Oracle stock rose by up to 5% following the announcement that there was an initial deal on TikTok between the United States and China in trade negotiations in Madrid. Secretary of the US Treasury, Scott Bessent, said that the two countries were taking a structure on the agreement.
US President Donald Trump and Chinese President Xi Jinping are expected to finalize a deal later this week. While no official acquirer from the US has been announced, Oracle has positioned itself as a leading candidate to purchase TikTok. Additionally, the company may join a consortium that would help manage TikTok's operations in the United States, according to CBS News.
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According to CNBC, the deal would enable Oracle to maintain its current cloud relationship with TikTok. The tech company is already offering cloud storage of data from American TikTok users in Project Texas, a program introduced in 2022 to address national security issues.
Oracle share price also went up in premarket trade when Trump indicated that the talks about social media were making progress. He characterized the trade conference with China as fruitful and stated that he was negotiating a deal with a particular company that was popular among the United States' youth.
TikTok has a deadline of either selling its ownership to a US company or an allied company by September 17 or face a countrywide ban. Trump has said he might give it more time, although the pressure is on the parent company of TikTok, ByteDance, to cut its stake.
Previous reports implied that the White House was considering having Oracle as one of the possible operators. However, in such a scenario, there would still be room to give ByteDance a degree of influence.
In recent years, Oracle has also improved its relationship with the Trump administration. Its chair, Larry Ellison, joined Trump in January, along with OpenAI CEO Sam Altman and SoftBank CEO Masayoshi Son, to announce Stargate, a $500 billion project to create AI data centers in the United States.
Oracle has seen its stock grow despite competition from other interested parties, including Microsoft, billionaire Frank McCourt Jr., YouTuber Mr. Beast, and Perplexity AI.
This year, Oracle has seen its shares increase by 81%, fueled by robust cloud revenue, including a $300 billion deal with OpenAI that is expected to grow through 2030.