(News Bulletin 247) – Trump Media and Technology Group, the company that oversees the social network Truth Social, is suffering on Wall Street this Wednesday after the first confrontation between the two candidates for the White House.

Extremely volatile since its IPO on March 26 via a merger with a SPAC (an investment vehicle with no operational activity), Trump Media & Technology Group (TMTG) is still reeling this Wednesday.

Shares of the company that oversees Donald Trump’s social network Truth Social fell 13.2% on Wall Street around 5:30 p.m. on Wednesday, the day after the first debate between the Republican candidate and Kamala Harris, his Democratic rival.

According to several market experts, the current vice president of the United States emerged victorious from this confrontation. However, as Bloomberg pointed out last month, part of the speculation on TMTG is based on the hope that Donald Trump, if he reaches the White House, will use “Truth Social as a megaphone”. And thus boost the number of users and the revenues of the social network.

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Kamala Harris won the debate

“Last night’s debate seems to have gone in Kamala Harris’ favor, according to most pundit commentary and online betting. We’ll see if Harris maintains that lead. After the debate, Harris, as a sign of her strong performance, received the support of mega-star Taylor Swift, comments Sebastian Paris Horvitz, of LBPAM.

“The vice president has successfully caricatured the former president, prompting him to rely on fringe narratives from social media on key issues and surprisingly preventing Trump from going on the offensive on areas where he does well with voters, including the economy and immigration,” Barclays notes.

Let us also recall that TMTG’s financial accounts are – to put it mildly – ​​not very glorious.

The latest results, published on August 9, attest to the extreme fragility of its finances. Over the first six months of 2024, the company had generated only $1.6 million in revenue for a net loss of… $344 million.

John Rekenthaler, an analyst at Morningstar, pointed out in April that “everyone understood” that the company did not have “a significant business outlook” and therefore that investors betting on TMTG were buying the stock more for their “much more personal connection to Trump.” In other words, their political proximity to the Republican candidate for the White House.

Over the past three months, TMTG shares have fallen 60%, wiping out $6 billion of market capitalization (the value of all its shares on the stock exchange). But even its current capitalization – $3.7 billion – appears completely disconnected from its fundamentals.