An update from the U.S. Department of Commerce says that it won’t move forward with a ban on TikTok. This comes after President Donald Trump’s administration pushed to have the app banned for security reasons.
The ban on TikTok was going to force it to sell off its U.S. assets or the app would face a ban in the country. However, some TikTok users came forward with lawsuits in an effort to stop the ban. Those efforts have paid off as the U.S. Department of Commerce update cites a court ruling as the reason for the ban not going into effect.
So what exactly does this have to do with Fastly and its soaring stock today. The company is a cloud computing service provider that TiKTok makes use of. With the news that the app won’t be banned, investors are likely hoping it will see additional business.
While that may be true, it’s worth noting that TikTok moved most of its business off of Fastly last month. The company has been working to beef up its own internal network for content delivery, reports TheStreet.com.
Another bit of news for Fastly investors to keep in mind is the ongoing U.S. elections. If presidential candidate Joe Biden wins it’s likely he would lift any kind of ban on TikTok. That could result in another boost for FSLYstock.
FSLY stock was up 1.5% as of Friday morning.
On the date of publication, William White did not have (either directly or indirectly) any positions in the securities mentioned in this article.