So, Oracle (ORCL +3.27%) popped a bit this morning – a three percent lift, if you’re keeping score – and it all revolves around TikTok, which, let’s face it, is a phenomenon that continues to baffle anyone over the age of thirty. Apparently, a memo circulated internally at TikTok, penned by their CEO, confirmed a deal that’s been kicking around for quite some time. It’s a bit like watching a particularly complicated game of international chess, only with more dancing teenagers.
The upshot is that Oracle, alongside Silver Lake (a private equity firm, which sounds terribly sophisticated) and MGX, an Abu Dhabi-based entity, now collectively own 45% of TikTok U.S. It’s a rather unusual alliance, a bit like finding a badger sharing a picnic basket with a flamingo. The remaining 20% stays with ByteDance, TikTok’s Chinese parent company, bringing the total non-Chinese ownership to 80%. It’s a carefully constructed arrangement, designed, one assumes, to satisfy everyone – a feat rarely accomplished in the world of high finance.
What Did This Memo Actually Say?
According to Business Insider, this memo (which surfaced on Thursday, as these things often do) confirms the establishment of “TikTok USDS Joint Venture LLC.” A mouthful, isn’t it? It’s all in compliance with an Executive Order signed by President Trump way back in 2025 (time really does fly). The venture is “majority American owned,” which is the key phrase, and will operate with “safeguards” to protect national security. These safeguards involve data protection, algorithm security, content moderation, and software assurances. It all sounds impressively robust, like a digital fortress.
The Chinese side of this operation is represented by a ByteDance subsidiary called “TT Commerce & Global Services LLC.” The board has appointed Adam Presser to run the whole show. Mr. Presser, it turns out, has been with TikTok for nearly four years and previously headed up Warner Bros. Entertainment’s operations in China, Austria & New Zealand. A remarkably diverse portfolio, if I may say so. It’s a small world, isn’t it?
What Does This Mean for Oracle Shareholders?
Well, that’s the million-dollar question, isn’t it? At this early stage, it’s difficult to say definitively. Oracle has been circling TikTok U.S. for a while now, so it’s safe to assume they believe this is a good thing. One tends to pursue things one believes will be beneficial. But assessing the true impact requires a bit more time and observation. It’s a bit like trying to predict the weather – you can make an educated guess, but you’re rarely entirely correct.
Currently, Oracle trades at 33 times trailing earnings, with a forecast growth rate of 23%. Not outrageous, but not exactly a bargain either. However, one must also consider that Oracle carries a rather substantial $112 billion in net debt. That’s a lot of money, enough to buy a small country, perhaps. When you factor that in, using an enterprise value-to-earnings ratio, the valuation becomes considerably higher. So, while the TikTok deal might provide a boost, it’s important to remember the bigger picture. It’s a complex situation, like most things in the world of finance. And, as I’ve learned over the years, simple answers are rarely correct.
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2026-01-26 19:22