An internal communication indicates that the algorithm will undergo retraining using US user data following the conclusion of the deal in January.
An internal communication indicates that the algorithm will undergo retraining using US user data following the conclusion of the deal in January.
TikTok has reached an agreement to divest enough of its US operations to comply with the divest-or-ban regulation, as initially disclosed by Axios, The Hollywood Reporter, and CNBC. As per a communication from CEO Shou Zi Chew to staff (published in its entirety below) on Thursday, they aim for a closing date of January 22nd, 2026. After the deal is finalized, he states that ownership proportions in TikTok USDS Joint Venture LLC will be as follows:
Notably, the U.S. joint endeavor will be 50% owned by a group of new investors, comprising Oracle, Silver Lake, and MGX each holding 15%; 30.1% will be owned by affiliates of certain existing investors in ByteDance; and ByteDance will retain 19.9%.
After TikTok temporarily ceased operations in the US in January, President Donald Trump provided TikTok with a series of extensions to negotiate a deal for divesting a stake in its US operations. The US and China ultimately agreed upon a “framework” for a deal in September, resulting in yet another extension that concluded on December 16th.
The correspondence notes that the new joint venture will manage its algorithm, “retraining the content recommendation algorithm on U.S. user data to guarantee that the content feed is devoid of external interference,” along with content moderation, data security, and the rollout of the US version of the app and platform.
Update about our U.S. operations
I am excited to announce some wonderful news. We have finalized agreements with investors related to a new TikTok U.S. joint venture, allowing over 170 million Americans to continue exploring a world of endless possibilities within a vital global community.I wish to take a moment to express my gratitude for your ongoing commitment and hard work. Your contributions enable us to function at peak efficiency and will ensure that TikTok continues to advance and flourish in the U.S. and globally.
With these agreements finalized, we must prioritize our focus as it has always been—squarely on serving our users, creators, businesses, and the global TikTok community.
There remains further work to be accomplished as we approach the closing date of January 22, 2026. During this period, we will keep you informed about the process and additional details.
In the interim, I have provided key terms of the agreements below.
Shou
ByteDance and TikTok have established binding agreements with three managing investors, Oracle Corporation, Silver Lake, and MGX, to create a new TikTok U.S. joint venture called TikTok USDS Joint Venture LLC. Under the Executive Order issued by U.S. President Donald J. Trump on September 25, 2025, the agreements stipulate that the U.S. joint venture will be predominantly owned by American investors, managed by a new seven-member board of directors with a majority of American members, and subject to stipulations that safeguard Americans’ data and U.S. national security.
Specifically, the U.S. joint venture will be 50% held by a consortium of new investors, including Oracle, Silver Lake, and MGX each with a 15% share; 30.1% will belong to affiliates of specific existing investors of ByteDance; and ByteDance will maintain a 19.9% ownership.
Through extensive security measures, more than 170 million Americans will continue to discover, innovate, and connect on the platform, experiencing the same environment as today. Advertisers will still reach global audiences without any impact.
The U.S. joint venture will oversee U.S. data protection, algorithm integrity, content moderation, and software assurance. It will hold exclusive rights and authority to ensure that content, software, and data pertaining to American users are protected. A trusted security partner will be tasked with auditing and certifying adherence to the agreed upon National Security Terms, with Oracle designated as the trusted security partner upon transaction completion.
The U.S. joint venture will supervise:
Data Protection: ensuring the safety of sensitive U.S. user data, stored in a reliable and secure cloud environment in the United States managed by Oracle.
Algorithm Integrity: retraining the content recommendation algorithm on U.S. user data to guarantee the content feed is free from external influence.
Content Moderation: ultimate authority over reviewing and approving all content moderation and related policies in the United States.
Software Assurance: overseeing the deployment and integrity of the U.S. application software and platform.
The transaction must be finalized no later than 120 days from the date of the Executive Order. Upon closing, the U.S. joint venture, rooted in the existing TikTok U.S. Data Security (USDS) organization, will operate as an independent entity with oversight over U.S. data protection, algorithm integrity, content moderation, and software assurance, while TikTok global’s U.S. branches will handle global product interoperability and specific commercial pursuits, such as e-commerce, advertising, and marketing.
Update, December 18th: Added insights from the memo and its complete text.
