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TikTok Owner ByteDance Reveals that Its Annual Revenue Soars to $34.3B in 2020

UTC by Patrick Kariuki · 3 min read
TikTok Owner ByteDance Reveals that Its Annual Revenue Soars to $34.3B in 2020
Photo: Depositphotos

As of December 2020, ByteDance’s active users were roughly 1.9 billion each month across all its platforms.

ByteDance, TikTok’s current owner, revealed to its employees that its last year’s sales brought $34.3 billion, which is two times more than the previous year’s revenue. The current development underscores why this China’s tech firm is among the most successful startups currently.

On Thursday, ByteDance shared its financial report for the year 2019 to 2020 with the employees, saying that the company’s revenue grew by 111% in one year. As per the company’s memo, seen by Wall Street Journal, the gross profit for the year was $19 billion, 93% growth compared to the previous year’s results.

ByteDance and Its Growing Revenue

As of December 2020, ByteDance’s active users were roughly 1.9 billion each month. Additionally, the firm is linked with other apps like Duyon, the Chinese version of TikTok, that have recently gone viral, Jinri Toutiao, a news app. ByteDance was founded in 2012 by Zhang Timing, a Chinese investor. The company has since been funded by notable and renowned investors such as General Atlantic and KKR & Co. Towards the end of 2020, ByteDance’s valuation stood was $180 billion following a funding round that was spearheaded by Fidelity Investments and a number of the company’s shareholders.

In the meantime, ByteDance wants to be publicly listed either in New York or Hong Kong. However, timelines for the IPO are yet to be revealed. Earlier in the year, Kuaishou Technology, a video app operator went public after it raised $5.4 billion. Recently, capital capitalization for the company, Kuaishou, was in excess of $100 billion and its revenue for the financial year ending 2020 was north of $9 billion.

Previous Performance

Apart from rosy performance, the Chinese-based company revealed that operating loss for the period between January and December 2020 was $2.1 billion. A reliable source indicated that the company attributed the loss to compensation (share-based) to employees. In the previous financial year, ByteDance had an operating profit of $684M.

The net loss for the financial year ending December 2020 was $45 billion, and it was a result of accounting adjustment for the revaluation of redeemable shares. Companies that have had to go for external funding are forced to incorporate non-cash charges to prudently account for increased valuation, which is a reporting guideline required by the IFRS (International Financial Reporting Standards).

Conclusion

TikTok is definitely China’s most successful video app. It has garnered over 240 million downloads in the US with users posting videos of their best dance moves, short talks on financial advice, and lip-synced songs. The primary revenue that ByteDance gets from TikTok mainly comeы from adverts. While ByteDance hasn’t been in the market for a long time like some other platforms such as YouTube, it’s surely proving to be a worthy competitor. In April, YouTube stated that it had 2 billion users then, which is not just about equal to ByteDance’s users.

Business News, Market News, News, Social Media, Technology News
Patrick Kariuki

Patrick is an accounting & economics graduate, a Cryptocurrency enthusiast, and a Blockchain technology fanatic. When not crafting informative pieces on any of the above subjects, he will be researching on how the Blockchain technology can transform the world, particularly the financial space.

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