Meta (formerly called Facebook) pretty much ignored the social media elephant in the room today on a post-earnings conference call, with chief financial officer Susan Li saying it’s too early to discuss what just happened in Washington, D.C. President Biden has signed into law a bill that would force TikTok’s Chinese parent company to divest the hugely popular U.S. app within about nine months or risk it being banned.
TikTok said it will take the fight to the courts.
“We’ve obviously been following the events related to TikTok closely,” said Li (although the question had been directed to Meta CEO and founder Mark Zuckerberg). “But at this stage it is just too early, I think, to assess its impact or what it would mean to our business.”
Donald Trump’s White House also took a swing at TikTok through CFIUS (Committee on Foreign Investment in the United States) but ultimately backed off. Oracle has been acting as the data center for U.S. TikTok users.
In a competitive landscape, social media rivals weren’t above gloating a bit last time around although not thrilled with government intervention in their market. Meta is the first tech giant to report its numbers and chat with the Street since the law passed today, so it’s some others may weigh in more forcefully. Facebook rolled out Reels to compete with the TikTok juggernaut and some analysts are predicting a windfall in ad revenue for Meta if the Chinese-owned app is banned.
Facebook had a mixed first quarter report with beats on revenue and profit coming hand-in-hand with a forecast of softer sales and higher spending on AI that spooked the market. The shares, which have been flying high, are down more than 15% in late trading.
