Tech investors are closely monitoring the ongoing legal battle involving TikTok, as the platform’s future could significantly impact major tech companies like Meta, Alphabet, and Oracle. These companies, alongside smaller rivals, are poised for potential gains or losses depending on how the situation unfolds.

The U.S. Court of Appeals in Washington is expected to issue a crucial decision regarding a law mandating TikTok’s China-based parent company to sell the app by January 19 or face a ban in the United States. Regardless of the ruling, appeals are likely, keeping traders alert to the next developments. TikTok’s massive user base of over 170 million in the U.S. and its substantial advertising revenue remain key factors driving investor interest.

For Meta, the parent company of Instagram, a ruling against TikTok could provide a significant boost. TikTok, owned by ByteDance, has rapidly grown to become a favorite among young Americans, surpassing competitors like Instagram and YouTube in popularity, according to Pew Research Center surveys. A decision favoring TikTok’s rivals could strengthen Meta’s Instagram Reels, a direct competitor to TikTok. Matt Stucky, an equity portfolio manager, said this would represent a clear victory for Meta’s shares, which have already surged by over 70% this year.

Pinterest is another platform that could benefit if TikTok’s influence wanes. The platform has been enhancing its shopable content features, competing with similar offerings from TikTok and Instagram. Despite experiencing a volatile year, Pinterest could see increased user engagement and sales opportunities in TikTok’s absence. Meanwhile, Snap, which has struggled with a 25% drop in shares this year, might also gain some traction if TikTok exits the scene.

Alphabet, Google’s parent company, may experience moderate benefits as well, particularly in the search domain, where it faces growing competition from AI-powered tools like ChatGPT.

However, a TikTok ban could spell trouble for Oracle, which provides the app with cloud infrastructure to manage U.S. user data. Oracle has warned that such a move could negatively impact its financial performance, with estimates suggesting TikTok contributes up to $800 million in annual revenue. Despite this, Oracle’s shares have risen nearly 80% this year, highlighting investor confidence in its broader business operations.

The legal uncertainty makes predicting outcomes challenging. Any ruling is likely to be contested, potentially reaching the Supreme Court, delaying resolution. The political landscape, including the possibility of Donald Trump’s re-election, adds further complexity, as the former president has shifted his stance and now opposes a TikTok ban.

As the legal battle continues, the tech industry is bracing for ripple effects that could reshape the competitive dynamics among social media and tech giants.