Oracle Corporation (ORCL) shares surged nearly 5% on Monday after a double dose of headline-making news: the White House formally named the software giant as a leading investor in a new venture that will control TikTok’s U.S. operations, and Oracle itself announced a sweeping change to its top leadership team.
A senior White House official confirmed Monday morning that Oracle is part of a consortium of American investors taking control of the popular short-form video platform’s U.S. business. Under the agreement, TikTok’s American operations will be spun off into a newly created, U.S.-based joint venture that will be majority-owned and majority-governed by U.S. investors. Oracle shares traded at $323.78, up $15.12, or 4.9%, as of 2:23 PM EDT.
According to the official, Oracle and private equity powerhouse Silver Lake will spearhead the new entity, while TikTok’s Beijing-based parent ByteDance will retain a minority equity stake of less than 20%. The joint venture will receive a copy of TikTok’s prized content-recommendation algorithm — a critical piece of intellectual property that powers the app’s viral appeal — which will be “fully inspected” and “retrained” by Oracle as the group’s designated security provider for U.S. user data. U.S. government officials will also have authority to conduct ongoing inspections of the algorithm.
“We feel [this deal] meets every security requirement that we need for the algorithm to make sure it’s behaving appropriately,” the senior White House official said. President Donald Trump is expected to sign an executive order later this week declaring that the new arrangement satisfies U.S. national security needs. Trump has repeatedly touted the agreement and said Sunday that the final investor list would include “really great people, very prominent people.”
TikTok has been under intense pressure from Washington for more than two years. The app faced an effective U.S. ban unless ByteDance sold a controlling interest to U.S. or allied investors by December 16. Congress passed a law banning TikTok under former President Joe Biden in 2024, and Trump — who had previously sought to ban the app during his first term — campaigned on a promise to “save” it instead. He extended the divestment deadline several times as TikTok became a flashpoint in broader U.S.–China trade negotiations.
The White House official emphasized Monday that the federal government will not take an equity stake, a “golden share,” or a board seat in the new company — unlike its arrangements with U.S. Steel and Intel — although it may levy a facilitation fee for brokering the transaction.
Multiple outlets had reported that Oracle was likely to be included in the investor group. Analysts told Yahoo Finance that Oracle’s expanded role in TikTok’s U.S. operations is a clear positive for the company, as it deepens a business relationship that already makes TikTok one of Oracle Cloud Infrastructure’s most significant customers. Oracle has been housing TikTok’s American user data since 2022, and Morningstar analyst Luke Yang estimated that this work represented roughly 5% of OCI’s revenue in Oracle’s fiscal 2025. “TikTok has always been a major customer of OCI,” Yang said. “We believe the biggest value for Oracle is to keep TikTok as a customer.”
In a separate announcement on Monday, Oracle revealed a major change at the top of its corporate leadership. The company said it will replace longtime CEO Safra Catz, who has led Oracle since 2014. In her place, Oracle named two co-chief executives: Clay Magouyrk, formerly president of Oracle Cloud Infrastructure, and Mike Sicilia, previously president of Oracle Industries. Both were elevated to their prior roles in June and will now run the entire company jointly.
Catz, an Israeli-American billionaire and former investment banker, has been appointed executive vice chair of Oracle’s board of directors. Oracle founder and chair Larry Ellison said in a statement that Catz will continue to “guide Oracle’s direction, growth and success.” Catz herself told analysts on a Monday morning call that the timing of the transition was deliberate. “It is absolutely time,” she said. “You want to make a transition like this when things are great.” She added that she will remain actively involved in Oracle’s operations.
Argus Research analyst Joe Bonner told Yahoo Finance that while the leadership news may have surprised some investors, “I wouldn’t say it’s totally unexpected,” noting that Oracle is performing “really well” and projecting robust growth.
Oracle shares have been on an impressive run since the company forecast its cloud revenue would reach $144 billion by its 2030 fiscal year — a projection bolstered by a $300 billion deal with OpenAI (OPAI.PVT). Bonner pointed out that Oracle Cloud Infrastructure and Oracle Industries — the divisions previously led by Magouyrk and Sicilia — are now “the biggest drivers of the company” and are central to its future strategy.
Pump Radar
Stock Alerts