TikTok parent ByteDance to keep 50% of profits after Trump-brokered sale

TikTok’s Chinese parent company is poised to keep roughly half the profits from the app’s US business — even after ceding majority ownership to US investors under a deal pushed by President Trump, according to a report.

People familiar with the talks told Bloomberg News that ByteDance would pocket both a licensing fee for TikTok’s prized algorithm and a profit share tied to its remaining equity stake in the US venture.

That would likely leave ByteDance with a total of 50% or more of TikTok US earnings once the sale is completed, according to Bloomberg News.

The arrangement may help explain the Trump team’s floated $14 billion valuation for the US unit — a number that fell sorely short of analyst estimates of $35 billion to $40 billion.

Ashwin Binwani, founder of Alpha Binwani Capital, told Bloomberg News that the proposal “could be the most undervalued tech acquisition of the decade,” arguing the figure reflects just a third of TikTok’s true worth.

Under the draft plan, TikTok US would pay ByteDance a fee equal to about 20% of revenue generated through its recommendation algorithm.

At $20 billion in sales, for example, that would amount to $4 billion for ByteDance, according to one source.

The Beijing-based company would also retain about 20% of profits on the remaining revenue through its ownership stake.

The US-backed buying group is expected to include Oracle Corp., Silver Lake Management and Abu Dhabi-based MGX, alongside existing investors.

Collectively, they would hold about 80% of TikTok US.

The deal remains unresolved despite Trump’s insistence that he struck an understanding with Chinese President Xi Jinping during a call last week.

Chinese officials have not publicly confirmed any agreement, and the exact terms are still being negotiated.

Vice President JD Vance, who revealed the $14 billion price tag on Thursday, conceded that the ultimate purchase price will be determined by the investors.

The Biden administration had previously signed legislation requiring ByteDance to divest TikTok US or face a nationwide ban. Trump has repeatedly extended the deadline while brokering talks with buyers, claiming support on the platform helped secure his 2024 election win.

The Post has sought comment from ByteDance, TikTok and the White House.

The Chinese embassy in Washington told Bloomberg News that the US “needs to provide an open, fair and non-discriminatory environment for Chinese investors.”

With the profit-sharing structure still in flux, analysts warn that US buyers could be paying bargain-basement prices for an app that dominates the short-video market and generates more than $10 billion a year in American revenue.