Trump Media's Stock Tumble Erases Over $3 Billion from Trump's Fortune

Trump Media faces sudden downturn amid new strategic moves.

by Nouman Rasool
Trump Media's Stock Tumble Erases Over $3 Billion from Trump's Fortune
© Curtis Means-Pool/Getty Images

The parent company of Truth Social, Trump Media & Technology Group, saw its stock value crash, wiping billions of dollars off Donald Trump's net worth. The former president holds about 57% of the company and has seen the value of his stake in the firm plunge from a peak of $5.11 billion in late March to just $1.78 billion as of recent trading sessions.

This sharp fall had come after Trump Media went public, with a market capitalization of $8.97 billion. The sold-out market, which greeted Trump with a fervor that propelled him into the club of the world's richest men for a brief while, was abetted by heavy interest from high-profile institutional investors and speculative traders lured by what they termed as the "Trump bump."

Rapid Stock Decline

But the upturn didn't last long.

The steep decline for Trump Media shares started after the company made an announcement that it would enable insiders, including Trump, to sell shares earlier than anticipated. That came to light through a regulatory filing, which also shows a six-month lock-up period that would bar insiders from selling their holdings.

In its turn, the stock went to the next significant low following the company's announcement about its decision to launch a new platform for streaming. By Tuesday, Trump Media's market cap had shrunk to about $3.12 billion, a stark 65% fall from its highest valuation.

The dramatic drop represents a big hit to Trump's personal financial landscape, particularly at a time when he is paying increasing legal bills. With his first criminal trial beginning thisjson charges of hiding hush-money payments to a porn star, the timing is hardly good.

Trump Media's financial reports also painted a adverse picture of his businesses, disclosing a loss of $58 million last year against modest revenue of $4.1 million. Still, the stock had cut a healthy, if reduced, profit for Trump, who is seen by many as the leading contender for the Republican nomination in 2024.

So, as Trump pilots these tricky financial and legal waters, investors and political analysts are all eyes to see how this may or may not bruise him and how it could affect his political and financial future. The situation developing around this case highlights the unhealthy, volatile nature of meme stocks.