Profit trap or growing pains? The "double-edged sword" dilemma of Telegram and TON

Telegram’s recent report card looks impressive, but it hides a number that makes investors’ scalps tingle—revenue hitting a new high, yet profits turning into losses. The underlying logic isn’t complicated, but it reveals the deep risks brought by the high volatility of the crypto ecosystem. Is this the strategic binding of Telegram and TON bearing fruit, or is it laying a bigger minefield?

Revenue Hits Record High, but Profit Turns Negative—The Transmission Effect of TON Asset Fluctuations

According to Financial Times, Telegram delivered a stellar performance in the first half of 2025: revenue reached $870 million, up 65% year-over-year, nearly doubling from $525 million in the same period of 2024. Operating profit even approached $400 million.

But the biggest contrast appears here—despite strong operating profits, Telegram recorded a net loss of $222 million. This isn’t due to slowing user growth or a flawed business model, but a more tangible reason: the significant devaluation of its holdings in TON tokens.

Let’s break down Telegram’s revenue structure. Advertising income grew 5% to $125 million, premium subscription revenue soared 88% to $223 million, both growing as expected. But the real driver of revenue explosion is the exclusive agreement with the TON ecosystem—TON became the sole blockchain infrastructure for Telegram’s mini-program ecosystem, contributing nearly $300 million in revenue.

This is the key to Telegram’s profit turning point. In 2024, the company achieved its first annual profit, reaching $540 million, with total revenue of $1.4 billion. Half of this revenue came from “partnerships and ecosystem”—where TON’s contribution was significant.

But at a cost. Due to the continued downturn in the crypto market in 2025, TON token prices fell more than 73% at their lowest point. According to the latest data, TON’s current price is $1.57, with a circulating market cap of $3.82 billion. The TON tokens, once seen as heavyweight assets, when revalued, directly impacted Telegram’s income statement—this is the “penetration effect” of virtual asset volatility on traditional financial reports.

In other words, Telegram faces a sharp profit paradox: its core business is growing strongly, but asset-side losses directly erode this growth’s shine.

Behind the Token Sell-off: Decentralization Promise vs Short-term Cash-out Doubts

More controversial is the report that Telegram has offloaded TON tokens on a large scale, with sales exceeding $450 million, far surpassing TON’s current circulating market cap by over 10%. This immediately sparked community dissatisfaction: Is Telegram preparing for long-term decentralization, or is it cashing out opportunistically?

In response to these doubts, Manuel Stotz, Chairman of the TON treasury company TONX, issued an official statement. He emphasized that all TON tokens sold by Telegram are subject to a four-year phased unlocking schedule, meaning these tokens cannot be traded on the secondary market in the short term, preventing immediate sell pressure.

More critically, the identity of buyers. According to Stotz, the main buyers are long-term investment institutions like TONX. These buyers purchase tokens for long-term holding and staking, not for speculation and quick turnover. Under this logic, Telegram’s token sales appear more like an asset restructuring rather than a “backstabbing” cash-out from investors.

There are deeper considerations behind this. Pavel Durov, Telegram’s founder, publicly stated as early as 2024 that the team would keep the proportion of TON held by Telegram below 10%. Excess holdings would be sold at a slight discount below market price to long-term investors, with lock-up and vesting periods set to prevent short-term sell pressure. The core goal of this approach is to practice decentralization—preventing TON token over-concentration in Telegram’s hands that could lead to price manipulation risks.

According to Stotz, Telegram’s net holdings of TON tokens did not decrease significantly after trading—in fact, they may have increased. This is because the company used the sale of existing tokens to fund lock-up allocations, while continuing to earn new TON income from advertising revenue sharing and other business activities. Overall, their holdings remain high.

Thus, this sell-off is essentially a balancing act between profit pressure and ecosystem responsibility. Token sales have indeed raised funds and optimized asset structure, but they also verify the authenticity of the decentralization promise—not for short-term cashing out, but for the long-term health of the ecosystem.

IPO Window and Business Model: Where Is the Sustainability of Profit Growth?

Telegram’s IPO plan is at a critical juncture. Since 2021, the company has raised over $1 billion through multiple rounds of bond financing, and in 2025, it issued another $1.7 billion in convertible bonds, attracting international institutions like BlackRock and Mubadala.

What makes this financing special is the IPO conversion clause of the convertible bonds: if the company goes public before 2030, investors can redeem or convert at about 80% of the IPO price, effectively a 20% discount. In other words, these investors are betting on Telegram’s successful IPO and expecting a valuation premium at listing.

Currently, Telegram has prepaid or repaid most of the bonds due in March 2026. CEO Durov publicly stated that the old debt has been mostly settled, posing no current risk. The main debt pressure now comes from the convertible bonds due in 2030, leaving a relatively wide window for listing.

But this window is closing. Many investors expect Telegram to seek an IPO around 2026-2027, converting debt to equity and opening new financing channels. Missing this window would mean the company faces long-term debt interest pressures and loses the best opportunity for equity financing.

When evaluating Telegram’s IPO value, investors focus on two issues: first, profit sustainability. With about 1 billion monthly active users and 450 million daily active users, the large user base offers commercial imagination. But can the rapid growth of the past two years continue? Especially when the prices of virtual assets like TON fluctuate, will profits continue to be impacted?

Second, Durov’s decision-making autonomy as the sole shareholder. He emphasizes that creditors are not involved in corporate governance, meaning Telegram might sacrifice some short-term profits to enhance long-term user stickiness without being constrained by short-sighted shareholders. This “delayed gratification” strategy aligns with his consistent product philosophy and is central to telling the growth story to investors.

However, the path to listing still faces uncertainties. Legal proceedings against Durov in France are ongoing, and this investigation could pose a listing obstacle. Telegram has also acknowledged this risk in communications with investors, making the timing of the IPO uncertain.

Ultimately, Telegram’s binding with TON is a double-edged sword. On one hand, this deep involvement brings new revenue streams and product competitiveness, driving rapid profit growth; on the other hand, the volatility of the crypto market directly transmits to financial statements, posing a potential threat to profit stability. When assessing its IPO value, investors must consider both growth potential and risk exposure—the answer to this question may ultimately be given by the market.