Trump Media erases all 2024 stock gains days

On Wednesday, Trump Media shares dropped $1.10, or 6%, to $16.98 — their lowest price since trading began in March. The stock saw little movement on Thursday.

Trump Media’s revenue has shrunk

Former President Donald Trump's stake in Trump Media & Technology Group was valued at over $6 billion in March when its shares soared following their public market debut. However, nearly six months later, that fortune has dwindled to less than $2 billion, as the company's stock has plunged and revenue has shrunk.

The stock has lost more than 70% of its value since its peak in late March, hitting a new low on Wednesday. As the largest shareholder, Trump has faced the biggest losses, although these are only on paper for now, as he has not yet sold any of his shares.

Trump holds about 60% of Trump Media & Technology Group, a social media company trading under the ticker DJT (his initials). The platform has attracted a loyal base of supporters, many of whom are retail investors concerned about the declining stock price. On Truth Social, some investors have blamed short sellers for the drop.

Truth Social users’ concerns

One Truth Social user suggested halting trading of the stock temporarily to address the alleged manipulation: "Just a thought, why doesn't [Trump Media & Technology Group] halt the stock while they check into all the manipulation?" the user wrote, suggesting this could unsettle short sellers.

Despite the concerns, short sellers are not responsible for the decline, according to Ihor Dusaniwsky, managing director at financial data firm S3 Partners. He explained that there’s very little stock available to short. "Even if every available share to borrow was shorted today, it would be less than 8% of today's trading volume," he said. "The stock price movement in recent weeks is mainly due to long selling, not short selling."

Meme-Stock performance

Analysts have pointed out that Trump Media shares often behave similarly to so-called meme stocks—stocks driven more by online buzz and social media than by traditional business metrics like revenue or profit growth.
For example, following an assassination attempt on Trump in July, Trump Media's stock price surged by over 30%. Around that time, polls also showed Trump leading in the race for the November presidential election.
However, about a week later, President Joe Biden withdrew as the Democratic nominee, and Vice President Kamala Harris, now the candidate, has been gaining in the polls. According to CBS News polling, she is now tied with Trump in key battleground states.
Since Biden's decision to step aside on July 21, Trump Media shares have dropped by 51%.

While Truth Social has a loyal base of Trump supporters, it has yet to turn a profit or grow its revenue significantly.

In its second-quarter earnings report last month, Trump Media announced that its revenue had dropped 30% to $836,900 compared to the same period the previous year. The company also posted a loss of $16.4 million for the quarter, an improvement from its $22.8 million loss the previous year, according to regulatory filings. The decline in revenue was attributed to changes in a revenue-sharing agreement with an advertising partner.

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