Reports suggest TikTok revenues up 40% to $120bn in 2023

Short video platform TikTok is on track to overtake Meta, after reports that the company made $120bn worldwide in 2023, up 40% year-on-year, with $16bn of that coming from the US alone as it faces legislation that could force the sale of the company in order to continue operating in the country. 

Why TikTok’s growth matters

Amid a political storm in the United States, TikTok is emerging as one of the most important media companies on earth. Not only does it make a lot of money and entertain a lot of people, research is discovering that it is effective in different ways from its rivals, especially in the field of new customer acquisition. 

The figures first reported by the Financial Times indicate how TikTok is a major media player as well as a huge political story, whatever happens next.

The Meta comparison

TikTok’s global audience, at 1.56 billion users each month, is almost as large as that of Instagram’s at 1.65 billion. 

The privately owned company, which doesn’t have to declare its revenues to the stock market, is now approaching Meta ($131bn in 2023) levels of revenue too, it would appear. And much faster: revenues in 2023 grew over 40% compared to Meta’s 16%. 

While ByteDance as a whole may turn a profit, it is largely because of its Chinese operations where it runs a successful e-commerce interest. By comparison, TikTok is spending heavily to continue growing in much of the rest of the world; losing US influencers could see a vital attraction to its platform disappear. 

Political controversy

Huge growth in revenue for TikTok, which is owned by Beijing-headquartered ByteDance, comes amid the passage of a bill through the US Congress that could force it to sell to a non-Chinese company within six months. 

The bill, which is yet to be debated in the US Senate – where it is unlikely to pass as smoothly as it did in the House – sets up the potential for a high-profile battle over free speech that could be decided in the courts.

• Not only is the controversial legislation likely to face challenges, any sale of US TikTok is going to be incredibly expensive and will still require Chinese approval. 
• It’s also worth noting that ByteDance is no nationalised enterprise: multiple American venture capitalists have been involved for a long time.

Although the bill passed thanks to members on both sides of the political aisle, Americans are much more divided: 31% of adults favour a ban while 35% oppose it, with the typical tell of which way you swing depending on whether you use the app. Many voters also believe the country faces graver issues.

Sourced from the FT, WARC, WSJ, Washington Post