In a year marked by economic uncertainties, Weibo Corporation, a key player in China’s social media landscape, reported a nuanced financial performance for the fiscal year ended December 31, 2023. While the company saw a marginal increase in its fourth-quarter revenues, the full-year figures present a complex picture of resilience amid challenges.

For Q4 2023, Weibo’s net revenues amounted to $463.7 million, a 3% increase year-over-year. This growth, albeit modest, is reflective of the company’s efforts to stabilize and grow its advertising and marketing revenues, which also saw a 3% increase, reaching $403.7 million.

The value-added services (VAS) segment recorded a 4% year-over-year growth, underscoring Weibo’s ability to diversify its revenue streams in a competitive market.

However, the fiscal year 2023 painted a more challenging scenario, with Weibo’s net revenues experiencing a 4% decline, totaling $1.76 billion. This dip underscores the broader macroeconomic pressures impacting advertising budgets and consumer spending.

Despite these headwinds, Weibo managed to maintain a 27% operating margin, indicative of its operational efficiencies and cost management efforts.

The announcement of a $200 million special cash dividend reflects Weibo’s confidence in its liquidity and financial health, signaling a commitment to returning value to shareholders despite the prevailing market conditions.

Weibo’s user engagement metrics offer a silver lining, with monthly active users (MAUs) increasing to 598 million by the end of December 2023. This growth, primarily driven by mobile users, highlights Weibo’s continued relevance in China’s digital ecosystem.

However, the broader economic slowdown poses questions about monetization and the potential impact on Weibo’s advertising revenues moving forward.

In reviewing Weibo’s fiscal year 2023, it is clear that the company has navigated a complex landscape with strategic focus and operational discipline.

While the modest growth in Q4 revenues and the expansion of the user base are positive indicators, the overall revenue decline in 2023 points to significant challenges ahead. Weibo’s strategic initiatives, particularly in enhancing user engagement and diversifying revenue sources, will be critical in addressing the economic pressures and maintaining its competitive edge in the dynamic social media market.

Chinese influencer platforms: Weibo, Douyin, Kuaishou, Xiaohongshu

For the fourth quarter, Bilibili reported total net revenues of RMB 6.3 billion ($894.3 million), a modest increase of 3% year-over-year.

This growth reflects the platform’s diversified revenue streams, with significant contributions from advertising and value-added services (VAS). Advertising revenues soared by 28% year-over-year to RMB 1.9 billion ($271.7 million), while VAS revenues increased by 22% to RMB 2.9 billion ($402.4 million).

However, mobile game revenues dipped by 12% year-over-year to RMB 1.0 billion ($141.8 million), primarily due to a high comparison base from the previous year.

The fiscal year 2023 painted a similar picture of resilience and growth, with total net revenues reaching RMB 22.5 billion ($3.2 billion), up by 3% from the previous year.

The growth in advertising and VAS revenues stood out, increasing by 27% and 14% respectively, highlighting Bilibili’s ability to monetize its content effectively. Despite challenges in the mobile gaming sector, which saw a 20% decline in revenues to RMB 4.0 billion ($566.4 million), the company’s broad portfolio of revenue sources helped offset impacts from specific segments.

Bilibili’s focus on cost management and operational efficiency became evident in its gross profit, which surged by 41% year-over-year to RMB 5.4 billion ($766.5 million), reflecting an improved gross profit margin of 24.2% for the fiscal year 2023, up from 17.6% in 2022.

The company also made strides toward profitability, with net loss narrowing by 36% to RMB 4.8 billion ($677.7 million) for the year, and adjusted net loss decreasing by 49% to RMB 3.4 billion ($480.9 million).

A key highlight of Bilibili’s performance is its robust user engagement, with average daily active users (DAUs) reaching 100.1 million in the fourth quarter, an 8% increase from the same period in 2022.

This user growth, coupled with an average daily time spent of over 95 minutes, underscores the platform’s strong appeal and user retention capabilities.

Looking ahead, Bilibili’s management expressed optimism about the company’s strategic direction, emphasizing continued investment in content and creator ecosystems to drive community growth and further monetization.

With a commitment to improving financials and achieving profitability, Bilibili is poised to navigate the evolving digital entertainment landscape with agility and strategic focus.

Top traffic driver compared: TikTok/Douyin vs. Kuaishou vs. Bilibili vs. RED

Douyin live commerce platform is a service platform provided by Douyin for local lifestyle service businesses. It aims to help businesses market and sell their products and services on Douyin.

Short videos were the most popular type of content on the platform, accounting for 83% of total transaction volume. Short video uploads grew nearly 1.4 times, while text content uploads grew 2.68 times.

Douyin Live streaming was also a major growth driver, with transaction volume growing 5.7 times. The number of live streams that generated transactions increased fourfold, and the coverage rate of merchant self-broadcasting reached 59%, with self-broadcasting transaction volume growing 4.45 times.

