TikTok's transformation into a US-owned entity has sparked fundamental questions about its future, from user trust to algorithm performance to ecommerce ambitions.

"If a critical mass of American users start to develop the idea that TikTok has turned into some kind of mouthpiece or organ of the United States government, that's a potentially huge problem for its cultural standing," said our analyst Max Willens on a recent episode of "Behind the Numbers.”

After TikTok became a majority American entity through TikTok USDS Joint Venture LLC in the end of January, the platform was grappling with technical glitches, user concerns, and advertiser hesitation. Daily active TikTok users in the US temporarily dropped from 92 million to around 86 million to 88 million following the transition, according to SimilarWeb data, before recovering slightly to 90 million.

TikTok faces a perception problem

Questions about bias have become TikTok’s most pressing challenge.

"The issue of perception is probably more important than reality when it comes to the minds of advertisers," Willens said.

Accusations surfaced that the platform was artificially suppressing posts critical of President Trump and content related to specific news events, with complaints coming from high-profile figures including singer Billie Eilish and California Governor Gavin Newsom, who announced a formal inquiry into alleged content suppression.

The fallout could accelerate advertiser pullback from the platform: TikTok-heavy campaigns fell 48% YoY, while platform-agnostic content campaigns surged 133% on Collabstr, found Collabstr’s 2026 annual influencer marketing report.

Among users, concerns are mounting over whether TikTok can sustain the addictive appeal of its “For You” feed.

• TikTok's content recommendation algorithm will be licensed from ByteDance and retrained on American user data, but it’s uncertain if the new version can match the original's performance.
• "People really romanticize this algorithm that they perceive that they've had since peak 2020 TikTok," said our analyst Emmy Liederman. "Even the perception that they're starting over is notable considering how connected people feel to their TikTok algorithm."

Users reported widespread issues immediately following the ownership change, including upload errors and completely reset For You algorithms. Oracle attributed some problems to a "temporary weather-related power outage," though such physical events rarely affect major apps that typically maintain multiple backup systems.

The algorithm's performance directly impacts both user retention and advertiser effectiveness.

• US TikTok user growth was already slowing before the transition: The share of internet users on TikTok will only increase from about 39% to more than 42% over the next three years, per a May 2025 EMARKETER forecast.
• Any perceived decline in content quality or relevance could slow user growth even further.

TikTok Shop has room to grow

Despite the turbulence, TikTok Shop represents a significant growth opportunity. The platform has successfully established itself as a destination for product discovery and purchase, with an expanding roster of major brands opening storefronts.

• TikTok Shop’s US ecommerce sales will surpass those of Target, Costco, Best Buy, and The Kroger Co. this year, according to EMARKETER’s February 2026 forecast.
• "That to me is a testament to how well they've grown that service," Willens said.

However, TikTok still has work to do to build consumer confidence.

“The big difference between TikTok and Amazon is that trust element and also the efficiency, and just feeling confident that you're actually going to get the thing that you ordered,” Liederman said, noting that TikTok is following Amazon's trajectory but has yet to fully earn that trust.

If concerns about bias or content moderation intensify, brands may reduce their TikTok Shop presence.

• The platform has attempted to address concerns through new features like a local feed that shows content from users' neighborhoods, though this requires sharing precise location data.
• Willens suggested this move aims to strengthen TikTok's position as a search destination and boost its small business advertising base by creating more contextually relevant ad placements.

Listen to the full episode

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