The former President’s Trump Media & Technology Group which refers to itself as TMTG, has seen stock plummet after just one week.
Digital World Acquisition Corp merged with Trump Media in late February to a large fanfare. However, the media company’s share price has dropped a massive 20%+ in seven days of trading on the stock market.
Truth Social
The social media company tied to TMTG, Truth Social, relies on the supporters loyal to the former President, but this is a double-edged sword concerning growth.
According to a filing with the Securities and Exchange Commission (SEC), the company has stated in an overview that:
“TMTG aspires to build a media and technology powerhouse to rival the liberal media consortium and promote free expression. TMTG was founded to fight back against the big tech companies—Meta (Facebook, Instagram, and Threads), X (formerly Twitter), Netflix, Alphabet (Google), Amazon and others—that it believes collude to curtail debate in America and censor voices that contradict their woke ideology. TMTG aims to safeguard public debate and open dialogue, and to provide a platform for all users to freely express themselves.”
With this in mind, the company has set out a strong-minded mission statement, but this did little to stem the plunge in stock price as the statement laid bare the fact that “TMTG has historically incurred operating losses and negative cash flows from operating activities.”
Investors were keen to move away after the April 1 filing that the TMGT would have wished was an early April Fools.
The statement goes on that “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. TMTG’s ability to become profitable and generate positive cash flow depends on TMTG’s success in growing its user base, platform partners, and advertisers after the consummation of the Business Combination.”
The TMTG is piling its chips on growth that is “expected to come from the overall appeal of the Truth Social Platform. TMTG may enhance this appeal through new initiatives or by acquiring new technologies. TMTG has conducted extensive technological due diligence regarding, and has begun testing, a particular, state-of-the-art technology that supports video streaming and provides a “home” for cancelled content creators, and which TMTG aims to acquire and incorporate into its product offerings and/or services as soon as practicable.”
The company released a statement on TMTG website about the 10-K Report, with CEO Devin Nunes putting a brave face on the difficult SEC filing, saying “We are excited to be operating as a public company.”
If stock continues to fall the chance of TMTG operating publicly may be cut short, but the former President will be hoping that the surge in support for his 2024 election campaign can kick-start the dying interest and value in the company.
The post Stock sharply falls for Trump Media Group in just a week appeared first on Due.
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