According to sources on April 20, ByteDance's overseas revenue in 2025 grew by nearly 50% year-over-year, with its share of total revenue exceeding 30% for the first time, reaching a historic high. TikTok's e-commerce Gross Merchandise Volume (GMV) growth approached 70%.

However, due to a significant increase in AI computing power procurement and infrastructure spending, along with changes in the costs associated with preferred shares and options, the company's full-year net profit declined by over 70% compared to the previous year.

In a post on Weibo, ByteDance Vice President Li Liang stated that excluding the impact of preferred share and option cost changes, overall revenue and profit actually showed growth. He also noted that TikTok's e-commerce business and emerging ventures continue to develop favorably.

Amid the tension between investment and output, valuation and profit, this unlisted tech giant is reshaping its growth narrative through a major bet on artificial intelligence.

**Overseas Breakthrough** ByteDance's international operations delivered better-than-expected results in 2025. Sources indicate that overseas revenue grew nearly 50%, increasing its contribution to total revenue from 25% in 2024 to over 30%, setting a new record.

The primary driver of this growth was TikTok Shop, which saw its GMV increase by almost 70% year-over-year in 2025. Public data shows TikTok Shop now has 400 million active consumers, with annual GMV approaching one trillion US dollars. Sales in the US market grew by 108%, while the European market saw growth exceeding 100%. After securing the second position in Southeast Asia, the platform experienced rapid expansion in new markets like Latin America and Japan; GMV in Brazil grew 25-fold in the first three months after launch, and Japan achieved 20-fold growth within four months.

This strong overseas revenue performance coincided with a critical development for TikTok's US operations in early 2026. On January 22, 2026, TikTok officially announced the establishment of TikTok USDS Joint Venture LLC, a data security partnership, successfully preserving its business in the US market.

In stark contrast to the revenue growth, the company's profitability contracted. Sources also revealed that ByteDance's net profit for 2025 fell by more than 70% year-over-year, leading to a significant decline in net profit margin. The majority of this decrease occurred in the third and fourth quarters, directly attributed to a substantial rise in capital expenditure for AI computing power procurement, model research and development, and data center infrastructure during that period.

On the afternoon of April 20, Li Liang posted on Weibo, clarifying that the reported 70% net profit decline was a figure based on International Financial Reporting Standards (IFRS). He emphasized that besides increased investment in emerging businesses, the figure was affected by changes in preferred share and option costs, which do not reflect operational reality. He stated that the actual operating profit margin saw a slight decline in the second half of the year due to slowing growth in Douyin's e-commerce and increased investment in new ventures, but the decrease was far less severe than reported.

**Heavy Bet on AI** Sources indicate that in communications with shareholders, ByteDance stated that technological resource investments will further increase in 2026. Coupled with new factors like the US data security joint venture, the company's net profit margin may continue to face pressure in the short term.

These substantial financial investments are already yielding quantifiable progress on the product side. According to disclosures from Volcano Engine, as of March 2026, the daily token calls for the Doubao large language model had exceeded 120 trillion, doubling within three months and representing a 1,000-fold increase since its initial launch in May 2024, ranking first in China and among the top three globally (behind only OpenAI and Google). In Q1 2026, Doubao's monthly active users surpassed 200 million, making it the AI-native application with the highest user count in China. On the enterprise side, the number of Volcano Engine's external clients with cumulative token calls exceeding one trillion had grown to 140.

AI investment is manifesting not only in computing power and products but also in talent incentive mechanisms. In October 2025, ByteDance initiated an internal pilot of the Doubao Long-Term Incentive Plan, establishing a virtual share mechanism for the large language model business related to Doubao. This plan has currently been implemented within the Seed department.

Unlike traditional cash bonuses or company-wide option pools, the Doubao shares, through the granting of virtual stock and a buyback mechanism similar to ByteDance options, allow key technical personnel to share in the value created by the business's growth.

