Oracle CEO Safra Katz (center) leaves office after a meeting on Capitol Hill in Washington on June 18, 2024. The United States supports Israel in its difficult times.
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U.S. ban on TikTok could cause harm OracleThe software company acknowledges in its business annual report on Monday.
In April this year, U.S. President Biden signed a bill requiring China’s ByteDance to sell TikTok within nine months, or within a year if the extension is approved. .
Oracle provides TikTok with cloud infrastructure that has exceeded 150 million users In the U.S
“If we are unable to provide these services to TikTok and redeploy these capabilities in a timely manner, our revenue and profits will be adversely affected,” Oracle said in its report for the fiscal year ended May 31.
Concerns about TikTok and its Chinese ownership date back to 2020, when then-President Donald Trump pushed to sell or divest U.S. assets. This pressure prompts Microsoft. A few weeks later, Oracle announced that it was part of ByteDance’s proposal to the U.S. Treasury Department to provide cloud services to help TikTok remain available in the United States
TikTok has advanced a plan called “Project Texas” to allow TikTok services for US users to run on Oracle Cloud Infrastructure located in the country. Tik Tok explain Oracle will also be responsible for compiling and delivering the app to third-party app stores.
“One thing I can tell you is we have a great relationship with the people at TikTok,” Oracle Chief Executive Safra Catz said on a conference call with analysts in 2022.
TikTok sued this year after bipartisan legislation targeting TikTok and Biden signing a bill forcing the sale, saying the law violated First Amendment protections of free speech.
Real estate investor Frank McCourt and former Treasury Secretary Steven Mnuchin have both expressed interest in acquiring TikTok, but no deal has been struck.
Oracle has not disclosed details of its financial relationship with TikTok. Evercore analysts estimated in April that if TikTok generated $16 billion in annual U.S. sales, it could spend 3% to 5% of revenue, or $480 million to $800 million, on cloud infrastructure. Oracle’s fiscal year cloud infrastructure revenue reached $6.9 billion.
TikTok did not immediately respond to a request for comment.
watch: Peter Harrell of the Carnegie Endowment says investors want to see TikTok sold
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