TikTok’s parent company, ByteDance, suffered a billion-dollar loss last year. The Chinese tech group behind the popular movie app grew rapidly but also spent a lot on marketing and developing new features.
The Wall Street Journal reports this based on an internal report from the company.
The operating loss in 2021 amounted to almost 7.2 billion dollars. That result remains before the deduction of interest, taxes and depreciation. According to The Wall Street Journal, net income was $84.9 billion, largely due to write-downs on securities held by the company. This is an 84 percent greater loss than in 2020.
TikTok is currently one of the most popular apps among young people, making it difficult for Facebook to grow. By 2021, sales would have increased 80 percent to $61.7 billion. But costs increased almost as fast. Nevertheless, this year may see a turnaround in ByteDance’s results. The company posted an operating profit in the first three months of 2022.
Besides TikTok, ByteDance runs several apps for the Chinese market. For example, the company owns the video platform Douyin, similar to TikTok, and the news app Toutiao. Like TikTok, this news app also uses algorithms to recommend user messages based on their perceived preferences.