At the business structure level, AI integration is altering ByteDance's revenue composition. Based on data previously disclosed by media and industry organizations, Douyin's domestic total revenue for the full year 2025 was approximately 9.012 trillion Chinese yuan, a year-over-year increase of 28.3%. Breaking down the structure, annual advertising revenue was 4.2 trillion yuan, accounting for 46.6% of total revenue. The corresponding annual GMV for the e-commerce business exceeded 4 trillion yuan, with e-commerce revenue comprising about 45.5% of overall revenue. Local lifestyle services achieved an annual GMV of approximately 712 billion yuan, a 59% increase. In terms of user base, Douyin's domestic daily active users surpassed 850 million in 2025, with monthly active users exceeding 1 billion. Globally, ByteDance's short video products (including TikTok) reached a combined monthly active user base of over 2 billion, making it the first short video platform globally to achieve this scale. The strong performance of overseas operations continued, with TikTok's global advertising revenue reaching approximately $33.1 billion in 2025, a 40.5% increase. The proportion of ByteDance's total revenue derived from overseas business exceeded 30% for the first time in 2025.

**Rising Valuation** On April 15, 2026, ByteDance issued an internal email announcing a new round of option repurchases. The repurchase price for current employees was set at $229.5 per share, while the price for former employees was $201.96 per share. In January of the same year, the company's option price had been adjusted upward to $226.07 per share.

It is understood that ByteDance established a semi-annual (April and October) regular option repurchase mechanism starting in 2021. The repurchase price for current employees was $126 per share in 2021, rising to $229.5 per share by April 2026, nearly doubling the internal valuation over four years.

Around the same time, ByteDance also conducted the first repurchase of Doubao shares. On April 16, the Doubao share repurchase price was $13.08 per share, approximately 30.8% higher than the grant price of $10. Sources indicated that $13.08 per share represents the latest pricing for Doubao shares; employees who joined after March 1, 2026, and receive Doubao share incentives will also have their grant quantity calculated based on this price.

The Doubao share mechanism employs batch-based vesting and a tiered repurchase structure: For 'Total Package' type Doubao shares, 40% of the vested portion can be repurchased in the first year after vesting, with the repurchaseable percentage for that batch increasing by 12% for each subsequent full year. For 'Performance-based' Doubao shares, 40% can also be repurchased in the first year, with the repurchaseable percentage increasing by 15% for each subsequent full year. Repurchase can be requested for any batch once it reaches at least one share.

'Total Package' shares primarily refer to those granted upon hiring and additional grants accompanying salary adjustments, while 'Performance-based' shares are awarded based on performance review results. The difference in the repurchase escalation rhythm between the two types corresponds to employee incentives in different scenarios.

The consistent rise in internal repurchase prices aligns with valuations seen in external equity transactions. In November 2025, Capital Today participated in a secondary share transfer of ByteDance at a valuation of $480 billion. In February 2026, General Atlantic sold part of its stake, at which time ByteDance's valuation reached $550 billion.

The divergence between valuation and profit reflects investors' pricing of revenue scale and the AI growth trajectory, as well as the scarcity of unlisted equity in the secondary market.

ByteDance's continued investment in talent also underpins external confidence. At the company-wide meeting in early 2026, CEO Liang Rubo set the annual theme as "Courageously Scaling New Heights," emphasizing the need to increase talent density, enhance incentives for personnel, and ensure that compensation and incentives remain leading levels across all global markets.

Across the broader technology industry, competition for top talent in cutting-edge technologies has intensified. Public information shows that since the beginning of 2026, leading companies like Tencent, Alibaba, and Baidu have significantly expanded their recruitment for AI-related positions. Tencent increased technical role hiring by 36%, over 60% of Alibaba's new positions were AI-related, and AI roles accounted for over 90% of Baidu's campus recruitment, all focusing on core areas such as large language models, multimodality, and AI agents.

Looking ahead to 2026, the race of "trading profit for future growth" has only just begun.