BEIJING, January 20 (TMTPOST)— ByteDance saw significantly slowdown in revenue growth during the past year as the TikTok’s parent was reported to record double-digit sales growth again in 2021 but less than that of 2020.
Source: Visual China
ByteDance disclosed in an internal meeting this week that it had total revenue of about US$58 billion in the year 2021, representing an increase of 70% from the previous year, Reuters cited people familiar with the matter on Thursday. The TikTok owner didn’t comment on the news, but if the data is accurate, its performance was obviously overshadowed by that in 2020, a year that the COVID19 outbreak started and many technology firms became beneficiaries from the stay-at-home order during the pandemic. The company posted annual revenue of US$34.3 billion with a year-over-year growth of 111%, and gross profit jumped 93% to US$19 billion, The Wall Street Journal learned from a memo in last June.
In fact, the overall digital advertising market in China showed a decreasing growth trend last year, and ByteDance, as the world’s leading private tech company which heavily relies on ad revenue, was no exception. The annual online ad sales in the whole country saw a growth of 9.3% in 2021, down from 2020’s 13.8%, according to a report by researcher Interactive Marketing Lab Zhongguancun.
ByteDance is expected to increase the annual revenue by about 60% to RMB400 billion (US$63 billion) in 2021, cementing its position as world’s top five online ad sellers, according to the internal projections cited by The Information in last November. According to the tech media, the TikTok owner’s revenue relatively slowed down as its sales in 2020 more than doubled to RMB250 billion, but it still had faster growth than other major social media competitors: Facebook and sister platforms under Meta posted a year-over-year (YoY) increase of 46% in revenue in the first nine months of 2021, while Tencent, the runner of two most popular social media apps WeChat and QQ, just rose 14% in the same period.
ByteDance has experienced overhauls amid the tightening regulatory environment in its home market. In November, the CEO Liang Rubin launched his first major reorganization after the founder Zhang Yiming suddenly announced to step down as CEO in May. Under the new business structure, it has six units, one of which consists of TikTok’s Chinese sister Douyin, Toutiao, the most popular news app in China, Xigua, a video-streaming app, the online encyclopedia arm Baike, the search engine Search and vertical service businesses in domestic market. TikTok remained a key business as there was a standalone unit that takes charge of operations of the platform and also supports development of relevant expansions such as overseas e-commerce.
Earlier this week, ByteDance was reported to dissolve its strategic investment team and reassign around a hundred employees to other positions. The decision was made to reduce investment in areas that have low compatibility to its businesses, and members of the strategic investment team will be reallocated to different business lines to enhance the strategy unit’s coordination with other business units, an insider told TMTPost.