We have some new official data on the growth of TikTok’s business, courtesy of financial results filed by its European subsidiary TikTok Information Technologies UK. First reported on by CNBC, the results can be accessed through the UK’s Companies House website.
What do they reveal? In 2020, TikTok’s revenues in Europe grew by an impressive 545% to $170.8m. The UK may not be part of Europe any more, but TikTok’s UK subsidiary still handles its business for the wider region, with those revenues coming “mainly through distributing online advertising” in its app.
TikTok said that the sharp increase in revenues was the result of “a substantial increase in our user base which attracted more online advertisers and paying users” – those being people who buy virtual coins in TikTok’s app to send virtual gifts to their favourite livestreamers.
$151.7m of the revenues (around 89%) came from advertising while $16.6m came from the livestreaming side, with a further $2.5m generated by services provided to the wider TikTok business. While the financials do not say how big TikTok’s European user base was by the end of 2020, in September that year the company said that it had more than 100 million monthly active users in the region.
That has fuelled the revenue growth, and encouraged TikTok to go on a hiring spree in Europe in 2020. At the end of 2019, TikTok employed 208 staff in Europe, but just a year later that figure had swollen to 1,294.
This expansion brought costs with it however: TikTok’s operating losses in Europe grew from $118.7m in 2019 to $644.3m in 2020. While parent company ByteDance’s global revenues of $34.3bn that year mean these costs can be borne easily, it’s useful data to show just how much investment has gone into TikTok’s rapid growth in Europe – a trend mirrored in its other key regions too.