ByteDance will still get about 50% of TikTok US profit after its new owners take control https://t.co/FSWoHCHa4F ...

The TikTok logo on a smartphone in New York. TikTok’s Chinese parent company will likely get about half of the profit from the platform’s US operation even after it sells majority ownership to American investors as part of a deal orchestrated by President Donald Trump, according to people familiar with the matter. ByteDance Ltd. is expected to receive a licensing fee of on all revenue generated from making its algorithm available to the US operating entity as well as a share of the profit in proportion t ...

Core Insights - TikTok, owned by ByteDance, has faced scrutiny in the U.S. over user data security concerns, leading to a complex relationship with the government [1][14] - An executive order by President Trump has approved the sale of TikTok's U.S. operations to an American investor group, valuing the U.S. business at approximately $14 billion, with potential future valuation exceeding $60 billion [3][4] Group 1: Ownership and Valuation - A consortium of investors, including Oracle, Silver Lake, and Andreessen Horowitz, is expected to oversee TikTok's U.S. operations, holding an 80% stake, while Chinese stakeholders will retain the remaining shares [5][6] - The deal is part of a framework agreement between the U.S. and China, with President Xi Jinping's approval for the transaction [4][5] Group 2: Operational Changes - Oracle is anticipated to manage TikTok's security and safety measures, replicating and securing a new U.S. version of the algorithm, which ByteDance will not have access to [9][10] - Reports suggest that once the deal is finalized, the TikTok app may be discontinued in the U.S., requiring users to transition to a new platform, though details about this platform remain unclear [11] Group 3: Historical Context - The timeline of TikTok's relationship with the U.S. government includes various legal battles and negotiations, starting with Trump's executive order in August 2020 to ban transactions with ByteDance [14][15] - TikTok has consistently denied posing a security threat, asserting compliance with local laws regarding data storage in the U.S. [16]

Market Overview - US stocks experienced mostly gains on Friday, with the Dow Jones Industrial Average rising approximately 0.4% and the S&P 500 gaining 0.15%, while the Nasdaq Composite fell 0.16% after three consecutive days of losses [1] - The market's initial rise was influenced by the August Personal Consumption Expenditures (PCE) index, which showed a year-over-year increase of 2.9% and a month-over-month increase of 0.2%, aligning with economists' expectations [3] Consumer Sentiment - The University of Michigan's consumer sentiment survey indicated that Americans were more pessimistic about the US economy than anticipated in September, leading to a pullback in stocks from earlier gains [2] Trade Policies - President Trump announced a potential 100% tariff on imports of branded drugs for pharmaceutical companies not building manufacturing plants in the US, causing shares of drugmakers in Europe and Asia to decline [4] - Additional tariffs on imports of heavy trucks and certain furniture categories are set to take effect on October 1, contributing to market uncertainty amid concerns about the sustainability of the AI boom and the risk of a US government shutdown [5] Corporate Developments - Trump approved a deal to spin off TikTok's US operations from China's ByteDance, with a proposed price of $14 billion, which was viewed as undervaluing the company, estimated to be worth around $40 billion [6]

Market Performance - US stocks experienced a rise on Friday, with the Dow Jones Industrial Average increasing by approximately 0.6%, the S&P 500 gaining 0.5%, and the Nasdaq Composite ticking up by 0.2% after three consecutive days of losses [1] Inflation Data - The Personal Consumption Expenditures (PCE) index for August showed a year-over-year increase of 2.9% and a month-over-month rise of 0.2%, aligning with economists' expectations despite inflation remaining above the Federal Reserve's 2% target [2] Trade Tariffs - President Trump announced a potential 100% tariff on imports of branded drugs for pharmaceutical companies not building manufacturing plants in the US, causing shares of drugmakers in Europe and Asia to decline [3] - New tariffs on imports of heavy trucks and certain furniture categories will take effect on October 1, adding uncertainty to markets already concerned about the sustainability of the AI boom and the risk of a US government shutdown [4] Corporate Developments - Trump approved a deal to spin off TikTok's US operations from China's ByteDance, with a proposed price of $14 billion, which was viewed as undervaluing the company, estimated to be worth around $40 billion [5]

Regulatory Landscape - U S law mandates a ban on ByteDance-owned apps including CapCut, Gauth, Lemon8, and Coze [1] - The ban is contingent on ByteDance not selling these apps as part of the TikTok deal announced by President Trump [1]

President Trump signing an executive order meant to keep Tik Tok running in the United States. Vice President JD Vance says the deal values Tik Tok's US business at 14 billion and under the terms a new joint venture company will oversee Tik Tok in America with China based Bite Dance retaining less than a 20% stake. Uh but there's been no indication yet that the Chinese government has made uh the legal changes with the algo and all that necessary for a deal to go through.Joining us uh is our own Aean Jeffs a ...

President Trump signing an executive order meant to keep Tik Tok running in the United States. Vice President JD Vance says the deal values Tik Tok's US business at 14 billion and under the terms a new joint venture company will oversee Tik Tok in America with China based Bite Dance retaining less than a 20% stake. Uh but there's been no indication yet that the Chinese government has made uh the legal changes with the algo and all that necessary for a deal to go through.Joining us uh is our own Aean Jeffs a ...

Core Points - The US government has authorized TikTok to continue operations in the country under a new joint venture structure, requiring changes to its US operations and ownership [1][5] - The joint venture will be valued at approximately $14 billion, with US investors holding a majority stake [1][6] - ByteDance, TikTok's parent company, will retain less than 20% ownership and will have limited influence on the board [2] Company Structure and Governance - The new joint venture will be headquartered in the US and will have a seven-member board, with ByteDance allowed to appoint only one director [2] - The board will consist of individuals with expertise in national security and cybersecurity [2] Data Security and Compliance - Oracle has been designated as TikTok's security provider for US operations, hosting all US user data on its infrastructure [3] - The agreement ensures that sensitive information is protected from foreign access and complies with the Protecting Americans from Foreign Adversary Controlled Applications Act [3] - Control over TikTok's US algorithm, source code, and content moderation will be transferred to the new American-led company [3] Oversight and Regulation - All recommendation models using US user data must be retrained and monitored by approved US security entities, with continuous oversight on software updates and data transfers [4] - The Attorney General has been instructed to delay enforcement of the Act for 120 days to facilitate the transfer process [4] Economic Impact - The White House estimates that TikTok's continued operations could generate around $178 billion in US economic activity over four years and support thousands of jobs [6]

Core Insights - The approval of a deal by U.S. President Donald Trump could allow TikTok to continue operating in the U.S., but China's response has been notably quiet, leaving uncertainty about the app's future [1][2] Group 1: Deal Structure - The deal involves the creation of a new joint-venture company to oversee TikTok's U.S. business, data, and algorithm, with ByteDance retaining less than a 20% stake [3] - This arrangement is intended to comply with U.S. national security laws that require ByteDance to divest from TikTok's U.S. operations to avoid a ban [3] Group 2: Company Operations - ByteDance is expected to establish a new U.S. company focused on e-commerce, brand advertising, and managing relationships with TikTok's international operations [4] - Details regarding the division of TikTok U.S.'s operations into two companies remain unclear, as reported by Chinese media [2]