TikTok may well remain an uninvestable security, but its newest survival strategy in the U.S. is having ripple effects throughout public technology stocks and the ETFs that track them.
The short-video platform has reportedly signed binding agreements to form a new U.S.-based joint venture with a group of American and global investors, including Oracle Corp. (NYSE:ORCL), Silver Lake and Emirati investment firm MGX. This acquisition, set to be completed on Jan. 22, changes ownership to significantly reduce ByteDance’s control, potentially addressing concerns raised by the US about data security and foreign influence.
While TikTok itself remains private, the deal highlights the publicly listed companies that provide its technological backbone, most notably Oracle.
Oracle Takes A Step Back Into The Limelight
Under the new structure, Oracle will retain a 15% stake in the new TikTok U.S. entity, effectively establishing it as a dominant player in TikTok operations in the U.S. For investors, that matters less as a one-off headline and more as confirmation of Oracle’s growing role in data hosting, cloud infrastructure and compliance-driven tech solutions.
That narrative plays directly into several large and widely held technology ETFs, where Oracle is already a meaningful constituent. Funds such as the State Street Technology Select Sector SPDR Fund (NYSE:XLK) and the Vanguard Information Technology ETF (NYSE:VGT) offer exposure to Oracle alongside other U.S. tech heavyweights benefiting from enterprise software and cloud adoption trends.
The TikTok deal also highlights a broader shift that ETF investors have been leaning into: moving away from consumer-facing hype and toward “boring but essential” tech infrastructure. Data sovereignty, cloud security and regulatory alignment have become investable themes in their own right.
ETFs such as iShares Expanded Tech-Software Sector ETF (BATS:IGV) and First Trust Cloud Computing ETF (NASDAQ:SKYY) could also benefit, as there would be an increased demand for U.S.-based cloud services and software companies that users trust to store their data.
Policy risk is still a concern
Even with the restructuring, regulatory risks remain uncertain. TikTok parent ByteDance is set to hold an interest of 19.9%, with affiliates of current shareholders accounting for another 30.1%,meaning scrutiny from U.S. lawmakers is unlikely to disappear overnight. For those investing in ETFs, however, issues like these remain within the theme of ‘thematic tailwind’ rather than fundamentals.
The Bottom Line
TikTok’s U.S. deal isn’t a social media trade, it’s an infrastructure one. And for investors who want exposure without the geopolitical whiplash, enterprise-focused tech ETFs may be the closest thing to owning a slice of the action.
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Photo: Camilo Concha on Shutterstock.com
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