Trump defends Truth Social as media company’s skeptics grow, stock price whipsaws

Donald Trump on Thursday defended his social media platform Truth Social as a growing chorus of critics — and short sellers — view its parent company as a meme stock with a vastly overinflated share price.

Trump, in two lengthy posts on Truth Social, accused the platform’s detractors of being “Radical Left Democrats” who are trying to convince others “that TRUTH is not such a big deal and doesn’t ‘get the word out’ as well as various others, which they know to be false.”

“I THINK TRUTH IS AMAZING!” Trump wrote, echoing a statement earlier this week from Devin Nunes, CEO of the app’s parent company, Trump Media & Technology Group, that it has “no debt and over $200 million in the bank.”

“More importantly, it is the primary way I get the word out and, for better or worse, people want to hear what I have to say,” Trump wrote.

In addition to being a megaphone for the presumptive Republican presidential nominee, the platform is Trump’s path to a potentially massive financial windfall.

Trump owns 78.8 million shares of the company, a 57.3% stake worth more than $3.6 billion at the firm’s share price of $46 on Thursday morning. Trump has to wait until a six-month lockup period expires before he can sell any shares.

But it’s far from clear how the volatile stock will fare during that interval, and Trump Media’s long-term business plan has spurred scores of skeptics.

Trump Media has become by far the most expensive stock in the U.S. to sell short, according to data firm S3 Partners. The annual financing costs required to borrow DJT shares to short were between 750% and 900% of the stock price as of Wednesday, S3 reported.

The company, trading under the stock ticker DJT after completing a lengthy public merger, shot up by as much as 50% in its Nasdaq debut last week. But the stock plunged by 21% on Monday, after the company reported a $58.2 million net loss on revenue of just $4.1 million in 2023.

DJT was down more than 5% as of 10:30 a.m. ET on Thursday. Still, the company boasted a market cap of about $6.2 billion.

The company’s cachet is inextricably tethered to the status and continued relevance of Trump, its founder and public face. Trump on Thursday morning even seemed to identify himself as Truth Social’s main draw.

But the former president faces several political, legal and financial challenges, all of which could diminish his standing as a public figure, and in turn, erode the value of Trump Media.

Meanwhile, the company said in a recent regulatory filing that it is not divulging key performance indicators — such as signups, average revenue per user, ad impressions or active user accounts — because those metrics could distract the company and “might not align” with its long-term goals.

Trump Media said it might eventually change its mind and report that data, but it also “may never collect, monitor, or report any or certain key operating metrics.”

Trump’s own posts acknowledged that his following on Truth Social is vastly diminished from those he once enjoyed on much larger rival platforms, such as X, where he had more than 87 million followers.

That company and others banned Trump in the wake of the Jan. 6, 2021, Capitol riot by a violent mob of his supporters, which followed months of Trump using social media to spread false claims of election fraud. X reinstated Trump’s account after Tesla CEO Elon Musk bought the company, but Trump has not resumed regular tweeting.

Trump said his roughly 7 million followers on Truth Social is “very good for a startup, and growing fast.”

Truth Social saw roughly 5 million visits in February, according to an estimate by research firm Similarweb reported by the Associated Press. Facebook, in comparison, reported more than 3 billion monthly active users as of the end of 2023.

If the platform didn’t work, he added, “I wouldn’t use it – But it does work, and work really well – And the fun is just getting started!!!”