ByteDance Reports 70% Net Profit Decline; Li Liang Attributes Drop to Accounting Factors and AI Investment Surge

Gate News message, April 20 — ByteDance’s net profit declined over 70% year-over-year in 2025, according to reports. On April 28, Li Liang, vice president of Douyin (TikTok China), clarified on social media that the decline under international accounting standards was primarily driven by changes in preferred stock and option costs, rather than operational deterioration.

“Due to slower growth in Douyin e-commerce and increased investment in emerging businesses, operating profit margins showed a slight decline in the second half, but far less severe than reported,” Li stated. “Excluding preferred stock and option cost changes, overall revenue and profit grew, with TikTokShop e-commerce and emerging businesses showing positive development trends.”

ByteDance’s 2025 net profit decline was mainly attributed to significant increases in AI computing power procurement, model research and development, and infrastructure investment in the third and fourth quarters. However, the company achieved strong international growth, with overseas revenue increasing nearly 50% year-over-year, significantly outpacing domestic growth of approximately 20%. Overseas revenue’s share of total revenue rose from 25% in 2024 to over 30%, reaching a record high.

TikTokShop emerged as the key driver of international expansion, with annual GMV growing nearly 70% and reaching close to $100 billion. The platform now serves 4 billion active consumers globally. The U.S. market recorded 108% year-over-year sales growth, while major European markets exceeded 100% growth. Southeast Asia maintained second position in the regional e-commerce market. New markets showed impressive performance: Brazil’s GMV grew approximately 25-fold within three months of launch, and Japan’s grew about 20-fold in four months. Fourth-quarter GMV surpassed $25 billion, with December’s monthly GMV exceeding Shopee’s in overseas markets.

Despite strong growth, TikTokShop faces intensifying competition and regulatory pressures. Amazon launched AmazonHaul, a discount marketplace for products under $20, while Shopee increased live-streaming investments and partnered with YouTube to expand short-video shopping. The European Union plans to impose fees on low-value parcels and strengthen compliance oversight, while emerging markets are tightening regulations over foreign e-commerce platforms, creating uncertainty for TikTokShop’s further expansion.