The value of Truth Social, the parent business of Trump Media & Technology Group (TMTG), continues to collapse, which is a painful realization for Trump fans who participated in dumping money into the meme stock.
With the start of the trading day, the parent company of the social media network saw a 16% decline in its stock price. All of the advantages from the merger with a blank check acquisition firm have been wiped away as shares have been falling precipitously. The most recent decline follows TMTG’s announcement that the company will issue millions of new shares. As of this morning, the share price is far lower than $30, much lower than when TMTG was merged and much lower than half of what it was two weeks ago. The analysts’ insistence that Trump’s cash grab was a “scam” and that investors should avoid it at all costs has been heard from rooftops.
Investors are left high and dry as TMTG executives get bonuses worth millions of dollars. That some investors have accepted this shows how passionate and extreme Trump’s fans can be —gaining a bad Trump investment is more important to them than earning money.
After riding high on the success of the Trump Media and Digital World Acquisition Corp merger, Truth Social (NASDAQ: DJT) quickly fell, losing about a quarter of its market value in Monday afternoon trade. The report detailing net losses in 2023 and their extent is primarily responsible for this. Truth Social’s 2023 revenue was $4.1 million, which is neither excellent nor terrible. However, things took a turn for the worse when Truth Social disclosed a net loss of $58.2 million.
Interest payments are primarily responsible for that loss.
Truth Social’s market valuation is still estimated at several billions of dollars. So, even with the big loss, the overall picture is not utter disaster at the moment. There is still time for that.
