Early Tuesday morning, Trump Media & Technology Group was declining. The stock remains underperforming notwithstanding the proprietor of Truth Social’s declaration of intention to introduce a fresh live TV streaming network.
In early trading, Trump Media shares were down 8.5% at $24.335.
Trump Media announced on Tuesday that the research and development phase for the inauguration of its network had been concluded.
Chief Executive Devin Nunes said in a statement, “With our streaming content, we intend to provide a permanent home for high-quality news and entertainment that faces discrimination from other channels and content delivery services.”
The organization refrained from providing a specific launch date for the network, but stated that it would be introduced in three stages: initially on mobile devices, subsequently on television.
Truth Social has positioned itself as a more conservative alternative to social media platforms such as Facebook by Meta Platforms and Reddit, but its user base is significantly fewer than that of its competitors. In 2023, Trump Media generated $4.1 million in revenue and incurred a net loss of $58.2 million.
On Monday, the stock declined 18% to $26.61 subsequent to the company’s disclosure of a filing regarding the prospective issuance and sale of millions of additional shares.
As per the filing, a customary document subsequent to the organization’s merger with a special-purpose acquisition vehicle, the existing investors have the ability to sell a combined sum of 146.1 million shares and slightly over four million warrants.
Additionally, Trump Media submitted a submission to sell an additional 21.5 million shares of DJT stock via the exercise of warrants. Until a registration statement with the Securities and Exchange Commission is finalized, the shares cannot be issued.
Former U.S. President Donald Trump, who owns nearly 79 million shares and could gain an additional 36 million shares contingent on the stock’s performance, possesses the majority of the extant shares.
As of Monday’s close, Trump’s current stake in the company was valued at approximately $2.1 billion. This stake was worth over $5 billion at the time of the stock’s March 26 Nasdaq debut, when it experienced a significant price surge.
Trump is prohibited from selling shares of Trump Media until the expiration of a six-month suspension period. However, he may petition the organization’s board, which includes several former members of his administration and one of his sons, to grant him a waiver.
