Trump’s media and technology group Shares fell 4% on Monday morning after disclosing another quarterly loss that continued to cast doubt on the company’s ability to turn a profit.
The company behind former President Donald Trump’s social media platform Social Truth reported a net loss of $16.4 million in the second quarter on Friday. About half of the loss, or $8.3 million, was due to legal costs tied to its Merger with Digital World Acquisition Corp. (DWAC), a special purpose acquisition company or SPAC.
Revenue fell to $836,900 from $1.19 million a year earlier, a 30% hit. Trump Media attributed the decline to “a shift in revenue share with one of our advertising partners” and its testing of “a nascent advertising initiative” on Truth Social.
He faced a number of “significant costs,” including $602,000 in accounting fees that included the cost of re-audit the company’s fiscal year 2022 and 2023 results after his The previous auditor was permanently disqualified by the Securities and Exchange Commission.
As of August 9, the former president owns 59.9% of the outstanding shares of the company’s common stock, making him the majority shareholder. Rather than pursuing a traditional IPO, Trump Media went public by merging with DWAC in March, after years of delays.
Trump Media shares traded at $25.22, bringing the company’s market capitalization to $4.84 billion. Despite the high valuation, the company has consistently lost money. In May, reported a pre-tax loss of $327.6 million for the first quarter and just $770.5 million in revenue.
Devin Nunes, the company’s chief executive, touted the company’s accomplishments in a statement Friday, including the Launch of its live TV streaming platformTruth+, which began rolling out earlier this month. The streaming platform will initially include news, commentary, weather, lifestyle and entertainment channels. The company has said it will have full control over its technology distribution stack for streaming through a private content delivery network.
“From the beginning, our intention was to make Truth Social an impenetrable platform for free speech, and by taking extraordinary measures to minimize our dependence on Big Tech, that is exactly what we are doing,” Nunes said.
In addition to developing Truth+, Nunes said the company is also exploring “numerous other growth possibilities, including mergers and acquisitions.” Trump Media had $344 million in cash and cash equivalents with no debt as of June 30, the company said in a statement. regulatory submission.
“With its strong balance sheet and zero debt burden, the Company believes it has sufficient working capital to fund operations for the foreseeable future,” the company said.
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