The company behind Donald Trump’s social media platform, Truth Social, revealed that it suffered losses exceeding $16 million and generated less than $1 million in revenue during the second quarter of this year.

In its quarterly filing with the SEC, the Trump Media & Technology Group noted that the significant losses were largely due to $8.3 million spent on legal fees associated with their merger completed in March, as well as $3.1 million in technology costs linked to the launch of their new streaming service.

Additionally, the filing reported that the company earned only $837,000 in revenue and received $2.3 million from interest during the same quarter.

“With the launch of TV streaming scheduled for August 2024, the Company believes it has established a solid foundation for generating long-term revenue and increasing value,” stated a Trump Media press release regarding the filing. “With a robust balance sheet and no debt, the Company is confident it has enough working capital to sustain its operations for the foreseeable future.”

Trump Media, which trades under the ticker DJT, has faced a decline in stock prices since mid-July, with a more than 7% drop observed Monday afternoon.

Current Status of Trump Media (DJT)

Volatility and Overvaluation of Trump Media Compared to Meme Stocks

Experts have often likened Trump Media to a meme stock, suggesting that its stock price fluctuations are primarily driven by the collective actions and interests of retail investors.

Founded in 2021, Trump Media emerged after Trump was banned from various social media platforms following the January 6 insurrection at the U.S. Capitol. The company became publicly traded in March through a merger with Digital World Acquisition Corp., a special purpose acquisition company (SPAC). Despite a flashy debut, its stock has been highly volatile, often reflecting the news cycles surrounding Trump.

Analysts have also pointed out that the stock is overvalued compared to other social media firms according to traditional Wall Street metrics.

As of May, Trump Media claimed a net loss of $327.6 million in the first quarter of 2024, with revenue reported at $770,500, based on the filings. Previous regulatory documents indicated the company had operated at a loss in 2023, earning about $4 million while incurring losses exceeding $58 million.

“From the start, our goal was to establish Truth Social as a stronghold for free speech, and by taking significant measures to lessen our dependence on Big Tech, we are achieving that objective,” stated Devin Nunes, CEO of Trump Media, in the press release on Friday.