The TikTok ban will remain in a holding pattern. The White House is indicating President Donald Trump will again delay enforcement of a law that would bar the hit video app in the U.S. unless its Chinese parent company sells. Social media competitors like Meta Platforms, Reddit and Snap could benefit from the uncertainty, according to stock analysts.
TikTok remains available for Americans under a temporary reprieve from a 2024 law that bans the short-video app unless its parent company ByteDance divests ownership. Trump has twice delayed enforcement of the ban for 75 days, most recently in early April. The deadline for that extension is tomorrow. White House press secretary Karoline Leavitt said Tuesday that Trump will sign an executive order giving TikTok 90 more days, NBC News reported.
The Trump administration is working to find a buyer to allow TikTok to remain in operations. But the rumor mill has cooled since early April. Early that month, Trump was reportedly briefed on a plan dubbed "TikTok America."
The proposal would bring new American investors in and dilute ByteDance's ownership of TikTok in the U.S. to below 20%. Oracle, meanwhile, would secure TikTok's U.S. user data. Amazon and AppLovin also reportedly made their interest known to the White House at the time.
Any plan will require ByteDance agreeing to sell. It would also likely require approval from the Chinese government. Trump's April 2"Liberation Day" tariff announcement disrupted the TikTok negotiations, according to a New York Times report.
What Does TikTok Ban Mean For Meta, Google?
TikTok, which launched in the U.S. in 2016, has more than 170 million regular U.S. users. It competes against Facebook parent Meta Platforms, Google parent Alphabet Snapchat owner Snap, Pinterest, Reddit and others for users and advertising dollars.
Research firm eMarketer estimated that TikTok last year collected $10.4 billion in U.S. ad revenue.
Those users and revenue could be up for grabs. Meta presented data in a federal court hearing in April that usage of Facebook and Instagram spiked during the short period TikTok was shut down by law in the U.S. in late January.
Morningstar analysts wrote in a recent research report that a TikTok sale after a longer period of uncertainty is the most likely outcome.
"We believe that the market is underappreciating the potential positive impact on our social media coverage as advertisers, creators, and users navigate this period of continued uncertainty," Morningstar analyst Malik Ahmed Khan wrote on June 11.
The threat to social media stocks from a forced sale of TikTok would vary based on the buyer, according to Morningstar. Amazon and Microsoft would pose a bigger potential threat than a private investor group.
Chinese export control will probably block TikTok's highly-valuable content recommendation algorithm from being included in a sale. That means any buyer will have to rebuild the algorithm, Ahmed Khan wrote, "a complex task that stands to introduce significant execution risk."
Could Trump Be Forced To Take Action On TikTok?
The law to ban TikTok had bipartisan support in Congress last year. Lawmakers cited national security concerns from TikTok's ownership by a China-based company.
Some lawmakers in Washington D.C. have grown tired of the delays, Axios recently reported, but they are yet to take action to force either a sale or enforcement of the law. Some analysts think the delays could force a legal challenge, MarketWatch reported, but it is unclear what parties could have legal standing to bring a lawsuit.
TikTok, for its part, is "absolutely confident" in a resolution, a company executive said Tuesday at the Cannes Lions advertisers conference in France.
