Trump Media & Technology Group, the owner and operator of the social media platform Truth Social, recorded another unprofitable run in 2024. Not only did it fail to book a profit but it also incurred losses. The official and final annual report specifically indicated USD 400 million in net losses. The startup media and tech company has been unprofitable since it was founded in 2021 and has been recording net losses year after year.
Specific details of the annual report showed that it earned USD 3.6 million in revenue for 2024 or a 12 percent decline from its USD 4.13 million 2023 revenue. The company also saw its net loss widen to USD 400.9 million in 2024 from USD 58.2 million in 2023.
The company cited two reasons for its poor 2024 performance in a statement. The first was the legal fees it incurred from merging with the special-purpose company Digital World Acquisition Corp in March 2024. It noted that this legal obligation was an obstruction from the Securities and Exchange Commission under the Biden administration. The second was due to a new revenue-sharing agreement with an undisclosed advertising partner.
Current and earlier explainers on its annual reports noted that Trump Media & Technology Group is still a startup company in its early development stage. It remains focused on long-term product development rather than immediate revenue and profit generation.
However, considering the fact that Truth Social is its flagship product, the company is struggling to monetize this social media platform. Digital advertisements have been limited to niche products like the controversial drug ivermectin, conservative dating sites, and branded merchandise. There are no big advertisers purchasing ad spaces. It also has lower general appeal compared to social media platforms like Facebook and TikTok.
The user base of Truth Social is also dependent on the popularity of Donald Trump. There was an initial interest during its first two years but this has not translated into sustained user engagement. It remains a niche social media platform with limited appeal.
It is also worth noting that the Trump Media & Technology Group has a volatile stock price and unstable stock performance. It has specifically exhibited meme-stock behavior as evident from how its stock price moves according to social media buzz and political events. People are investing according to trends rather than financial fundamentals. This limits its access to capital and leaves it with no choice but to depend on debts.
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