Chinese video-sharing social networking service TikTok has recorded a $119.5 million loss over 2019 in its U.K. business, driven by costs attributing to advertising and marketing, providing a rare insight into how quickly the app is expanding.
TikTok’s parent company, ByteDance Ltd., has not provided information about global revenue figures, but according to the latest company filings made this week, U.K. sales amounted to $20 million over 2019. Expenses related to sales and marketing came to $109 million over the year. The unit hadn’t begun posting revenue in 2018.
According to Bloomberg, “ByteDance is said to have generated over $3 billion of profit on more than $17 billion of revenue in 2019.” Also, the startup tracker has reported that ByteDance is already worth $140 billion.
Among the teenagers, TikTok has shot to fame globally and has made quite the name for itself over a few years. Its influence has also attracted outrage from the Trump administration, which argues that the app’s Chinese ownership brings about a national security threat.
TikTok had just a handful of staff in the U.K by the end of the year 2018. The social networking app has since been rapidly expanding, hiring hundreds of employees from rival companies. It has also planned on making London its international headquarters. However, no confirmed decision has been made by the company.
“As of today, the TikTok community numbers over 100 million people across the U.K. and Europe, and we’re excited about our future growth potential,” said a TikTok spokesman, according to Bloomberg. “These results reflect an early period of development and investment for TikTok in the U.K., and should be taken in that context.”
Uncertainty lies within the future of TikTok’s global business. In mid-September, a preliminary plan was approved by the U.S. President Donald Trump in which ByteDance would sell part of TikTok to Walmart Inc, Oracle Corp., and U.S. investment firms Sequoia Capital, KKR & Co., and General Atlantic, giving rise to a new independent company called TikTok Global. For months that deal has been stuck in limbo.
The U.K. filing said “a number of strategic options are being considered in connection with the future operational structure of TikTok global business,” but added that the U.K. business would not face any direct impact due to the changes.