TikTok CEO Shou Chew told employees about the transaction in a memo on Thursday. CNN was able to view the memo which said, "We have signed agreements with investors regarding a new TikTok U.S. joint venture, enabling over 170 million Americans to continue discovering a world of endless possibilities as part of a vital global community."
At one time, it seemed that the banning of TikTok in the U.S. was a sure thing
There had been strong bipartisan support to ban TikTok in the U.S. because of concern that ByteDance was collecting the personal data of American children creating a TikTok account. The same government officials were concerned that ByteDance was including propaganda from the Chinese government in the TikTok feeds of America's youngsters. As for the all-important algorithm, which is the recommendation engine that powers TikTok's "For You" page and controls what TikTok subscribers see in their feeds, ByteDance will keep the source code and license a copy of it to the new U.S. entity.
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The deadline for a TikTok sale had been extended numerous times during the second Trump presidency. In September, after the Trump Administration made a deal with China to transfer control of TikTok's U.S. operations to a group of American investors, President Trump signed an executive order stating that this constituted a qualified divestiture delaying the enforcement of the deal's deadline for 120-days.
Americans spent more time daily on TikTok than on YouTube, Instagram, and Facebook. | Image credit-QuantumRun
The deal is expected to close next month
Chew says that more work remains before the sale can be finalized but a closing date of January 22nd, 2026, is the target. ByteDance and TikTok have agreed to the terms of the deal. Under these terms, a new American entity named TikTok USDS Joint Venture LLC will be created.
Three companies will together own 50% of TikTok USDS Joint Venture LLC:
Oracle, the U.S. firm owned by billionaire Larry Ellson, a friend of the president, also is the company charged with storing TikTok's data in the U.S.
Silver Lake, a U.S. private equity firm that has connections to the tech and media industries.
MGX, a firm located in Abu Dhabi (UAE), whose role in the American group is to provide funding.
Other equity partners include:
Affiliates of Existing Investors (30.1%) are U.S.-based investment firms (like General Atlantic and Susquehanna) that already invested in the global ByteDance company.
ByteDance (19.9%) is the original Chinese parent company which will retain a minority stake. That stake is kept under 20% to prevent TikTok USDS Joint Venture LLC from being classified as "foreign controlled."
TikTok is a social media and financial powerhouse
There is no denying that TikTok is a powerhouse as its 1.59 billion monthly active users globally in early 2025 made it the fifth largest social media platform globally. In the U.S., there are 135.79 million TikTok users, the most of any country. Surprisingly, Indonesia is second with 107.07 million users. It also is a financial powerhouse as last year it generated $23 billion in global revenue. Advertising accounted for 77% of the top line.
If you're curious about the demographic most attracted to TikTok, 71% of all users are in the 18-34 age range, a group made up of 1.05 billion individuals. If you are older than 45 and you use the app, you are a rarity. Such users make up just 3.6% of total users. As for gender distribution, 55.7% of TikTok users are male with woman making up 44.3%.
U.S. TikTokers spend an average of 52 minutes each day on the platform. Americans spend an average of 48 minutes each day on YouTube, 35 minutes on Instagram and 30 minutes on
Alan, an ardent smartphone enthusiast and a veteran writer at PhoneArena since 2009, has witnessed and chronicled the transformative years of mobile technology. Owning iconic phones from the original iPhone to the iPhone 15 Pro Max, he has seen smartphones evolve into a global phenomenon. Beyond smartphones, Alan has covered the emergence of tablets, smartwatches, and smart speakers.
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