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Chinese gaming and video company Bilibili (NASDAQ: BILI) had its initial public offering in March and since then has seen its share price climb roughly 30% as of this writing. This performance comes even as the broader Chinese technology sector has seen steep sell-offs in 2018 and the country's government has made regulatory moves that could threaten the platform's outlook.
Shares of the Invesco China Technology ETF, a fund that reflects the Chinese tech sector's performance, are down roughly 29% since Bilibili's IPO, making the gains more noteworthy. The online media company's stock has seen strong performance thanks to encouraging earnings results and optimism about the long-term outlook for gaming and video platforms in China.
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So what
Bilibili priced its stock at $11.50 per share for its market debut on March 29, and shares closed out their first day of trading at $11. Shares continued to trade in that range until the company published its first-quarter results on May 23.
Results for the quarter came in better than expected, with sales climbing 105% year over year to reach $138.4 million, and management pairing the big revenue growth with an encouraging outlook for the second quarter. The strong earnings report pushed the stock up 48.6% in the month, and that momentum continued into June, helping propel shares to a lifetime high of $22.70.
Bilibili stock lost ground from there and sagged in the middle of summer amid a pullback for Chinese tech stocks that was influenced by indications of slowing growth in the country and concerns about the ongoing trade dispute with the U.S. government. Bilibili then revealed on July 31 that the Chinese government had forced it to temporarily remove its app from mobile stores and get rid of content on the platform that did not adhere to the country's decency standards.
Following the temporary shutdown, the company stated that it would double its staff devoted to monitoring content on the platform. Adding more uncertainty to the outlook of the gaming and online content space, mid-August arrived with news that China's government had shut down most of the approval channels for licenses to release new video games amid a restructuring for agencies involved in regulating content.
While August played host to some worrying news, it also saw the company make good on its previous sales target with its second-quarter results. Revenue for the quarter rose 76% year over year to reach $156.1 million. Monthly active users for the quarter reached 85 million, up 30% compared to the prior-year period.