UBS: Raises Bilibili-W (09626) target price to 314.9 Hong Kong dollars, better advertising growth prospects

UBS Group AG released a research report stating that the management of BILIBILI-W (09626) believes that the company's performance in the fourth quarter meets expectations. The target price for the Hong Kong stock has been raised from 279.9 Hong Kong dollars to 314.9 Hong Kong dollars, and the target price for the BILIBILI-W (BILI.US) American stock has been raised from 36 US dollars to 40.5 US dollars, maintaining a "buy" rating. Looking ahead to 2026, the management has a constructive view on the growth prospects of advertising, and points out that there are early signs of growth in demand from AI and game advertisers. The company is confident in continuously attracting the budget allocations of e-commerce advertisers, and will actively expand into new verticals to broaden the coverage of advertising clients. In terms of games, the management pointed out that "Three Kingdoms: Strategy to Conquer the World" experienced seasonal fluctuations in the fourth quarter of 2025 (mainly only one season), and expects stable revenue in the first quarter of this year as there will be two seasons (S12 and S13). The version of this game in Hong Kong, Macau, and Taiwan is planned to be launched at the end of January, while the versions in Japan and Korea are scheduled to be launched in the second half of this year. As for "Three Kingdoms: A Hundred Generals," the company plans to conduct a new round of testing after the Chinese New Year. The management believes that this game has tremendous potential in emerging markets, and has a constructive view on its long-term operational and profit capabilities, and may consider developing a mini-game version. The bank has raised its revenue and profit forecasts for 2026 by 1% and 2% respectively, due to better prospects for advertising growth.