settled into US$at that rate on June 30,2023,or at any other

322、 rate.51Bilibili Inc.2023 Interim Report Notes to Unaudited Interim Condensed Consolidated Financial Information2.SIGNIFICANT ACCOUNTING POLICIES(Continued)f)Contract BalancesDue to the generally short-term duration of the relevant contracts,the majority of the performance obligations are satisfied

323、within one year.The amount of revenue recognized that was included in the receipts in advance balance at the beginning of the period was RMB2,284.0 million and RMB2,397.8 million for the six months ended June 30,2022 and 2023,respectively.The Group did not have any arrangement where the performance

324、obligations had already been satisfied in the past period but recognized the corresponding revenue in the current period for the six months ended June 30,2022 and 2023.g)Receivables,netThe following table sets out movements of the allowance against accounts receivable,amount due from related parties

325、 and other receivables recorded in prepayments and other current assets within the scope of ASC Topic 326 as of December 31,2022 and June 30,2023:December 31,2022June 30,2023RMB in thousandsBeginning balance292,473305,535Provisions130,549Write-offs(117,487)(19,727)Ending balance305,535285,80852Bilib

326、ili Inc.2023 Interim Report Notes to Unaudited Interim Condensed Consolidated Financial Information3.CONCENTRATIONS AND RISKSa)Telecommunications service providerThe Group relied on telecommunications service providers and their affiliates for servers and bandwidth services to support its operations

327、 for the six months ended June 30,2022 and 2023 was as follows:For the Six Months Ended June 30,20222023Total number of telecommunications service providers119104Number of service providers providing 10%or more of the Groups servers and bandwidth expenditure32Total percentage of the Groups servers a

328、nd bandwidth expenditure provided by 10%or greater service providers49%24%b)Foreign currency exchange rate riskThe functional currency and the reporting currency of the Company are U.S.dollars and RMB,respectively.The Groups exposure to foreign currency exchange rate risk primarily relates to cash a

329、nd cash equivalents,time deposits,short-term and long-term investments,and convertible senior notes and accounts payable denominated in the U.S.dollars.Most of the Groups revenues,costs and expenses are denominated in RMB,while the convertible senior notes and a portion of cash and cash equivalents,

330、time deposits,short-term and long-term investments,and accounts payable are denominated in U.S.dollars.Any significant fluctuation of RMB against U.S.dollars may materially and adversely affect the Companys cash flows,revenues,earnings and financial positions.53Bilibili Inc.2023 Interim Report Notes

331、 to Unaudited Interim Condensed Consolidated Financial Information3.CONCENTRATIONS AND RISKS(Continued)c)Credit riskThe Groups financial instruments potentially subject to significant concentrations of credit risk primarily consist of cash and cash equivalents,restricted cash,time deposits,accounts

332、receivable,and money market funds(recorded in the short-term investments)and financial products(recorded in the short-term and long-term investments)with variable interest rates referenced to performance of underlying assets issued by commercial banks and other financial institutions.As of December

333、31,2022 and June 30,2023,substantially all of the Groups cash and cash equivalents,restricted cash and time deposits were held in major financial institutions located in the United States of America and China,which management consider being of high credit quality.Accounts receivable is typically unsecured and is primarily derived from revenue earned from mobile game services(mainly relates to remi