We feel now is a pretty good time to analyse Bilibili Inc.'s (NASDAQ:BILI) business as it appears the company may be on the cusp of a considerable accomplishment.   Bilibili Inc. provides online entertainment services for the young generations in the People's Republic of China.    With the latest financial year loss of CN¥4.8b and a trailing-twelve-month loss of CN¥4.9b, the US$5.9b market-cap company amplified its loss by moving further away from its breakeven target.    As path to profitability is the topic on Bilibili's investors mind, we've decided to gauge market sentiment.  We've put together a brief outline of industry analyst expectations for the company, its year of breakeven and its implied growth rate.

Consensus from 36 of the American Entertainment analysts is that Bilibili is on the verge of breakeven.   They anticipate the company to incur a final loss in 2025, before generating positive profits of CN¥970m in 2026.   The company is therefore projected to breakeven around  2 years from today.    What rate will the company have to grow year-on-year in order to breakeven on this date? Using a line of best fit, we calculated an average annual growth rate of 79%,    which is rather optimistic!  Should the business grow at a slower rate, it will become profitable at a later date than expected.  

NasdaqGS:BILI Earnings Per Share Growth June 11th 2024

Given this is a high-level overview, we won't go into details of Bilibili's upcoming projects,  however,  keep in mind  that generally    a high growth rate is not out of the ordinary, particularly when a company is in a period of investment.  

Before we wrap up, there's one aspect worth mentioning.  The company has managed its capital prudently,  with debt making up 36% of equity. This means that it has predominantly funded its operations from equity capital, and its low debt obligation reduces the risk around investing in the loss-making company.    

Next Steps:

There are key fundamentals of Bilibili which are not covered in this article, but we must stress again that this is merely a basic overview. For a more comprehensive look at Bilibili, take a look at Bilibili's company page on Simply Wall St. We've also compiled a list of  important  aspects  you should further examine:

1. Valuation: What is Bilibili worth today? Has the future growth potential already been factored into the price? The intrinsic value infographic in our free research report helps visualize whether Bilibili is currently mispriced by the market.

2. Management Team: An experienced management team on the helm increases our confidence in the business – take a look at who sits on Bilibili's board and the CEO's background.

3. Other High-Performing Stocks: Are there other stocks that provide better prospects with proven track records? Explore our free list of these great stocks here.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.