Trump Media shares were sold off, causing former US President Donald Trump's assets to drop sharply compared to last week.
Trump Media & Technology Group shares closed down 8% on April 8. In total, the stock lost 30% of its market value over the past week.
The stock has been down for the past few sessions, after Trump Media reported a loss of $58 million on revenue of $4.1 million last year.
The sell-off in Trump Media has reduced former US President Donald Trump’s stake in the company to $2.9 billion, down sharply from a peak of $5.2 billion on March 27, the day after the company went public.
Trump currently owns 78.8 million shares of Trump Media, which was founded in 2021 and operates Trump's social media network Truth Social. Trump Media's plans to go public through a merger with a SPAC have been delayed for several years due to regulatory hurdles.
Mr. Donald Trump in West Palm Beach, Florida on March 24. Photo: Reuters
When Trump Media went public late last month, experts immediately warned that Wall Street was overvaluing the company. Truth Social’s fundamentals, including revenue, profits, and users, are all poor. Monthly active users in the U.S. fell 51% in February from a year earlier, to about 494,000, according to data firm Similarweb.
Meanwhile, X has 75 million monthly users in the US. Threads, a social network launched last year by Meta Platforms, also has 10 times the number of users as Truth Social.
After its first day of trading, Trump Media was valued at $11 billion. That's nearly double the valuation of social network Reddit when it went public in March, even though the platform had nearly 200 times more revenue.
Trump Media’s decline could affect the amount of money he could make from selling shares, though under the terms of the pre-listing merger, Trump would have to wait another six months to sell.
Meanwhile, short sellers are reaping the benefits of the move. According to data firm S3 Partners, about 4.75 million shares of Trump Media are being shorted. Yesterday’s drop alone netted the group $16 million.
Ha Thu (according to Reuters, CNN)
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