Trump Media shares tank after company says it could sell more stock
Technology
Trump Media shares tank after company says it could sell more stock
(Reuters) - Shares of Donald Trump's social media company slumped 15% on Monday, extending losses since its IPO, after the company said it could sell millions of additional shares in coming months, including the former president's entire stake.
Trump Media & Technology Group which operates Truth Social, has been volatile since its market debut on March 26, attracting both loyal fans of the former president along with short-sellers who see the stock as wildly overvalued.
The shares have already fallen nearly 60% since it first went public after a blank-check merger with Digital World Acquisition Corp, peaking on its first day at $70.90. Shares were down 15.6% at $27.56 on Monday.
Monday's filing is considered standard after a company's initial public offering. It showed a potential sale of 146.1 million shares, including Trump's stake of 114.8 million shares, divided between the 78.75 million he currently owns and an additional stake he could receive if certain performance-based measures are achieved.
"It's worth noting that if they put up this registration statement for Trump shares, I wouldn't take as a signal of anything," a lawyer told Reuters on background last week.
"It's completely normal to put that up for your stockholders, even when they're locked up for a year," the lawyer said.
Trump, the presumed Republican nominee for president in the November 2024 election, is on trial in a Manhattan court related to hush money payments to a porn star. He has pleaded not guilty.
OpenAI, last valued at $86 billion in a secondary sale, has been trying to diversify its revenue stream since its chatbot ChatGPT quickly gained popularity in late 2022. Sources have said it's on track to achieve the $1 billion revenue target it projected for 2024.
The filing also listed an additional 21.5 million shares that could be sold upon the exercise of certain warrants issued when the company went public.