Daily search volume grew 1.57 times, and transaction volume driven by search grew 2.6 times. The most popular live-streaming content categories were:

• Food: Hot/unique dishes, fast food, hot pot, regional dishes, and bakery and desserts
• Services: Massage and bathing, beauty and fitness, hairdressing, car services, and nail and eyelash art
• Travel: Travel agencies, hotels and guesthouses, theme parks, attractions, and zoos

TikTok also saw significant growth in the number of new service providers and group-buying influencers on its platform. The number of new service providers increased 1.79 times, the number of businesses working with service providers increased nearly two times, and service provider transaction volume grew nearly eight times.

The number of group-buying influencers increased 2.89 times, and over 580,000 influencers earned income from the platform. The total transaction volume of influencers grew more than 2 times, and influencer discovery shopping generated 946 billion yuan in revenue.

Chinese influencer platforms: Weibo, Douyin, Kuaishou, Xiaohongshu

In 2022, the total views of the original content on WeChat Channel (video account) increased by 350% year on year, and the scale of live broadcast increased by 300%, according to WeChat’s data released on 10 January 2023.

The commercial potential of live video broadcasting continues to be released, and the corresponding e-commerce sales increased by more than eight times year on year.

In 2022, the number of daily active creators and the average number of videos uploaded by the video account increased by more than 100% year on year, the number of creators with at least 10,000 fans increased by 308%.

The number of video account earners increased by 101%, and the total income of live video anchors increased by 447%.

Live video GMV increased by more than 8 times year on year in 2022, and the average selling price exceeded 200 yuan. Among them, the top three categories of consumption are covered by clothing, food, and beauty.

The monthly active users of WeChat Search have increased to 800 million, and the total search volume increased by 54%. Mini Programs are widely used in scenic spots, hotels, airports, and other fields, and the number of WeChat Mini Programs has increased by 183%.

WeChat Search contributed to 27% of Official Account follower growth and 20% of Mini Program’s new daily active users. Its contribution to WeChat Channel follower growth has increased by 120%.

WeChat MAU

Over 330 million of WeChat’s (known as Weixin in China) 1.2883 billion monthly active users use video calling. 780 million users are on the social networking section WeChat Moments and 120 million publish updates. The content network WeChat Official Account has 360 million users.

WeChat has evolved from an instant messaging app to a service meeting the digital needs of over 1.27 billion MAU in Q4 2021. Each day, more than 120 million active users post in social networking Moments, 360 million users read Official Accounts articles, and 500 million users access Mini Programs (Q1 2022) daily.

For Q4 2021, WeChat daily active advertisers expanded by over 30% year-on-year. Over one-third of Moments’ advertising revenue was generated from advertisements using Mini Programs as landing pages and advertisements connecting users to customer service representatives via WeCom.

WeChat Video Accounts’ time spent per user and total video views more than doubled year-on-year as Tencent enriched content diversity and enhanced the product experience.

WeChat Mini Programs

The daily active users on WeChat Mini Programs reached 450 million according to WeChat official data in January 2022. The transaction volume of catering, tourism, and retail increased by 100% year-on-year. Mini Program DAU reached 500 million (Q1 2022).

The number of Mini Program developers has exceeded 3 million.

In 2020, the daily active users of WeChat Mini Programs exceeded 400 million, according to its official data shared at its annual event WeChat Public Lecture.

The number of mini programs used per user increased by 25%, the average transaction value per user grew by 67%, the number of programs with transactions increased by 68%, and the annual transaction volume of more than doubled in 2020.

In 2020, more than 100 million people purchased in shopping malls and department stores on WeChat Mini Programs. With the help of mini program pre-sale + offline self pick-up mode, more than 300 million users purchased fresh fruits and vegetables.

WeChat Mini Programs overview

WeChat Games

In 2020, the commercial realization of WeChat mini games increased by 20%.

Last year, the proportion of male and female users in the distribution of mini games accounted for 50% respectively. 40% of the users in the first and second-tier cities, and 65% of the users aged 30 and above.

Compared with 2019, the per capita game duration of mini games increased by 50%, and the average number of games played increased by 20% in 2020.

China game live streaming revenues to double by 2021

WeChat Search

The number of monthly active users of WeChat search has reached 700 million according to WeChat official data released in January 2022.

WeChat search staff said that in the mobile Internet era, search should not be limited by the search box, but need to be accessible by the touch. Users can search while chatting.

WeChat search will screen out the high-quality content of WeChat and produce a more accurate connection with users.

In the future, it can expand the search scope to the whole internet-based the needs of users. The search results are currently mostly provided by WeChat Official Account and Sogou.

