Shares of Trump Media & Technology Group’s stock TMTG (DJT) tumbled 14% on Tuesday after closing 18% lower Monday after the company’s premier product, Truth Social, announced a major expansion into streaming, a cost-intensive business tha has seen the likes of Disney and HBO struggle to make profit from.
TMTG’s stock, majority-owned by former President Donald Trump, is down more than 70% from the all-time high it set on March 26, the day after it merged with a blank-check acquisition company to go public.
Although the company is still worth billions of dollars, it is struggling to make money according to Wall street experts.
Wall Street Experts have warned investors to be careful if they choose to trade the stock, because the company doesn’t have the fundamentals to back up its sky-high valuation.
Trump Media lost $58 million in 2023 and made just $4.1 million in revenue. So, it announced Monday it would sell 21.5 million more shares to the public to raise cash even though that would dilute the value for existing shareholders.
The streaming initiative didn’t give investors any reason to get expectant about the company. Truth Social said it spent the past six months testing its web, iPhone and iPad apps for live TV streaming, and it hopes to launch a content delivery network to stand up streaming apps for phones and tablets and eventually smart TVs.
Truth Social said its streaming network could host live news, religious programing and family-friendly shows, movies and documentaries that “has been cancelled, is at risk of cancellation, or is being suppressed on other platforms and services.”
“With our streaming content, we aim to provide a permanent home for high-quality news and entertainment that face discrimination by other channels and content delivery services,” said TMTG CEO Devin Nunes, a former Republican congressman for California in a statement.
“There is a lot of great content that simply can’t find an audience for unjust reasons, and we want to let these creators know they’ll soon have a guaranteed platform where they won’t be cancelled.”
Trump added billions of dollars to his net worth after TMTG’s merger with the blank check company in late March. But his shares’ value has plunged from a peak of $5.2 billion to about $1.8 billion. Trump’s net worth fell roughly $300 million Tuesday from the stock’s plunge.
