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New York (CNN) – Shares of Trump Media & Technology Group, which owns Truth Social, fell on Monday after the company revealed it was projected to lose more than $58 million in 2023 and generate little revenue.
The figures underscore why some experts warn that the Trump media’s multibillion-dollar valuation defies logic and Memes remind of stock trend,
The numbers speak for themselves
In a regulatory filing on Monday, Trump Media said it would suffer a loss of $58.2 million in 2023, compared with a profit of $50.5 million in 2022.
The owner of Truth Social only made $4.1 million in revenue, although it was up from $1.5 million in 2022.
not only this, but Revenue fell 39% year-on-year In the fourth quarter, up to only US$751,500. This is not what investors want to see from any startup, especially one valued at these levels.
Shares of Trump Media fell 24% on Monday afternoon after the new data, although they are up nearly 200% so far this year.
The damage is so severe that Trump’s media accountants warn “Create substantial doubt about its ability to continue as a going concern”, which in the words of Wall Street means: “We may not be able to stay in business.” The warning echoes one he issued in November, when the accountant said Trump Media could not survive unless it completed its merger to go public soon.
The long-delayed deal closed last week, paving the way for Trump Media to receive nearly $300 million in cash. The company can now use those funds to pay off debt and, more importantly, build out its infrastructure.
“I think the $300 million in cash should eliminate this ‘going concern’ risk,” said Matthew Kennedy, senior IPO strategist at Renaissance Capital.
Even though Trump Media is losing money and generating very little revenue, Wall Street values the company at $11 billion Based on the stock’s closing price on Friday, according to Renaissance Capital.
While Trump Media earned only $4.1 million in 2023, its rival Twitter also generated more than $5 billion in revenue in the last year before privatization by Elon Musk.
The problem for Trump Media is that its core product, Truth Social, is shrinking.
According to SimilarWeb, monthly active users on iOS and Android in the US fell to 494,000 in February, down 51% year-over-year. By comparison, has 75 million monthly active users. According to SimilarWeb, Even Threads has more than 10 times the users of Truth Social.
“2024 is the defining year for this company,” Kennedy says. “For TMTG, the important thing now is to enter the money cannon in the 2024 presidential election. And the company has a notable advantage over Trump-backed independent campaign committees. have raised millions. Where do you think they’ll spend their budget? Digital advertising?”
You may also be interested. on video: Trump published a photo of Biden tied up in a truck and this is how their respective campaigns reacted
(TagstoTranslate)Donald Trump(T)Trump Media(T)Truth Social(T)Trump Media & Technology Group(T)Stocks(T)300 Million
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