Top search trends in China

WeChat Pay

In January 2022, WeChat shared the latest progress on WeChat Pay:

• 23 thousand monthly service providers
• Over 10 million merchants
• More than 1800 banks and Payment institutions
• 23 thousand monthly merchants
• In the next three years, WeChat Pay will continue to carry out digital upgrading of WeStore, with a planned investment of more than 10 billion yuan

In 2020, Zhifufen, a credit score on WeChat Pay, saw more than 240 million users. It boosted the conversion rate of e-commerce orders by 14% and the repurchase rate of retail merchants by 73%.

In 2021, WeChat mini stores and Zhuanzhuan (a secondhand-goods marketplace) will integrate Zhifufen.

In the e-commerce industry, WeChat Pay’s Zhifufen enables post-payment after receiving the delivery and faster refund. Users can quickly receive a refund after submitting return logistics information.

As of January 2022, more than 50% of users have activated Zhifufen, whose solutions cover more than 3000 industries. WeChat Pay unit cooperates with the e-commerce industry on “buy first and pay later”, which has been used by more than 100 million users.

Zhifufen also announced the launch of audio and video members’ services such as “watch first and pay later”, which helped solve the problems that bothered audio/music and video users to deduct fees in advance and forget to terminate their contracts.

China’s online payment users penetration reaching 86%

Enterprise version of WeChat: WeCom

In 2020, there were 80,000 enterprise WeChat partners, with a year-on-year growth of 400%. 

Acquire, convert, and retain customers through WeChat Ads + WeChat Work (WeCom)

According to WeChat, search ads will support six promotion goals, including WeChat Official Account promotion, sales lead collection, products promotion, branding events promotion, app promotion, and WeChat Mini Games promotion.

It supports three landing page types, namely, native promotion page, WeChat Mini Program, and custom link. And, based on the search ability of WeChat, WeChat search advertising can support the sale of brand keywords, keywords words, generic keywords, and generic keywords.

At present, Tencent’s mobile search advertising scenarios mainly include WeChat Search and QQ Browser search. In these scenarios, advertisers can do brand and performance marketing.

Since the launch of search feature on WeChat in 2017, it has been at the top of the main interface.

However, after five years of iteration, it has now become a “global search” that includes WeChat Moments, Official Account, and Mini Programs from the early days when it could only search local chat records and contacts.

At the same time, the search scope has also expanded to all content and services related to search queries in WeChat.

WeChat Mini Programs Insights

Zhihu’s average monthly paying members reached 8.5 million in Q2 2022, representing a growth of 78.3% YoY.

The average monthly paying members for 2021 was 5.1 million, representing a growth of 114.8% from 2020.

Its total revenues were RMB836.0 million (US$124.8 million) in the second quarter of 2022, representing a growth of 31.0% over the second quarter of 2021. The increase was driven by the expansion of Zhihu user base and the increase of its average revenue per MAU.

• Advertising revenue was RMB237.6 million (US$35.5 million)
• Paid membership revenue was RMB271.2 million (US$40.5 million)
• Content-commerce solutions revenue was RMB240.5 million (US$35.9 million)
• Vocational Training revenue was RMB46.1 million (US$6.9 million)

The rise of paid digital content in China

Zhihu’s gross profit was RMB399.6 million (US$59.7 million) in the second quarter of 2022, compared with RMB376.6 million in the same period of 2021.

Net loss was RMB487.0 million (US$72.7 million) in the second quarter of 2022, compared with RMB321.1 million in the same period of 2021.

As of June 30, 2022, Zhihu had cash and cash equivalents, term deposits, restricted cash and short-term investments of RMB7.0 billion (US$1.0 billion), compared with RMB7.4 billion as of December 31, 2021.

Zhihu just became a public company listed on the New York Stock exchange during the first quarter of 2021. Read its profile here.

China social media users’ content preference by education levels

Among non-internet companies, the top three advertisers are L’Oreal, Unilever, and P&G in 2021 with a total ad spend of 3.35 billion yuan, 2.97 bn yuan, and 2.04 bn yuan respectively.

Total ad spend in display advertising decreased further in 2021 by 7.6% YoY.

Read more on China’s digital advertising insights here.

Net income attributable to HUYA Inc. was RMB524.4 million (US$81.4 million) for the third quarter of 2021, compared with RMB253.0 million for the same period of 2020.

Non-GAAP net income attributable to HUYA Inc. was RMB180.0 million (US$27.9 million) for the third quarter of 2021, compared with RMB361.2 million for the same period of 2020.

The average mobile MAUs of Huya Live in Q3 2021 increased by 14.7% to 85.1 million, from 74.2 million in the same period of 2020. The total number of paying users of Huya Live in the third quarter of 2021 reached 6.0 million, compared with 6.0 million in the same period of 2020.

China eSports market overview and forecast