TikTok reaches agreement on Oracle-led US ownership plan

• TikTok has agreed to an Oracle-led plan to move its US business into a new joint venture.
• ByteDance’s stake would shrink, but questions over control and compliance remain.

For years, the future of TikTok in the United States has hinged on a single, unresolved problem: how the company could operate in America while easing concerns about its ties to a Chinese parent company.

On Thursday, that issue took a major step toward resolution. TikTok confirmed it has agreed to a sale structure that would place its US operations under a newly formed joint venture led by Oracle and other investors, a plan first outlined by the White House months ago. The move could spare the app from a nationwide ban that has hung over it for years.

TikTok Chief Executive Officer Shou Chew told staff that the company and ByteDance, its Chinese owner, had signed binding agreements to form a US-based entity majority-owned by American and global investors, according to Bloomberg. Chew said he was “pleased to share some great news” and confirmed that accords with Oracle, Silver Lake Management, and MGX were now in place. The deal is expected to close on Jan. 22, 2026, though Chew added that “there’s more work to be done” before then.

Chinese regulators have not yet said whether they will approve the transaction.

If completed, the new US entity will run TikTok independently in the United States and take responsibility for data protection, content moderation, and algorithm security. Chew also said it would be governed by a seven-member board with a majority of American directors. Following the announcement, Oracle’s stock jumped in after-hours trading.

Why this matters

TikTok’s US business is not a niche operation. The app is one of the most widely used social media platforms in the country, with more than 170 million American users. That means more than half of US adults use TikTok, and even higher percentages among younger people. The platform has become a major source of culture, advertising, and even news; Pew Research data shows the percentage of US adults who regularly get news from TikTok has grown steadily in recent years.

That popularity is part of what has made the situation so politically charged. US lawmakers have raised national security concerns for years, arguing that ByteDance’s ties to China could give Beijing access to sensitive data on American users or influence what people see on the app. These concerns prompted Congress to pass the Protecting Americans from Foreign Adversary Controlled Applications Act in 2024, which requires certain foreign-owned platforms to divest or face a ban.

Under the terms of the proposed deal, TikTok’s US operations are valued at about $14 billion, a figure below some outside estimates of its market worth, but one that reflects the regulatory risk the company faces.

American and global investors — Oracle, Silver Lake, and MGX — would collectively own half of the new venture. Affiliates of existing ByteDance investors would hold another 30.1%, and ByteDance itself would retain a 19.9% stake.

The division means ByteDance’s role would shrink but not disappear. That has drawn criticism from some lawmakers who argue even limited involvement could undermine the spirit of the national security law. Critics have noted that the agreement may still leave gaps in separating TikTok’s operations from ByteDance, especially around its recommendation algorithm.

Algorithm and influence

At the centre of many of these debates is TikTok’s recommendation system. The “For You” feed — which uses machine learning to decide what content to show users — is widely credited with driving the app’s rapid growth and stickiness. But it has also sparked concern because it determines what people see, including political or news-related content. Studies have suggested that TikTok’s recommendations can influence how users perceive political issues, though research is ongoing.

Under the proposed deal, ByteDance would license a version of its recommendation technology to the new US entity. That system would then be retrained using US data stored and protected by Oracle, which is intended to limit foreign access. Still, questions remain about how much control ByteDance would retain over the underlying technology and whether the arrangement meets the legal requirement to sever operational ties.

Oracle’s role echoes an earlier effort to address national security concerns known as Project Texas, which proposed using Oracle to oversee US user data. That plan was rejected by the US government in the past as insufficient, but the current deal builds on the concept with more structural safeguards.

Political and legal backdrop

The sale plan comes after years of shifting political and legal battles. A law requiring TikTok’s divestiture went into effect in 2025; at one point, the app was even removed from US app stores due to enforcement of that law, only to be reinstated after executive action delayed enforcement.

Surveys have shown widespread public concern about TikTok’s ownership. In one national poll, a large majority of Americans said they were wary of Chinese ownership and supported either a forced sale or a ban. Concerns included potential data misuse, political influence, and algorithmic control.

Even with the sale plan now in motion, its final outcome is not guaranteed. Chinese regulatory approval is required for the transaction to close, and details of the governance and control arrangements are still under negotiation.

What it means going forward

Beyond resolving a long-standing legal requirement, the deal could set a precedent for how platforms linked to foreign companies are treated in the United States. For users, it could mean continued access to the app without disruption. For policymakers, it represents a test of whether national security concerns can be addressed through ownership restructuring rather than outright bans.

At the same time, the broader questions raised by TikTok — about data, influence, and platform power — remain unsettled. The app’s massive reach, especially among younger audiences, means it will continue to be a focal point for discussions about privacy, regulation, and digital culture in the United States.

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