- Trump’s social media company released new financial results, which are not good.
- But those are just the numbers he’s willing to release.
- He won’t share how many users he has or how many subscribers he has. It’s a giant red flag.
The stock price of Trump Media & Technology Group Corp – Donald Trump’s social media company – fell nearly 25% on Monday.
That’s likely because investors have been looking at new financial data, which illustrates that Trump Media & Technology Group — the company that gave you Truth Social — is a bad deal.
It does not mean anything.
There is no person who cares about the business prospects of the Trump Media & Technology Group who is unaware that it is a bad deal. You saw this in the company’s past filings, which also illustrated that it was a bad deal.
If you want to squint, you could argue that the new filings are particularly bad because they illustrate that bad deals are becoming more and more problematic. worse.
For example: After generating $3.4 million in revenue in the first nine months of 2023, an average of $1.1 million per quarter, Trump Media only generated an additional $750,000 in revenue in the during the last quarter of the year. A tough growth story to sell, even for Donald Trump.
But no rational person has looked at Trump Media & Technology Group Corp.’s financial data. and only concluded that it was a $6 billion or $9 billion company, or something close to it. People bought the stock because they like Donald Trump, or because they like the idea of investing in a meme stock backed by people who like Donald Trump.
I hear your objection right now: How can you be sure that Trump Media & Technology Group is not a real company based solely on its miserable finances? Don’t fast-growing tech companies often work on growth, then turn around and focus on things like revenue and profits?
Of course! Sometimes.
Twitter, for example, was losing money when it went public, and investors thought it was worth tens of billions of dollars until Elon Musk bought it. (Since then, it’s a different story.)
But Twitter, and every other social media company that has gone public, has at least been able to tell investors that they are becoming more popular by providing numbers like average users and other statistics. increasing. See: Reddit’s IPO last month.
What about Trump Media & Technology Group? They don’t tell investors anything about how many people are signing up. Or how many of them stick around. Or how ad sales work.
Nothing. Nada.
According to Trump Media’s most recent filing, which echoes one filed earlier this year: “TMTG believes that meeting traditional key performance indicators, such as registrations, average revenue per user, ad impressions and rates, or active user accounts, including monthly and daily active user accounts, could potentially divert its attention from strategic evaluation with respect to the progress and growth of its business.
Translation: If we tell you how many people use Truth Social – or how many people signed up but no longer use Truth Social – even We you may find it difficult to invest in us. So we won’t do it!
Trump’s company doesn’t even promise to track this stuff himself: “TMTG may find it difficult or expensive to implement such effective controls and procedures and may never collect, monitor or report one or certain key operational parameters.” I have requested comment from the company.
So this is it. The numbers Trump’s social media company is willing to share with investors illustrate that this is bad business. And the numbers he won’t share with them? It must be something else.
So the next time Trump Media makes a reservation – a bet many people have already made – don’t hesitate to think of a good reason. Just don’t say they saw new data. We already know everything we need to know about this one.
businessinsider
