ByteDance’s Black Box, Target’s Inventory Turnaround, and the Resale Watch Market | Prof G Markets

Transparency Issues

Scott Galloway raises concerns about ByteDance's financial transparency, highlighting the company's recent revenue surge. ByteDance's second-quarter revenue grew by over 40% to $29 billion, yet only 20% of this comes from outside China, raising questions about TikTok's actual financial impact abroad 1. Scott questions the reliability of these figures, suggesting they might be manipulated to maintain ByteDance's perceived value while avoiding scrutiny from U.S. regulators 2.

I just wonder, are these numbers bullshit or are they just numbers that they make up to try and thread the needle between ensuring this company is valuable if and when it goes public?

--- Scott Galloway

The lack of transparency makes it difficult for investors to assess the true value and risks associated with ByteDance 2.

   

Regulatory Risks

The regulatory risks surrounding TikTok and ByteDance are significant, with Scott Galloway suggesting a potential ban on TikTok in the U.S. as a credible threat 2. He argues that ByteDance's opaque financial disclosures and the app's dominance in the U.S. market pose a challenge for regulators 3.

I think they're more of a juggernaut than people think. I think it's the only Internet company in the world right now that is sandbagging its numbers such that it doesn't raise the alarm bells.

--- Scott Galloway

Scott believes that TikTok's undervaluation is partly due to regulatory risks and geopolitical tensions, which could impact its future operations and investment potential 3.