Meta shares hit record high after TikTok divestment ruling

Meta Platforms (NASDAQ:META ), the parent company of Facebook, saw its shares reach an unprecedented peak on Friday, following a decisive legal victory that may impact one of its main competitors. Snap shares also surged on the news.

The U.S. appeals court upheld legislation mandating China-based ByteDance to sell its widely popular short video app TikTok by early next year or face prohibition in the United States.

The court's decision supports the bipartisan law signed by President Joe Biden, which empowers the U.S. government to also potentially ban other foreign-owned applications that pose data collection risks concerning American citizens.

TikTok, which boasts a user base of 170 million in America, and its parent company ByteDance have previously contested the law, claiming it infringes on constitutional rights and restricts free speech.

Following the ruling, Meta's stock value surged, with shares hitting a record of $629.78. The company's shares later settled slightly lower at $625.37, marking a 2.7% increase.

This financial boost underscores Meta's competitive stance in the social media landscape, where it vies with TikTok through its platforms, including Facebook and Instagram, particularly in the realms of user engagement and advertising revenue.

In the broader market, Alphabet (NASDAQ:GOOGL ), the holding company for YouTube and Google, also experienced a positive uptick. Their shares rose by 1.1%, reaching $174.68. Trump Media & Technology Group, which is majority-owned by President-elect Donald Trump and operates the Truth Social platform, similarly saw shares increase by 3.4%, closing at $34.89.

The appeals court's ruling, while currently favoring Meta, may not be the final chapter in this legal saga. ByteDance and TikTok are expected to challenge the decision, potentially taking their appeal to the full appeals court panel or the U.S. Supreme Court.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.

Source: Investing.com