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Former US President Owns a Company Worth More Than Billionaire Elon Musk's Big Company
Elon Musk is the richest man in the world, with a fortune made up of shares in several successful companies, such as Tesla, SpaceX and X, for example. Donald Trump is also a billionaire, but with a fortune of 4 billion dollars, much smaller than that of his South African counterpart.
However, Truth Social, the social network launched by Donald Trump after his departure from Twitter, has surprised the market with a valuation expressive.
With a recent surge in shares, the platform is now worth more than X Holdings, Elon Musk's company formerly known as Twitter.
While Musk acquired the social network for $44 billion, X is currently valued at around $9,4 billion, according to investment group Fidelity. In contrast, Trump Media and Technology Group (TMTG), which is responsible for Truth Social, is already worth more than $10 billion.
Expansion of Truth Social and appreciation of shares
Truth Social’s rise has been fueled by a significant surge in shares of its parent company, TMTG. Since late September, the company’s stock has risen dramatically, quadrupling in value.
Shares recently rose more than 12% to $53,30. The sharp price swings caused so much movement that the market had to temporarily halt trading to stabilize the price.
This appreciation comes amid growing investor expectations about Trump's possible return to the presidency of the United States. It is noted that TMTG shares tend to reflect Trump's popularity and political chances more than the company's profit-generating potential itself.
Truth Social and TMTG Challenges
Despite the surge in value, TMTG faces significant financial challenges. Based in Sarasota, Florida, the company reported a loss of more than $16 million in the second quarter of this year, generating revenue of just $837 in the period. This scenario shows that Truth Social still has a long way to go to establish itself as a profitable and self-sustaining platform.
Trump created TMTG after being banned from mainstream social media platforms such as Twitter and Facebook following the events of January 6, 2021, at the Capitol. Although he owns 57% of the company, the former president does not play an active role in its management.
Comparison with Elon Musk's X
When Musk acquired Twitter in 2022, the social network was worth approximately $44 billion. However, since the acquisition, the company has seen its market value decline, currently reaching around $9,4 billion. Fidelity, which owns a stake in X Holdings, recently revised the value of its stake, valuing it at just $4,2 million.
Elon Musk, now an outspoken Trump supporter, has invested significantly in his reelection campaign, with amounts exceeding $70 million. Musk has recently held rallies in support of the former president, especially in Pennsylvania, a key battleground state.
TMTG Expansion and Partnerships
Trump Media and Technology Group has been seeking to diversify its operations. TMTG's member companies include Caesars Entertainment, Match Group, Walgreens Boots Alliance and Hasbro, the maker of games such as Monopoly.
These partnerships reflect the group's expansion strategy, which aims to consolidate its presence in the digital market and expand Truth Social's reach.
However, while TMTG and Truth Social are gaining in market value, financial sustainability remains a critical issue for the company. Pressure on TMTG’s management will increase as the platform tries to balance its financial operations with the need for growth.
