ByteDance experienced a significant increase in revenue during the first half of 2023, despite increased spending on artificial intelligence initiatives that impacted its profits, according to sources familiar with the company. Revenue rose by more than 30% to reach $120 billion, supported by growth in international advertising, livestreaming, and the e-commerce segment of TikTok, ByteDance’s popular video-sharing app.

The company’s net profit decreased to $20 billion for the first half of the year, reflecting the higher investments in artificial intelligence technologies. Last year, ByteDance’s annual revenue increased 29% to $200 billion, while net profit grew 27% to $42 billion, according to the same sources.

The revenue growth occurred amid a backdrop of regulatory scrutiny in the United States. TikTok had been under a prolonged national security review by U.S. authorities. In January 2023, ByteDance took a key step to address these concerns by forming a joint venture to manage TikTok’s operations in the United States. This move helped clear regulatory obstacles and enabled the company to focus on expanding its business in the U.S. market.

The company’s international advertising sales and TikTok’s continual expansion into e-commerce and livestreaming have been major drivers of growth, highlighting ByteDance’s strategy to diversify its revenue streams beyond its core social media platform. While profitability faced pressure from the company’s efforts to strengthen its artificial intelligence capabilities, ByteDance’s overall financial performance demonstrates resilience in an increasingly competitive global technology landscape.