Trump Media Stock Nosedives After The Company Posts A Massive Loss
So when we last looked at the other train wreck next to the dumpster fire in social media that is known as Truth Social, the company merged with Digital World Acquisition Company which as part of the deal took Truth Social public. That looked good at the start, but now this is what their stock looks like:
So as you can see, there was a spike when the merger happened. But it’s fallen off a cliff since. Why you ask? Yahoo has the answer:
The stock drop comes on the heels of an updated regulatory filing early Monday that showed the company taking on heavy losses and facing “greater risks” associated with the former president’s ties to the platform.
According to the filing, Trump Media reported sales of just over $4 million as net losses reached nearly $60 million for the full-year ending Dec. 31. The company warned it expects losses to continue amid greater profitability challenges.
“TMTG has historically incurred operating losses and negative cash flows from operating activities,” the filing read.
“TMTG expects to continue to incur operating losses and negative cash flows from operating activities for the foreseeable future, as it works to expand its user base, attracting more platform partners and advertisers.”
Truth Social has lured about 9 million users since its inception. But its success largely depends on the “reputation and popularity” of former President Donald Trump.
“TMTG may be subject to greater risks than typical social media platforms because of the focus of its offerings and the involvement of President Trump,” the company said, citing risks that include the harassment of advertisers and criticism of Truth Social’s moderation practices.
“The value of TMTG’s brand may diminish if the popularity of President Trump were to suffer.”
Notably, Trump Media revealed it heavily relies on advertising with ad sales contributing to a “substantial majority of our revenue.”
“If we experience a decline in the number of users or a decline in user engagement, including as a result of the loss of high-profile individuals and entities who generate content on Truth Social, advertisers may not view Truth Social as attractive for their marketing expenditures, and may reduce their spending with us, which would harm our business and operating results,” the company warned.
Investors in this company have been introduced to reality. Which is business fundamentals trumps blind and illogical devotion to an individual. My question is how long will the investors in this stock wait until they pull the plug and sell which will make life very different for a certain Donald J. Trump who I am sure was hoping to seriously cash in on this.
This entry was posted on April 1, 2024 at 1:47 pm and is filed under Commentary with tags Truth Social. You can follow any responses to this entry through the RSS 2.0 feed.
You can leave a response, or trackback from your own site.
Trump Media Stock Nosedives After The Company Posts A Massive Loss
So when we last looked at the other train wreck next to the dumpster fire in social media that is known as Truth Social, the company merged with Digital World Acquisition Company which as part of the deal took Truth Social public. That looked good at the start, but now this is what their stock looks like:
So as you can see, there was a spike when the merger happened. But it’s fallen off a cliff since. Why you ask? Yahoo has the answer:
The stock drop comes on the heels of an updated regulatory filing early Monday that showed the company taking on heavy losses and facing “greater risks” associated with the former president’s ties to the platform.
According to the filing, Trump Media reported sales of just over $4 million as net losses reached nearly $60 million for the full-year ending Dec. 31. The company warned it expects losses to continue amid greater profitability challenges.
“TMTG has historically incurred operating losses and negative cash flows from operating activities,” the filing read.
“TMTG expects to continue to incur operating losses and negative cash flows from operating activities for the foreseeable future, as it works to expand its user base, attracting more platform partners and advertisers.”
Truth Social has lured about 9 million users since its inception. But its success largely depends on the “reputation and popularity” of former President Donald Trump.
“TMTG may be subject to greater risks than typical social media platforms because of the focus of its offerings and the involvement of President Trump,” the company said, citing risks that include the harassment of advertisers and criticism of Truth Social’s moderation practices.
“The value of TMTG’s brand may diminish if the popularity of President Trump were to suffer.”
Notably, Trump Media revealed it heavily relies on advertising with ad sales contributing to a “substantial majority of our revenue.”
“If we experience a decline in the number of users or a decline in user engagement, including as a result of the loss of high-profile individuals and entities who generate content on Truth Social, advertisers may not view Truth Social as attractive for their marketing expenditures, and may reduce their spending with us, which would harm our business and operating results,” the company warned.
Investors in this company have been introduced to reality. Which is business fundamentals trumps blind and illogical devotion to an individual. My question is how long will the investors in this stock wait until they pull the plug and sell which will make life very different for a certain Donald J. Trump who I am sure was hoping to seriously cash in on this.
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This entry was posted on April 1, 2024 at 1:47 pm and is filed under Commentary with tags Truth Social. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.