ByteDance, the Chinese technology conglomerate behind TikTok, is preparing a new employee share buyback program set to value the company at more than $330 billion, according a Reuters.
This marks a 5.5% increase in valuation from the previous buyback six months ago, which valued ByteDance at about $315 billion.
The big picture: The planned buyback price will offer employees $200.41 per share, providing liquidity for staff amid the firm’s continued revenue growth and geopolitical uncertainties.
- ByteDance’s second-quarter revenue rose approximately 25% year-on-year to around $48 billion, cementing its position as the world’s largest social media company by revenue.
- The majority of ByteDance’s revenue still comes from the Chinese market, even as the firm faces mounting political pressure to divest its U.S. operations.
- In the first quarter, ByteDance’s revenue exceeded $43 billion, surpassing Meta’s $42.3 billion in the same period. Both companies maintained over 20% sales growth in Q2 fueled by strong advertising demand.
Go deeper: ByteDance’s biannual employee share buybacks are a common practice among large private companies to provide employee liquidity without going public.
- Despite outperforming Meta in revenue, ByteDance’s valuation remains under a fifth of Meta’s $1.9 trillion market cap, largely due to U.S. regulatory and political risks.
Driving the news: U.S. lawmakers and regulators have raised national security concerns regarding ByteDance’s Chinese ownership of TikTok.
- Congress passed legislation mandating ByteDance to divest TikTok’s U.S. assets by January 19, 2025, or face a nationwide TikTok ban.
- Former President Donald Trump extended the divestiture deadline to September 17, 2025, and indicated potential further delays as U.S. buyers have stepped forward.
