Oracle's lucky break

Oracle has been all over the news lately, but nobody could have predicted this latest plot twist.

The company has become the poster child for AI trade woes: Investors are worried that Oracle is taking on too many liabilities at once in order to meet its commitments to building out data centers en masse, and have punished the stock accordingly. While shares were up 68% in 2025 through the end of September, the stock has tumbled 31% since then.

But TikTok just threw the struggling software giant a life line: The Chinese social media platform has agreed to sell its US operations to a joint venture that includes private equity investor Silver Lake, Abu Dhabi-based investment firm MGX, and Oracle, with each company getting a 15% piece of the pie.

That was enough to give Oracle shares a 6.87% boost today.

Will TikTok bring in the big bucks?

Oracle’s role is to be the “trusted security partner” in charge of auditing US user data and making sure that the new entity, TikTok USDS Joint Venture LLC, complies with “agreed upon National Security Terms,” according to a memo from TikTok CEO Shou Zi Chew. US data will be stored in Oracle’s data centers, and Oracle will also play a key role in retraining the TikTok app’s recommendation algorithm on US data “to ensure the content feed is free from outside manipulation.”

On paper, this is a much-needed win for Oracle: Good press, stronger ties to a household name, and most importantly, a use for those expensive data centers it can’t stop building. TikTok is already one of its biggest customers, but now that operations are heading stateside, it will rely on Oracle’s cloud business even more heavily, driving more revenue to the non-AI side of the company.

The deal also values TikTok at about $14 billion, and Bloomberg reports that parent company ByteDance is poised to rake in a record $50 billion in profits this year. But it remains to be seen how much of that actually trickles down to Oracle. William Blair analysts forecast an additional $1 billion to $2 billion in annual revenue for Oracle, though that number is a rough estimate.

Still, this is a big break for a company in desperate need of good news.—MR