Donald Trump’s social media platform, Truth Social, has surged past Elon Musk’s X in valuation following a remarkable rise in the shares of its parent company, Trump Media & Technology Group (TMTG). Now valued at over $10 billion, TMTG’s market cap has quadrupled since late September, putting it ahead of X Holdings, which Fidelity recently valued at around $9.4 billion.
Election Momentum Drives Stock Rally for Truth Social
The stock of TMTG appears closely tied to Trump’s re-election prospects rather than the company’s financial performance. Investor confidence in Trump’s 2024 chances has helped boost TMTG’s stock, which rose nearly 9% on Tuesday to close at $51.51, building on a 21.6% gain the previous day. Trading was so volatile on Tuesday that it was briefly halted several times, marking a substantial rebound from its $12 low just last month.
Trump launched TMTG after being banned from mainstream platforms like Twitter and Facebook following the Capitol riot on January 6, 2021. While he owns 57% of TMTG, he has no active role in running the company.
TMTG Outshines Struggling X Holdings
Although Truth Social’s valuation now outpaces X Holdings and other well-known brands like Caesars Entertainment, Walgreens Boots Alliance, and Hasbro, TMTG has struggled financially. Recent filings show the company lost over $16 million last quarter while generating just $837,000 in revenue. When Musk acquired Twitter (now X) in 2022, it was valued at $44 billion, but recent filings suggest that Fidelity’s Blue Chip Growth fund now values its stake in X at only $4.2 million.
Musk’s Support Adds a New Dynamic
Elon Musk, a vocal Trump supporter, has committed over $70 million to bolster Trump’s re-election efforts and has hosted multiple town halls in his support. Despite their platforms competing for users, Musk’s political backing of Trump adds an interesting twist as both billionaires seek influence over the digital and political landscapes.
