Microsoft Pursues TikTok, Apple Hits New Record

Big Tech can’t seem to get out of the spotlight. The focus of Wall Street, Main Street and Capitol Hill centered largely on four of the largest U.S. tech giants on Wednesday as top Silicon Valley CEOs faced a public grilling from lawmakers over antitrust concerns.

Then, those same companies each impressed shareholders with shining quarterly reports. Now, a trillion-dollar tech giant is reportedly seeking to buy the new social media sensation out of China, TikTok.

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The Dow Jones Industrial Average added 114 points, or 0.4%, to finish at 26,428. The Nasdaq, driven by a huge day for its most heavily weighted component, continued its 2020 trend of outperforming the broader market, adding 1.5% on the day.

Apple jumps 10% following split announcement. Not only did Apple (ticker: AAPL) impress with Thursday’s earnings report — it beat both revenue and earnings per share expectations — the iPhone maker announced a 4-for-1 stock split that will take effect in late August.

The move is largely cosmetic, but the company cited its desire to keep shares affordable for the widest number of people as a reason for the split. While nominally affordable, the $1.8 trillion company is trading for about 30 times trading earnings and is up about 80% in the last year, making its current value proposition debatable.

Microsoft picks TikTok? Mere days after Congress grilled Big Tech on its anti-competitive practices, including the swift acquisition of upstart rivals, Microsoft ( MSFT), which is worth over $1.5 trillion, is reportedly seeking to acquire the U.S. operations of the popular video app TikTok.

It’s likely a Microsoft acquisition is actually a more preferable outcome for the U.S. government, which is now publicly pressuring the China-owned parent of TikTok, ByteDance, to divest its interest. The concern is that TikTok could be used to spy on Americans.

This could give Microsoft some leverage if divestiture is essentially forced by regulators. Microsoft tried unsuccessfully to acquire Facebook ( FB) before it was a public company; Facebook wisely declined the offer and is worth more than $700 billion today.

Any TikTok acquisition would almost certainly run the buyer tens of billions of dollars.

Under Armour lacking direction. With the dramatic shutdown of major sports in the second quarter, athletic apparel companies were expected to struggle a bit. Under Armour ( UA, UAA) shares initially popped in early Friday trading, however, as the company easily surpassed revenue expectations.

Up as much as 12% in premarket trading on Friday, investors quickly decided to take gains — it turns out projections for revenue to fall between 20% and 25% in the second half of the year weren’t that inspiring. Under Armour also expects the all-important metric of gross margin to face pressure, and the company is also under scrutiny from regulators in regards to accounting practices.

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Microsoft Pursues TikTok, Apple Hits New Record originally appeared on usnews.com

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