TikTok's US division is currently facing more than an impending nationwide ban but stagnating revenues due to rising business challenges and stronger competition.
TikTok's ad and e-commerce sales are reportedly stalling following recent policy changes on the platform, people familiar with the matter told The Wall Street Journal.
There is also its ongoing license dispute with Universal Music Group, further hurting the app's profits as a music platform.
This is in addition to the growing number of users complaining about TikTok's shift towards horizontal long-form videos rather than its vertical shorts that made the site more famous.
Although TikTok is still reaching its revenue predictions, it is rare for the results to exceed markers as it did in previous financial years.
It is worth noting, however, that TikTok overall is still profiting from its international divisions, particularly with a booming business in Asia.
TikTok just recently even became the first non-gaming app to reach the $10 billion landmark for in-app purchases, surpassing the likes of Netflix, Disney+, and Meta's social media platforms.
Lawmakers Urge ByteDance to Sell TikTok's US Division
If the reports of stagnating revenue growth proved to be true, calls for ByteDance, TikTok's parent company, may soon become much more prominent as the proposed ban inches closer to implementation.
Former Treasury Secretary Steven Mnuchin and Activision Blizzard ex-CEO Bobby Kotick earlier expressed interest in acquiring the platform's US branch to keep them in the country.
TikTok currently hosts over 170 million daily users in the US and 7 million businesses on its app or at least 10% of its total user base.
As of writing, TikTok CEO Shou Zi Chew has yet to declare any intentions to separate its US division from ByteDance, reiterating that the bill will be sure to ban TikTok overall in the country.
@tiktok Response to TikTok Ban Bill ♬ original sound - TikTok
Part of the proposed Protecting Americans from Foreign Adversary Controlled Applications Act is targeted to ban all ByteDance's apps and other programs "controlled by foreign adversary companies" from the U.S.
US Users Defend TikTok from Looming Ban
While lawmakers are pushing for a nationwide ban on TikTok, more and more of its users have started protesting against the proposition.
Aside from YouTube, TikTok is the most used app among younger generations in the US, making the platform the main channel for young people to share their opinions online.
Among the rising discussions on the app among younger US users are related to politics, human rights issues, and Israel's genocide campaign in Gaza.
It is worth noting that the bill is being pushed to be passed two months ahead of the 2024 US Presidential Elections where several lawmakers, including the president, are running for their subsequent term.
