TikTok owner ByteDance has been losing momentum in 2024, with slower revenue growth and narrower profit margins for the first three quarters compared with last year, according to local media.
Revenue growth “significantly” slowed for the first nine months of the year, while profit margins slimmed for the first time since 2022, Chinese tech media 36Kr reported on Thursday, citing an unnamed source.
TikTok’s revenue from January to September “missed expectations”, while the app’s e-commerce feature TikTok Shop “missed its GMV [gross merchandise volume] target for the past few months”, failing to replicate the success of selling goods through Douyin, the version of the app for mainland China.
ByteDance has been pushing TikTok Shop in several international markets – including the US, UK and Southeast Asian countries – as it looks for monetisation beyond advertising on its hugely popular but unprofitable video platform.
The report attributed the weak performance to sluggish advertising spending in China, the impact of geopolitical tensions and the fact that the company has burned large sums of cash on artificial intelligence and large language models.
ByteDance’s advertising revenue growth in China fell below 17 per cent in the third quarter, down from 40 per cent in the first quarter, online media outlet LatePost reported on Monday. The ads department missed its targets for the past two quarters, according to the report.