Singapore’s DayOne Pushes Ahead With Data Center IPO Tied to TikTok

DayOne Data Centers, a Singapore-based data center operator gearing up for a multibillion-dollar initial public offering in New York, is little known to most U.S. investors. But its business is built on a much better known company: ByteDance.

The TikTok parent company accounts for nearly 70% of DayOne’s revenue, according to two people with knowledge of DayOne’s operations. DayOne, which started as a Chinese data center company’s overseas business unit four years ago, has benefitted greatly from ByteDance’s rapid global expansion through TikTok. But that has also left it extraordinarily dependent on a single customer, which the company has acknowledged creates a significant risk for its business.

DayOne has been sticking with its IPO plans despite investor wariness that has complicated plans by a crop of AI-focused data-center companies to go public. In contrast to those companies, DayOne’s revenue from ByteDance is all for more conventional uses such as serving videos and running e-commerce transactions. None of that ByteDance business is for AI training or inference, according to one of the two people—though DayOne is seeking to build out its AI offerings with other customers, including Oracle.

ByteDance’s rapid global expansion in the past several years has created a huge opportunity for Chinese data center companies to follow it into international markets. A spin-off of Chinese data center giant GDS Holdings, DayOne has provided data centers in Southeast Asia to support TikTok’s booming business. And, when TikTok came under regulatory pressure to host European users’ data within the region, DayOne worked with TikTok on a data center in Finland.

With AI becoming the new driver of global data center demand, DayOne needs to look beyond Chinese customers like ByteDance. DayOne builds data centers and manages power, connectivity and cooling systems, but doesn’t provide computing equipment like servers and chips. U.S. restrictions on the sale of advanced Nvidia AI chips to Chinese companies therefore make it hard for DayOne to work directly with such companies on AI data centers.

Chasing AI

To take advantage of the AI boom, DayOne is focusing more on AI data center projects for Western cloud providers such as Oracle, its second-largest customer, which accounted for 15% of DayOne’s revenue in the first half of the year. DayOne expects its business from Oracle to grow rapidly in the next few years due to the U.S. company’s aggressive AI cloud expansion.

DayOne has also been working with the neoclouds—the new generation of AI cloud providers specializing in providing access to Nvidia chips. In June, Firmus Technologies, an Australia-based neocloud backed by Nvidia, said it was working with DayOne to build a new data center in Batam, Indonesia, with at least 170,000 of Nvidia’s advanced server chips. One of that data center’s end users is expected to be Meta Platforms, which last month announced it would lease capacity from Firmus’ Southeast Asian facilities.

Firmus last week scrapped its $5.5 billion IPO in Australia after investors voiced concern over its $30.6 billion valuation, debt pile and the lock-up arrangement for existing investors. Blackstone-backed data center operator AirTrunk recently postponed the listing of a REIT on the Singapore Exchange that sought to raise about $1.5 billion.

DayOne has said it plans to use the proceeds from its IPO in part to fund development of new data center projects. It is seeking to raise as much as $5 billion. In its prospectus, filed last week, it said its largest customer accounted for 69.2% of its revenue in the first half of this year, and about the same amount last year, but it didn’t name the customer.

For DayOne’s future contracts for 2027, ByteDance accounts for less than 50% of the total commitments, according to one of the two people who identified it as DayOne’s top customer. DayOne’s next three largest customers after ByteDance and Oracle are all non-Chinese companies, according to one of the people.

DayOne could still benefit indirectly from the ambitious growth plans of Chinese companies. To gain access to advanced Nvidia chips without violating U.S. chip export restrictions, many Chinese AI companies rent servers equipped with Nvidia chips from cloud providers. Those servers are installed at data centers located outside China. If such demand from Chinese customers drives cloud providers to work with DayOne to expand their data center capacities, that could translate to more revenue for DayOne.

Geopolitical sensitivities

In its IPO filing, DayOne cited its dependence on a small number of customers as a risk factor and said it is trying to broaden and diversify its customer base. As of September, ByteDance had committed to 838 megawatts in capacity from DayOne’s sites across Malaysia, Thailand and Finland.

The companies’ relationship goes back to 2020, when GDS, DayOne’s former Chinese parent, secured ByteDance as a customer. GDS expanded to Southeast Asia the following year, by which time TikTok was making waves internationally. Its e-commerce business, which allows users to make purchases without leaving the app, was beginning to take off. In 2022, TikTok Shop’s Southeast Asian users more than quadrupled their spending to $4.4 billion, The Information reported.

TikTok also faced challenges due to rising geopolitical tensions between the U.S. and China. As the company battled it out in Washington with lawmakers pushing to ban TikTok over national security concerns, GDS took steps to carve out its own international operations.

It created GDS International to hold its assets and operations outside China and Hong Kong. The international unit took Singapore, a neutral ground, as its headquarters and established its own management team.

In late 2024, GDS International was spun off into an independent company after raising $1.87 billion in Series A and B rounds, which reduced GDS’ stake in the unit to 35.6%. In January 2025, the unit was rebranded as DayOne, and its top three shareholders—Coatue Management, HillHouse and GDS—now each own about 19%.

Last year, DayOne partnered with Nordic data center firm Hyperco to secure sites in the cities of Kouvoula and Lahti in Finland. TikTok is investing a total of 2 billion euros ($2.2 billion) in the two data centers as part of its Project Clover initiative to store European users’ data locally in the region.

Claudia Chong is a reporter covering AI and data centers in Asia. She is based in Singapore and can be reached at [email protected].

Juro Osawa is a reporter covering tech in Asia, from Alibaba and Tencent to startups. He previously worked for The Wall Street Journal. He is based in Hong Kong and can be found on Twitter at @JuroOsawa.