UBS has released a report highlighting Bilibili's (BILI, Financial) promising AI capabilities demonstrated during its Investor Day. The company utilizes large language and visual language models to enhance user behavior understanding, leading to more accurate content recommendations. Bilibili has also integrated AI into its advertising products, which has increased e-commerce ad click-through rates by 14%.
In the medium term, Bilibili plans to expand its AI capabilities to offer intelligent ad placements, providing substantial automation potential for advertisers. UBS forecasts an 18% growth in Bilibili's advertising revenue this year, surpassing the overall industry in Mainland China. The report is optimistic about Bilibili's outlook, citing improvements in its gaming segment and strong advertising momentum. Coupled with China's resilient younger generation's spending habits, these factors support a positive view on the company. UBS maintains a target price of $30 and a "buy" rating for Bilibili.
