Trump Media & Technology Group (TMTG) faced another decline in its stock value early on Thursday, extending its recent downward trajectory. The company, which includes the Truth Social platform, saw its stock value slip, leading to a reduction in the stake held by former U.S. President Donald Trump.
During premarket trading, Trump Media shares experienced a marginal decrease of 0.1%, reaching $34.22. This decline followed a notable 8.6% drop in the previous trading session, with the stock closing at $34.26 on Wednesday.
At Wednesday’s closing price, Donald Trump’s ownership stake in the company, approximately 57%, was valued at around $2.69 billion. This marked a substantial decrease from the peak value of over $5 billion reached shortly after the stock’s debut on the Nasdaq exchange on March 26th.
The decline in Trump’s stake in Trump Media has resulted in his exclusion from the Bloomberg Billionaires Index, a prestigious ranking of the world’s wealthiest individuals. However, Trump’s ability to sell his shares is currently restricted by a six-month lockup period. Nevertheless, there is the possibility for him to pursue a waiver from the company’s board, which notably includes one of his sons and several former members of his administration.
Despite the challenges faced by Trump Media, Trump still stands to gain 36 million earnout shares in the company, contingent upon certain performance metrics. These incentives are tied to the volume-weighted average price of the stock remaining above specific levels over a three-year period following the company’s merger on March 25th.
Truth Social, the flagship platform of Trump Media, has positioned itself as a conservative alternative to mainstream social media platforms like Facebook and Reddit. However, its user base remains significantly smaller compared to its competitors. In terms of financial performance, Trump Media reported revenue of $4.1 million for 2023, accompanied by a net loss of $58.2 million. Despite these challenges, the company continues to navigate its path in the highly competitive social media landscape.