TikTok sets up US unit under Trump deal but leaves core business with ByteDance

January 23, 2026 - 09:17

The popular video-sharing platform TikTok has formally created a new U.S.-based corporate entity, TikTok Global, as a key component of a preliminary deal to address national security concerns raised by the Trump administration. This move establishes a separate American company with substantial investment from U.S. firms Oracle and Walmart, who would collectively hold a majority stake in the new venture.

However, the arrangement stops short of the full divestiture initially demanded by U.S. officials. TikTok's parent company, the Chinese firm ByteDance, will retain an 80% ownership stake in the core TikTok application and its prized recommendation algorithm. The new U.S. entity is primarily tasked with securing all American user data, which will be stored on Oracle's domestic cloud servers, with the tech giant also providing critical security oversight.

The deal has drawn immediate criticism from China hawks and lawmakers in Washington, who argue it fails to sufficiently sever the app's operational ties to China and potential influence from the Chinese government. Proponents contend the structure creates a powerful American-led gatekeeper for data security. The creation of TikTok Global marks a significant, yet controversial, step in the app's fight to continue its operations for millions of American users amidst escalating geopolitical tensions over technology and data sovereignty. The agreement still requires final approval from U.S. regulators.