Why is Trump failing?

February 21, 2025

Why is Trump failing?

Sorry for the click bait. This post is not about politics. It's about the Trump Media & Technology Group Corp. (NASDAQ: DJT). The stock keeps losing value every day. falling  is experiencing a decline in its stock price, trading at $27.51 per share, down approximately 1.19% from the previous close.

Trump Media & Technology Group Corp began trading on the Nasdaq Stock Market under the ticker symbol "DJT" on March 26, 2024, following its merger with Digital World Acquisition Corp. DJT has experienced notable fluctuations. As of **February 21, 2025**, Trump Media & Technology Group Corp. (NASDAQ: DJT) is trading at **$27.18** per share, with a market capitalization of approximately **$5.97 billion**. citeturn0search14

On that day, the stock achieved a peak intraday stock price of $66.22 per share. With approximately 216.9 million shares outstanding then, the market capitalization was approximately $14.36 billion. The stock began to experience fluctuations. As of February 21, 2025, DJT's stock is trading at $27.20 per share, resulting in a market capitalization of approximately $5.97 billion. This represents a significant decline of about 59% in both stock price and market capitalization from the peak values observed in March 2024. 

In the second half of 2024, DJT's stock reached its peak intraday price of $79.38 on October 15, 2024, three weeks before the presidential elections. With approximately 216.92 million shares outstanding, this equated to a market capitalization of about $17.22 billion at that time. Compared to today's closing price of $27.18, this reflects a decline of approximately 66% from the October 2024 peak.

Several factors have contributed to the recent downturn in DJT's stock performance:

The most important factor is that Trump Media & Technology Group sucks for lack of a better term. Despite its substantial market valuation, the company has reported modest revenues and huge losses. The company's flagship product or service is the social media platform Truth Social. This is an "anti-woke" copy of Twitter (now X) started by Donald Trump when he was expelled from Twitter. 

As of early 2025, Truth Social faces significant challenges in user engagement, branding, and revenue generation. Truth Social has approximately 2 million active users, a very modest figure compared to major social media platforms. For example, Facebook has approximately 3.07 billion users; YouTube has around 2.53 billion; Instagram has around 2 billion; TikTok has about 1.59 billion; LinkedIn has about 1.2 billion; Snapchat has about 850 million; and X has about 619 million. 

Truth Social's user base is predominantly composed of men (64.07%) and skews older and heavily conservative. User engagement peaked a couple of years ago in August 2022 and has been declining since. Truth Social generates income through paid advertising, aiming to attract advertisers seeking to reach the "anti-woke"audience. 

In 2024, TMTG reported a 12% decline in annual revenue, totaling $3.6 million, and reported a net operating loss of $400.9 million in the same year, partly attributed to a revenue-sharing agreement with an undisclosed advertising partner. In the third quarter of 2024, the company disclosed earnings of just $1.01 million, raising questions about its financial sustainability and leading some investors to reassess their positions.

Other factors playing against DJT is that there has been significant profit taking from many investors, including significant sales from insiders. Following significant gains, many investors have opted to secure their profits, leading to increased selling pressure. This behavior is common when a stock experiences rapid appreciation, as shareholders aim to lock in gains amidst market volatility. Key executives have recently sold significant portions of their holdings. Notably, three insiders, including the Chief Financial Officer, liquidated shares totaling $16 million. Such insider selling can signal potential concerns about the company's future prospects, prompting caution among investors. 

In summary, Truth Social confronts considerable obstacles in expanding its user base, enhancing engagement, and improving financial performance. The platform's limited reach, coupled with substantial financial losses, underscores the need for strategic adjustments to achieve sustainable growth and profitability. The decline in DJT's stock price can be attributed to a combination of Truth Social's poor performance, stock sales for profit-taking, insider selling activities, concerns over financial health, and broader market dynamics. 

What could save DJT?

Using Trump's clout to acquiring other companies and ventures to diversify away from Truth Social may be the best strategy for DJT to grow and increase value to its shareholders. Truth Social seems to be on a dead end with no real possibility of becoming anything major or mainstream in social media that could justify a multi-billion dollar valuation for DJT. 

Is DJT buying TikTok US?

On February 21, 2025, DJT announced that its board approved a merger and acquisition (M&A) resolution authorizing DJT to pursue financing for the acquisition of other companies. As DJT shareholders, we are hopeful that this could mean that Trump is buying a piece of TikTok U.S. Acquiring a piece of the action on TikTok could give DJT a lift. Judging from the market's negative reaction to the news (DJT lost another 3% today), it seems that there is no basis to speculate that DJT will acquire TikTok. We'll see. In the meantime, you are better off staying as far as possible from buying DJT. The Creatix fund made the huge mistake of buying DJT back in October 2024. We are down 40% on the position. We are holding onto it, willing to lose 100% just to prove the point of Trumps' Touch, everything that Trump touches turns to shit, fraud, or both sooner or later.

Now you know it. 

www.creatix.one