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Trump Media Stock Hits New Low
On Friday, the Trump Media & Technology Group stock experienced a significant drop, falling below $30 per share on the Nasdaq. This decline marked a new low for the company since its initial listing last month.
Market Performance
Midway through the trading day on Friday, the stock was down more than 5%, hovering around $30.88 per share. This slight uptick followed an earlier dip to $29.57, representing a post-merger low for Trump Media. Consequently, the company’s market capitalization diminished to approximately $4.2 billion, a stark decrease from its $8 billion valuation during the initial trading week.
Trump Media, the entity behind the creation of former President Donald Trump’s Truth Social platform, went public on the Nasdaq under the symbol DJT after finalizing a merger with Digital World Acquisition Corp., a special purpose acquisition company (SPAC). In its peak trading week, shares of Trump Media reached nearly $80 each.
Financial Challenges
The downward trend in Trump Media’s stock price was catalyzed by revelations of financial struggles. The company disclosed operational losses totaling nearly $16 million in 2023, coupled with interest expenses of $39.4 million, despite generating only $4.1 million in revenue. A year prior, in 2022, Trump Media reported operational losses of $23.2 million and interest expenses of $2 million on revenue amounting to $1.5 million.
According to filings with the Securities and Exchange Commission, Trump Media acknowledged its financial vulnerabilities and admitted to lacking the necessary resources to sustain its operations over the long term. The company expressed uncertainty about its ability to persevere, stating that it anticipates continued operational losses and negative cash flow in the foreseeable future.
In light of these challenges, Trump Media faces an uphill battle in stabilizing its financial position and securing its future sustainability in the competitive media and technology landscape.
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