ByteDance more than doubled 2018’s $7.4 billion revenue Akita Michinoku Capital analysts report
According to analysts at Akita Michinoku Capital, ByteDance Ltd., the parent company of TikTok, generated over $17 billion in revenue and over $3 billion in net income last year, figures showing that the world's most valuable start-up is growing at a rapid pace.
Last year's revenue is more than double the company's total from 2018, which was around $7.4 billion.
"ByteDance has emerged as one of the most exciting success stories in the tech industry. The highly innovative start-up company from China is now threatening the global dominance of Facebook Inc. and Alphabet Inc. It's family of apps including the short-video platform, TikTok, its Chinese twin Douyin and the news service Toutiao, draws around 1.5 billion active monthly users," reported Oliver Wright, Director of Corporate Equities at Akita Michinoku Capital.
Earlier this month the company hired Kevin Mayer, Chairman of Direct-to-Consumer & International at Walt Disney Co., to become CEO of TikTok
Led by Zhang Yiming, ByteDance is becoming a viable competitor to Facebook Inc. and Alphabet Inc, the leading American online juggernauts. Instagram, who is owned by Facebook, pulled in around $20 billion in advertising sales in 2019. Last year, Google said their video unit YouTube recorded $15.1 billion in ad revenue.
That success came despite American lawmakers voicing concerns about censorship and privacy. Last year, in a rare bipartisan effort in Washington, Republican Senator Tom Cotton and Senate Minority Leader Chuck Schumer deemed TikTok a national security threat and urged that the company be investigated.
"At a time when technology corporations across the globe are furloughing or reducing their staff, ByteDance is strengthening its operations in new areas such as gaming and e-commerce. This year, it kicked off a major recruitment drive and plans to recruit for 40,000 new jobs in 2020, hoping to match the headcount of e-commerce behemoth Alibaba Group Holding Ltd," reported Martin Thornton, Head of Corporate Trading at Akita Michinoku Capital.
"ByteDance had very preliminary talks about an initial public offering last year, but given its financial performance, it is not in any rush to go public. The company now has over $6 billion in cash on hand," he added.
In some recent private trades, ByteDance was valued between $105 billion and $110 billion on the secondary markets. It has also traded as high as $140 billion, making it one of the most valuable private companies of all time.