Shares of Donald Trump's social media company plunged 21% on Monday, wiping out the gains from its debut last week, after disclosing millions in losses and saying it would struggle to meet its financial liabilities going forward.
Trump Media & Technology Group (DJT.O), lost more than $58 million in 2023, it said in a filing, sending shares reeling less than a week after the Truth Social parent went public through a high-profile blank-check merger.
The stock surged in its March 26 debut to close at nearly $58 a share on retail buyer enthusiasm, including supporters of Trump, the likely Republican nominee in 2024's presidential election. But Monday's disclosure reversed that trend, sending shares down $13.30, or 21%, to $48.66.
Trump owns 78.75 million shares, which could result in a big windfall for the former president, depending on their value. At the stock's peak last week, his stake would have been more than $6 billion, but after the selloff it would be valued at about $3.8 billion. Trump is not allowed to sell or borrow against any of his shares for six months - and any move by him to try to alter that agreement would likely trigger more selling.
Even with the stock's decline, it still has a market value of more than $6 billion, compared with social media platform Reddit's market capitalization of $8 billion.
Truth Social's revenue was $4.13 million last year, up from $1.47 million in 2022, it said. By comparison, Reddit brought in revenue of $800 million in 2023.
The latter has 73 million active users, whereas Truth Social only discloses its total number of sign-ups, which come to 8.9 million. In its filing on Monday, TMTG said it has no plans to disclose key metrics generally used by similar companies.
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