Shares of Trump Media & Technology Group fell by more than 20% on Monday, less than a week after the company began trading publicly under the ticker DJT. The decline follows the revelation that the firm lost nearly $60m (£48m) last year while generating only around $4m in revenue.
The price plunge wiped $1bn from former President Donald Trump's net worth, according to Bloomberg. Shares had surged last week, giving the company an $11bn valuation, but experts warned the stock was bound to tumble as its main product, Truth Social, loses users and burns cash.
Trump Media makes money exclusively through advertising on Truth Social. On Monday, shares fell $13.30 to $48.66, though they remain up nearly 200% so far this year. The surge has been driven by small-time investors, some of whom appear to be showing support for the former president amid his legal troubles.
In a filing with the Securities and Exchange Commission, the company said it expects to continue incurring operating losses and negative cash flows for the foreseeable future. It paid about $40m in interest expenses and $16m in operating losses in 2023. Management expressed 'substantial doubt' about the company's ability to meet its liabilities as they fall due.
Truth Social launched in February 2022 after Trump was banned from Twitter and Facebook following the US Capitol riot. Despite his accounts being reinstated, he continues to use Truth Social as his main social media platform. However, the platform has struggled to gain a broad audience, with estimates showing roughly five million active monthly users, far fewer than rivals.
