Impending U.S. TikTok Ban and Impact on Meta Platforms

Investments
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TikTok prepares US-Specific App ahead of forced sale, the Information reported

  • TikTok is developing a new version of its app for U.S. users, targeting a September 5 launch, the Information reported.
  • This move comes as President Trump says the U.S. “pretty much” has a deal and will begin talks with China this week about the app’s future.
  • Users will need to switch to the new app, though the existing version will remain usable until March 2026.

https://www.reuters.com/world/china/tiktok-building-new-version-app-ahead-expected-us-sale-information-reports-2025-07-06/

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Treasury Secretary Says Framework Deal Reached for TikTok’s US Stay

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TikTok may keep ByteDance’s algorithm post-sale, Financial Times reported

  • TikTok would still be able to access ByteDance’s algorithm once it’s sold, Financial Times reported citing people familiar with the matter.

  • Trump has once again extended the dateline for a TikTok ban to December.

  • Yesterday, Trump’s administration said a framework deal for the sale of TikTok had been reached with China.

Assessment

If true, the tailwind for Meta Platforms would likely be limited, since TikTok could continue operating normally with its algorithm intact.

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Trump and Xi failed to come to a final agreement on TikTok but made progress towards a deal

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TikTok’s US algorithm will be trained from ground up, a White House official said

TikTok’s new owners will lease a copy of its algorithm from ByteDance and retrain it “from the ground up”, Bloomberg reported citing a White House Official.

https://www.bloomberg.com/news/articles/2025-09-22/tiktok-s-algorithm-to-be-secured-by-oracle-in-trump-backed-deal

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TikTok’s newly established US entity experienced massive outage on Sunday

  • The entity blamed the issues which prevented millions of Americans from posting videos, accessing their feeds or seeing up-to-date engagement metrics to a data center power disruption.
  • TikTok USDS Joint Venture LLC, which was formed just last week to oversee content algorithms and data security said the issues have been resolved but users may still experience bugs.

https://www.bloomberg.com/news/articles/2026-01-27/tiktok-us-blames-power-outage-for-glitches-after-landmark-deal

Assessment
This marks a rocky start for TikTok US and may push users to its rivals such as Instagram Reels.

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Consortium lead by Oracle, Silver Lane, MGX buys majority of TikTok U.S. “data & algorithm operation” - ending TikTok divesture saga

  • On January 23, 2026 it was announced that a new majority American owned Joint Venture will be responsible for TikTok U.S. data security & algorithm. As reported earlier, it will lease a copy of Bytedance content recommendation algorithm to retrain a new algorithm on U.S. data. Bytedance will retain a 19.9% share.
  • The JV complies with Trumps executive order signed on September 25, 2025, which approved the TikTok divesture plan and outlined conditions to be met. As it’s within the presidents responsibility to set those conditions (outlined by law and highlighted by the supreme court (p.5) in it’s Jan 2025 decision) the deal concludes the forced divesture of TikTok.
  • The deal allows interoperability which provide U.S. users with a global TikTok experience, ensuring U.S. creators can be discovered and businesses can operate on a global scale.
  • The new JV will not own certain commercial activities like advertising, e-commerce and marketing. It is unclear which compensation or profit sharing investors in the JV will receive but in September 2025 briefly after the order was signed, there was speculation, that TikToks Chinese parent company will get at least 50% of profits. At that time vice-president JD Vance said the deal valued Tiktok U.S. at $14 billion.
  • According to an internal TikTok memo as of December 18, 2025 the deal would go through.

Assessment

In my opinion the deal looks quite sophisticated and well made esp. from TikToks standpoint.
Consequently i believe that the divesture in that fashion is somewhat negative for Meta.
Most crucially the way the deals ensures interoperability with TikTok global and continuity with advertising should lead to restored confidence of advertisers in TikTok. In addition advertisers finally have predictability of what’s next for TikTok. This could lead to some advertisers dollars shifting again to TikTok and some short-term headwinds for Meta.

Overall i believe depending on the exact conditions of the deal, it might have been a win for TikTok as it might be able to retain the majority of upside and some control, while satisfying U.S. regulatory requirements and security concerns. Given how sophisticated Tiktok is, i believe their continued management of advertising, e-commerce etc. is a downside for Meta as it increases the odds that TikTok remains a strong competitor.

If we don’t have this already we should have a closer look how large TikToks advertising business is in the United States. A recent Bloomberg articles says the most conservative estimates put it on $10billion revenue in the U.S., but not profitable yet. According to the same article, Bytedance was on track to generate a mind-blowing $50 billion in profits globally in 2025. Close to Meta’s $60 billion.

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