Tiktok’s parent company Bytedance posts record profit in 2022

ByteDance, Tiktok’s parent company, posted a record profit last year, surpassing Chinese tech giants Tencent and Alibaba for the first time.

According to two investors informed on the matter, the company’s earnings before interest, depreciation and taxes (EBITDA) rose from $14 billion in 2021 to nearly $25 billion in 2022, up 79 percent year-over-year.

INCREASE IN ADVERTISING SPENDING

ByteDance’s rapid earnings growth came as advertisers increased spending on TikTok and its Chinese sister app Douyin. Ad sales were about $85 billion in 2022, up 30 percent from the previous year.

Thus, ByteDance, which was valued at $300 billion last year, surpassed Chinese tech giants Tencent and Alibaba, which reported EBITDA of $23.9 billion and $22.5 billion, respectively, in 2022. Both groups have been hit hard by the Beijing administration’s regulatory crackdown on tech giants.

PANIC TIKTOK

On the other hand, the growth of TikTok has also caused security concerns from governments and regulators around the world. The US government, on the agenda of banning the video app, called to sell the app.

TikTok CEO Shou Zi Chew said in his speech to the US Congress that the app “will not be tampered with by any government.” Beijing has said it will “absolutely” oppose any move to separate TikTok’s American arm from its Chinese owners.

Any forced sale or ban from TikTok could negatively affect ByteDance’s potential earnings. TikTok is also seen as an important tool, even though the company generated about 80 percent of its revenue in China last year.