Facebook and Instagram, the social media companies owned by Meta, and Alphabet – which owns Google and YouTube – benefitted after a U.S. appeals court upheld a law requiring China-based ByteDance to sell its popular short video app, TikTok, by early next year or face a nationwide ban.
Shares of Meta soared to a record high last week even as the ruling dealt a significant blow to ByteDance, whose app is used by 170 million Americans. It upheld legislation passed with bipartisan support in Congress and signed by President Joe Biden, granting the US government broad authority to ban foreign-owned apps deemed a risk to Americans’ data privacy.
ByteDance and TikTok had challenged the law, arguing it violates constitutional protections and infringes on Americans’ free speech rights.

How Meta and Google benefitted from the ruling

Meta’s shares climbed to a record high of $629.78 before settling at $625.37 – up 2.7%. The company’s platforms, including Facebook and Instagram, are key competitors to TikTok for both user engagement and advertising revenue.
Not only Meta but shares of Alphabet, the parent company of YouTube and Google, also rose 1.1% to $174.68. YouTube also offers Shorts platform for content creators to share short-length clips.
Thirdly, Trump Media & Technology Group, which owns the Truth Social platform, saw its stock increase by 3.4% to $34.89.
ByteDance and TikTok are expected to appeal the ruling to the full appeals court or the US Supreme Court.

What TikTok has to say

The company argued that the divestment law infringes on First Amendment rights and constitutes censorship.
“The Supreme Court has a strong track record of defending Americans’ free speech, and we are confident they will uphold this principle in our case,” TikTok said in a statement.
The law prohibits app stores and internet hosting services from offering TikTok after the deadline unless ByteDance sells its US operations.