TikTok (also known as Douyin International) notified employees in the United States e-commerce department on Wednesday, May 21, to work from home and await an email regarding a “difficult decision,” with reports indicating that the social media company is preparing for layoffs.
According to Bloomberg, Mu Qing, the newly appointed head of TikTok Shop’s US business, mentioned in an internal memo that the company is seeking a “more efficient operational model.”
TikTok Shop is the e-commerce business based on TikTok, functioning similarly to Douyin Xiaodian, allowing users to directly place orders through shopping links displayed on videos they find interesting.
Mu Qing, who previously held a senior position in the e-commerce department of Douyin, a subsidiary of ByteDance (TikTok’s parent company in China), took over TikTok’s US e-commerce business in Seattle last month. In the memo, he informed employees that operational and staffing adjustments will be made starting Wednesday for the US e-commerce operations center and global key account team.
The email sent on Tuesday evening pledged to assist affected employees during this period with “sympathy and support.”
TikTok has over 1,000 employees in the Seattle area and operates offices in New York, Texas, and California.
Representatives of ByteDance and TikTok did not immediately respond to Bloomberg’s request for comments.
TikTok launched its e-commerce function, TikTok Shop, for US users in September 2023, claiming sales once surpassed competitors like the Chinese online retailers Shein and Temu.
However, since its launch, TikTok Shop has faced challenges such as false product information, promotional reviews generated by artificial intelligence, malicious reviews, and fraudulent activities.
Moreover, it is widely known that TikTok’s future in the United States is uncertain.
Due to national security concerns, the US Congress passed a bipartisan bill last year stipulating that TikTok would be banned from operating in the US unless it “qualitatively separates” from ByteDance, its parent company controlled by the Chinese government.
Additionally, President Trump recently imposed tariffs on Chinese exports and ended the de minimis exemption policy, terminating the duty-free import of goods valued below $800, posing further challenges to TikTok’s operations. With 170 million monthly active users in the US, e-commerce is a key strategy for TikTok to monetize its popularity.