ByteDance eclipses Tencent in revenue, profit in 2023: report

Photo credit: ByteDance

Despite a year filled with regulatory challenges, ByteDance‘s earnings soared in 2023 as its EBITDA rose to over US$40 billion, people familiar with the matter told Bloomberg. That marks a 60% increase from the prior year for the China-based parent firm of short-video app TikTok.

ByteDance is also gaining on its rivals. Its sales grew from US$80 billion to around US$120 billion, allowing it to overtake Tencent in revenue and profit for the first time, the sources added.

Douyin, the Chinese version of TikTok, is slowly eating into Alibaba’s ecommerce space and competing with Meituan in food delivery.

ByteDance has further diversified its overseas business with the rollout of TikTok Shop in the US and Southeast Asia.

However, TikTok is on the verge of being prohibited in the US unless ByteDance relinquishes ownership. A bill pushing for a ban on the app has been greenlighted by the US House of Representatives, but Senate approval is still unconfirmed.

Meanwhile, TikTok Shop sidestepped regulatory troubles in Indonesia through its tie-up with Tokopedia, the homegrown ecommerce giant that forms half of GoTo and Gojek.

ByteDance has also stepped back from high-risk ventures to focus on profitability, cutting hundreds of jobs in gaming and enterprise software – areas that did not meet its revenue expectations.

Instead, the company has zeroed in on AI, developing its own chatbots and language models. In August 2023, ByteDance launched a chatbot called Doubao after the nod from Chinese regulators.

However, ByteDance couldn’t seem to dodge controversy even in this industry. It’s in hot water for secretly using tech from OpenAI to build a competing product.

Nevertheless, ByteDance in December proposed buying back shares worth up to US$5 billion at a lower valuation of US$268 billion, falling from its peak of US$400 billion.

See also: GoTo CEO delivers first quarterly profit, but will he stay on?