In a recent photo illustration by Scott Olson/Getty Images, the Republican presidential candidate former President Donald Trump’s social media platform Truth Social is depicted on a cell phone in Chicago, Illinois. The image highlights the platform’s presence and reach.
Truth Social, the social media platform owned by Trump Media & Technology Group, has been valued at up to $11 billion on Wall Street. However, recent reports have raised doubts about its true worth. According to New York CNN, Trump Media reported a significant loss of $58.2 million in 2023 with minimal revenue generation. These numbers have led experts to compare it to the meme stock craze.
In a regulatory filing, Trump Media reported a significant loss of $58.2 million in 2023 compared to the $50.5 million profit in 2022 and generated a modest revenue of $4.1 million, showing slight improvement from the previous year of $1.5 million. The company’s accountants have expressed concern about its financial stability and warned that it might not survive unless it completes its merger to go public soon, bringing an influx of $300 million in cash.
Despite these financial struggles, Truth Social has been gaining popularity among conservative users who want an alternative to platforms like Twitter and Facebook that they believe are biased against their views. However, rival social media platforms like X have reported significantly higher revenue numbers and user bases compared to Truth Social, highlighting the growing competition and obstacles faced by this new platform in maintaining its user base.
In conclusion, while Trump Media has been valued at up to $11 billion on Wall Street based on its multibillion-dollar valuation, recent reports suggest that this valuation may be overestimated due to concerns about its financial stability and declining user base on iOS and Android devices. As such, investors should proceed with caution when investing in this company’s stock until further information becomes available regarding its financial health and long-term viability as a going concern.