TruthSocial made Trump billions. Will its skyrocketing stock price solve his financial woes?

Trump’s social network has made him one of the richest people in the world — at least on paper.

A smartphone screen shows the logo of the Truth Social app.
Will TruthSocial deliver the windfall Trump needs?
Anna Barclay/Getty Images

Nicole Narea covers politics and society for Vox. She first joined Vox in 2019, and her work has also appeared in Politico, Washington Monthly, and the New Republic.

Former President Donald Trump’s net worth has skyrocketed to about $7.5 billion since Trump Media, the parent company for his social network Truth Social, went public earlier this week.

The question for Trump’s presidential bid — and his various legal troubles — is whether he can actually cash in on those gains.

His 2024 campaign and the Save America political action committee supporting it have posted dismal fundraising numbers in recent months. Trump is also facing a fast-approaching deadline to post a $175 million civil fraud bond in the New York case involving his inflation of the value of his real estate holdings.

Trump Media’s initial public offering could theoretically help solve these problems: Trump’s stake in the company is worth about $4.8 billion at its current stock price, according to Barron’s.

Traded under the ticker symbol “DJT,” the company’s stock price surged to $77.27 on Tuesday, coming down to a still impressive $61.96 by the time markets closed Thursday. Its price is well above that of Reddit, a nearly 20-year-old social media company that had a much larger user base (hundreds of millions of monthly active users vs a paltry one million for Truth Social) and more sophisticated revenue model when its stock went public last week.

Whether that windfall proves to be Trump’s saving grace, however, depends on how long the good times keep rolling for DJT — and if Trump can sell his shares without triggering a downward spiral.

Trump’s financial troubles, explained

Trump may now be one of the world’s 500 richest people, as Bloomberg declared after Trump Media started trading. But that doesn’t necessarily mean he has a lot of cash to spare.

In February, his official campaign fund and the Save America PAC raised a total of $15.9 million and ended the month with over $37 million on hand. That’s far behind President Joe Biden’s campaign, which raised $26 million on Thursday night alone at an event in New York with former Presidents Barack Obama and Bill Clinton — a record for a single political event.

Trump has now resorted to selling special edition Bibles as a fundraising tactic. Never one to be outdone, he is also aiming to surpass the record set by Biden at a April 6 fundraising event in Palm Beach, where he’s targeting a $33 million goal.

He’s also gotten some relief. Trump no longer has to pay the $464 million bond previously ordered in the New York civil fraud case against him, which his lawyers revealed he would not be able to post after being rejected by 30 insurance companies. On March 25, the judge in the case reduced the bond amount to $175 million and gave him a 10-day extension to post it. Trump has said he will do so. Otherwise, the state could seize some of his New York properties.

But paying the bond will leave him short on cash, which may be why he is looking to TruthSocial for a windfall.

Why TruthSocial might not be a cash cow

Since the IPO, Trump Media stock has been experiencing the high volatility that is characteristic of meme stocks, a kind of social media-driven financial speculation that was made famous by Gamestop.

But Trump Media stock is different from other meme stocks in an important way: its value is divorced from its business results, said John Rekenthaler in an analysis for Morningstar, where he is vice president of research.

“As with bitcoin, people buy Trump Media not for future cash flows but because: 1) they expect its price to rise, and 2) they feel an affiliation for the asset,” Rekenthaler said. For shareholders, it’s a way “they can express their beliefs and commitment.”

That’s a good thing for Trump, given that TruthSocial’s business results are in the gutter. The company reported $49 million in net losses in the first nine months of 2023, and it relies on a doubtful business model. Users don’t seem to want to pay for memberships and TruthSocial therefore has to rely on advertising. But the platform purports to be a free speech haven, and that can scare away advertisers who don’t want their brand appearing alongside controversial or illicit content.

The lack of financial viability didn’t matter as much before Trump Media went public; TruthSocial still served its purpose by giving Trump a platform and encouraging rank-and-file conservatives to abandon other social media.

But now profitability is a much more urgent question — not only for the DJT stock price but for Trump’s ability to take advantage of the windfall he has enjoyed on paper.

Post-IPO, major Trump Media shareholders — including Trump — won’t be able to sell their stock for a period of six months. Such “lock-up” periods are designed to help companies get their footing after going public. If Trump tries to circumvent the lock-up, other shareholders could sue by arguing that his selling off stock triggered a decline in the stock price, causing them to sustain losses.

But with the deadline to post bond nearing, Trump may need the money before the lock-up period ends. And by the time the six-month window is up, the price of those shares may have come back down. Tom Hulick, CEO of Strategy Asset Managers, a private advisory firm, told Barron’s that DJT “doesn’t meet the characteristics of a high quality” stock that would sustain its current value over the long term.

It’s also not clear if he could actually sell without tanking the stock. He would need to find willing buyers, and even if he does, dumping all of his shares at once could tank the stock price, therefore devaluing them.

Nevertheless, Trump has often defied conventional wisdom, and by extension, so could TruthSocial. This is a social media network owned by an ex-president with an ardent base of supporters who is currently ahead in the runup to the 2024 election according to the polls.

“Predicting DJT’s fortune is like predicting the direction of bitcoin,” Rekenthaler said. “Others may try, but not me.”


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