TikTok surpasses $10 billion in consumer spending, first non-game app to do so
TikTok just hit a major milestone by becoming the first non-game mobile app to rake in over $10 billion in consumer spending across both the Apple App Store and Google Play, according to a recent report by the app analytics firm data.ai.
Tinder and YouTube are the next-closest applications to the $10 billion milestone but they trail TikTok by between $2 and $3 billion as we approach the end of the year. The only other apps that hit this milestone are all games, including Candy Crush Saga at $12 billion, Honor of Kings at $11 billion, Monster Strike at $10.6 billion, and Clash of Clans at $10.2 billion.
This achievement, solidified in the final quarter of 2023, officially establishes TikTok as a major player in the global app economy. It’s worth noting that the Binance-owned TikTok app reached the impressive milestone of 1 billion monthly active users back in 2021.
It’s worth noting that TikTok hit 1 billion monthly active users back in 2021. What’s interesting is how it took TikTok a bit longer—79 months—to hit its first billion dollars compared to gaming apps, which did it way faster, usually in 20 months or less.
But here’s the twist: once TikTok got going, it zoomed ahead. It only took 22 months to go from $1 billion to $5 billion, and then just 15 months to skyrocket from $5 billion to $10 billion. Other apps couldn’t keep up with that pace.
“By surpassing the $10 billion gross revenue milestone, TikTok has become one of just five mobile apps to have done so, and the first that wasn’t a mobile game to do so. It sits atop the market alongside mobile greats Candy Crush Saga from King/Activision Blizzard, the all-time top earner at more than $12 billion, Honor of Kings from Tencent ($11B), Monster Strike from XFLAG/Mixi ($10.6B) and Clash of Clans from Supercell ($10.2B),” data.ai said in its report.
“TikTok is poised to become the highest-earning mobile app ever,” Lexi Sydow, Head of Insights at data.ai, said.
Just this year, the short video app, famous for its viral content and captivating style, experienced an incredible surge in consumer spending, scoring an impressive addition of almost $4 billion. That’s a whopping 61% increase from the beginning of 2023.
TikTok’s financial triumph is powered primarily by its virtual currency, which users use to buy gifts for content creators. This model has significantly changed how social platforms make money from their user base.
In terms of sources of TikTok’s overall revenue, consumers in the United States and iOS users in China are neck-and-neck. Each has chipped in around 30%, making it a total of 60%, which translates to about $6 billion. Following this tie for the top spot, the next leading markets are Saudi Arabia at #2, Germany at #3, the United Kingdom at #4, and Japan at #5. Together, these four countries make up approximately 13% of the app’s in-app purchase revenue.
According to Data.ai, we’re just scratching the surface of consumer spending on TikTok. The firm anticipates that TikTok’s growth will soar even higher in 2024, with an estimated consumer spending reaching a whopping $15 billion. Looks like TikTok is set for some impressive times ahead.
“That revenue is set for even greater growth in 2024, when, as data.ai predicted last week, TikTok will reach $15 billion in consumer spend, or 50% more than its current cumulative sum. Of course, this is on top of TikTok’s other revenue streams, which began with in-app advertising and have expanded to include e-commerce in the form of TikTok Shop, which launched in the app in September of this year.”
Launched in 2016, TikTok has become a growing global phenomenon due to its ability to quickly get its users addicted to its short-form viral videos loved by millions of youths. In just a few years after its launch, TikTok now has over 1 billion users in more than 150 countries. The TikTok app has been downloaded over 210 million times in the United States alone.