ByteDance’s TikTok has signed a deal to divest its U.S. operations to a U.S. venture controlled by American investors, according to an internal memo seen by Axios, The Associated Press, and Reuters. TikTok CEO Shou Zi Chew said in the memo that the deal should close on January 22. Oracle, Silver Lake, and MGX are named in the reports as three big investors in the TikTok U.S. venture (TikTok USDS Joint Venture LLC), with a collective 45% stake (15% each). ByteDance will still hold 19.9% of the resulting company, while nearly 30.1% will be held by existing ByteDance investors. It’s unclear who the remaining investors are.
TikTok U.S. will have a seven-member board of directors, six of which will be American. ByteDance will control the other seat. The new company will host the data of U.S. users on servers run by Oracle. The algorithm powering the new app will be retrained on U.S. user data to “ensure the content feed is free from outside manipulation.” TikTok U.S. will also be responsible for content moderation on the platform.
While TikTok U.S. will handle user data, the new algorithm, content moderation, and software assurance, ByteDance will still handle the revenue. A portion of that will be shared with the U.S. venture, though figures have not leaked. Also, it’s unclear how much money Oracle, Silver Lake, and MGX are paying for their shares of TikTok U.S. The new company will be valued at around $14 billion, according to figures Vice President JD Vance mentioned in September.
What the TikTok sale means for users
For most of 2025, TikTok has been available to U.S. users because President Trump issued several executive orders that delayed the ban TikTok risked under a U.S. law passed last year. President Trump pushed for a TikTok ban in 2020. Last year, he credited TikTok for helping him win the election.
Under the “Protecting Americans from Foreign Adversary Controlled Applications Act,” TikTok would have had to sell its operations to a U.S. entity to continue serving American users or risk a ban. The TikTok app was briefly unavailable to users in January, the initial deadline. U.S. lawmakers focused on a few key TikTok issues: the algorithm that dictates what short-form videos a user sees in the app, and the location of the data for U.S. users. The government wanted a U.S. venture to handle the U.S. data and ensure that a foreign entity could not manipulate public opinion with the algorithm. These matters should be settled under the leaked terms of the deal.
TikTok users and creators should not experience any issues going forward. The TikTok app should continue to work uninterrupted until the deal finalizes, though it’s unclear when the data migration and algorithm changes are set to happen. The U.S. venture will not create a brand-new U.S.-only TikTok app. “With these agreements in place, our focus must stay where it’s always been — firmly on delivering for our users, creators, businesses, and the global TikTok community,” Chew wrote in the memo, signaling TikTok would still control software development for the app. As of this writing, over 170 million Americans use TikTok.
