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TikTok’s European sales surge sixfold to almost $1bn

TikTok app logo - DADO RUVIC via REUTERS
TikTok app logo - DADO RUVIC via REUTERS

TikTok has seen sales at its UK business grow almost sixfold to nearly $1bn (£890m) as advertisers flock to the Chinese social media company.

TikTok’s London-headquartered international arm, which includes its European operations and its divisions outside of the US and China, reported $990m in revenues in the 12 months ending in December, up from $172m the previous year.

The figures underline the speed of the Chinese company’s rapid rise. Its international arm has reached revenues of almost $1bn just two years after adding advertising to its app and six years after launching here. By comparison, Facebook hit revenues of $1bn in Europe after seven years of operations here.

TikTok’s losses were up by more than a third to $896m as it increased spending on staff, ramping up its headcount to more than 4,300 people.

The results show TikTok’s rapid growth continued throughout the coronavirus pandemic after enjoying breakout success during lockdowns as people sought distraction.

The majority of its revenues - $802m - came from advertising after TikTok added digital ads to its short-form video-sharing app in 2020. It is highly popular with Gen Z, the generation of teens and 20-somethings that brands are keen to reach.

UK revenues at TikTok grew from $51m in 2020 to $280m in 2021. Its mainland European business reported total sales of $531m.

TikTok has more than 1 billion monthly users globally and the Chinese app increasingly challenges Meta-owned Facebook and Instagram for social media dominance.

Its growth has coincided with rising regulatory and political scrutiny. There are national security concerns about its Chinese ownership and the way it uses data.

In the UK, it faces a £27m fine over alleged breaches of UK data protection law. The company has been issued with a provisional warning by the Information Commissioner’s Office, which found that TikTok processed the data of children under the age of 13 without parental consent. TikTok has said it disagrees with the data regulator’s findings.

The company is also currently drawing up a deal to allow it to continue operating in the US. Former US President Donald Trump pushed for the forced sale of TikTok’s US business due to concerns about its Chinese ownership.

A TikTok account created by Parliament was recently shut down after MPs expressed concerns over data security.

Despite its rapid growth, TikTok’s parent company, Bytedance, has repeatedly delayed a potential $300bn float after its valuation fell in private market trades. The company’s founder, Zhang Yiming, quit as chairman last year amid pressure from Beijing, which has cracked down on China’s tech giants.