Trump Media reported a net loss of $327.6 million in the first quarter of 2024 and brought in $770,500 in revenue, according to a Monday SEC filing. Stock prices tumbled in the days that followed.
Trump Media & Technology Group, the parent company of Donald Trump's social media platform Truth Social, credited the loss in part to the costs of merging with Digital World Acquisition Corp. to go public at the end of March.
Experts have likened the stock to a meme stock, given its volatility and potential for overvaluation, noting that Trump Media investors may be more ideologically driven than your average anti-short seller. The company's CEO lauded its 'legion of retail shareholders' in a release this week.
“After an unprecedented, years-long process, we have consummated our merger and dispensed with the vast bulk of merger-related expenses, leaving the Company well-capitalized and supported by a legion of retail shareholders who believe in our mission to provide a free-speech beachhead against Big Tech censorship," Trump Media CEO Devin Nunes said in a press release.
Share prices nosedived this week, dropping to $44.19 at close Tuesday, down 13.2% from Friday's close.
Meme stock news:GameStop, AMC stock booming after Roaring Kitty's return. Will Trump Media stock follow?
Trump founded his social media company in 2021 after being booted from other major platforms following the Jan. 6 riot at the U.S. Capitol.
Trump Media went public on the Nasdaq on March 26 through a merger with shell company Digital World Acquisition Corp., a special purpose acquisition company, or SPAC. The merger was announced in 2021.
Trump's debut on the stock market was splashy, with Trump Media shares soaring, helped partly by – and to the delight of – his supporters.
But regulatory filings show the company was operating at a loss in 2023, making about $4 million in revenue while losing more than $58 million.
Accounting firm BF Borgers CPA PC said in a letter to Trump Media shareholders that the operating losses “raise substantial doubt about its ability to continue as a going concern.”
BF Borgers CPA PC was shut down by the SEC recently after being accused of "massive fraud." This made the Trump Media's filing a bit of surprise, according to Axios, and the numbers here have not been audited.
Monday's filing shows side-by-side comparisons of the Q1 in 2023 versus 2024.
In the news release, the company said it is working on adding live TV streaming to its platform.
Trump himself owns more than 114 million shares of Trump Media, though he cannot cash in on them until the end of September, six months after going public.
At one point, the Trump Media shares were a potential source of funding to put toward hefty legal fees in several cases he faces as a defendant. Trump was ordered to pay a combined $537 million across two civil cases earlier this year, both of which he is appealing.
But in April, Trump posted a reduced bond of $175 million fronted by California billionaire Don Hankey to prevent his assets from being seized in the New York fraud case.
Trump has also been ordered to pay $10,000 in fines for gag order violations in his hush money criminal trial so far. That case has been ongoing for more than five weeks now, but the prosecution and defense teams have rested their cases and closing arguments are scheduled to start Tuesday, May 28.
Contributing: Bailey Schulz, Jessica Guynn and Jeanine Santucci
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