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As a subscriber you can listen to articles at work, in the car, or while you work out. Subscribe NowShares of Donald Trump’s social media company jumped nearly 50% in the first day of trading on the Nasdaq, boosting the value of Trump’s large holdings in the company as well as the smaller stakes of fans who purchased shares as a show of support for the former president.
Trump Media & Technology Group Corp. was acquired Monday by a blank-check company called Digital World Acquisition Corp. Trump Media, which runs the social media platform Truth Social, has now taken Digital World’s place on the Nasdaq stock exchange.
Before trading began, Trump Media had a market value of about $6.8 billion, a figure that will rise significantly if the early gains in the shares hold. The shares are trading under the ticker symbol “DJT.” Trump holds a nearly 60% ownership stake in the company. As of 9:55 a.m., the shares were up 47%, to $73.50.
Many of Trump Media’s investors are small-timers either trying to support Trump or aiming to cash in on the mania, instead of big institutional and professional investors. Those shareholders helped the stock of Digital World more than double this year in anticipation of the merger going through.
These investors could experience a bumpy ride. For one, they’re betting on a company with vague prospects of turning a profit. Trump Media lost $49 million in the first nine months of last year, when it brought in just $3.4 million in revenue and had to pay $37.7 million in interest expenses. In a recent regulatory filing, the company cited the high rate of failure for new social media platforms, as well as the company’s expectation that it will lose money on its operations “for the foreseeable future” as risks for investors.
Truth Social launched in February 2022, one year after Trump was banned from major social platforms including Facebook and X, formerly Twitter, following the Jan. 6 insurrection at the U.S. Capitol. He’s since been reinstated to both but has stuck with Truth Social.
On Monday, Trump appeared in court in New York at hearing for a criminal case involving hush money payments made to cover up claims of marital infidelity. Afterwards, Trump told reporters that “Truth Social is doing very well. It’s hot as a pistol and doing great.”
However, Trump Media has yet to disclose Truth Social’s user numbers—although that should change now that the company is public. Research firm Similarweb estimates that Truth Social had roughly 5 million active mobile and web users in February. That’s far below TikTok’s more than 2 billion and Facebook’s 3 billion—but still higher than other “alt-tech” rivals like Parler, which has been offline for nearly a year but is planning a comeback, or Gettr, which had less than 2 million visitors in February.
Besides competition in the social media field, Trump Media faces other risks—including to some degree Trump.
Trump Media, which is based in Palm Beach, Florida, said in a regulatory filing that it “is highly dependent on the popularity and presence of President Trump.” If the former president were to limit or discontinue his relationship with the company for any reason, including due to his campaign to regain the presidency, the company “would be significantly disadvantaged.”
Acknowledging Trump’s involvement in numerous legal proceedings, the company noted that “an adverse outcome in one or more” of the cases could negatively affect Trump Media and Truth Social.
Another risk, the company said, was that as a controlling stockholder, Trump would be entitled to vote his shares in his own interest, which may not always be in the interests of all the shareholders generally.
If recent trading activity is any indication, investors should expect the shares to be volatile. Digital World shares more than doubled this year ahead of a shareholder vote on the merger with Trump Media. After the vote Friday, shares dropped almost 14%, but Monday they rebounded strongly with a gain of 35%.
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He should sell some shares to pay bond!
He’s restricted doing that for 6 months and apparently even restricted in using the shares as collateral though he could possibly get around that.
Are these the same idiots who enrolled in Trump University?
Yes , but Biden will forgive their student debt if they vote Biden this fall
I suspect once the “bandwagon” effect subsides, this will go the way of most Trump businesses, with the little guy getting screwed. Most of the investors are probably those same people who believe Trump contributes to his own campaign (he hasn’t since 2016), think the election was stolen, and give more than they can afford to help support this fraudulent billionaire.
Suckers. Trump is the only attraction to TS and once he goes to jail (can you post from prison) or dies, TS value will plummet (just like his sneakers). There’s a million better places to put your money..
Lol the funniest comment ive read on the subject. Look, I hate to spoil your parade and tantrum but Trump will get reelected and never do jail time. The Supreme Court already ruled that states can’t take him off the ballots in the primary and Trump won his appeal to get the bond drastically reduced. Some experts are predicting it’s a good chance it will be dismissed completly. Fani May in Georgia is a joke and he’ll eventually have that dismissed as well. Once he’s back in office, there’s going to be a lot of people keeping a low profile. Trump will also get reelected in 2028 as well. Mark my word…..
Kevin P. states “Trump will also get reelected in 2028 as well. Mark my word…..” This is exactly why Trump should never be president again. Either the people voting for him are too stupid to realize if he wins in 2024, this will be his last term, or the people voting for him will continue to support his ascension to a role like Trump’s idol, Putin, thus effectively bringing an end to our Democratic Republic.