(NEW YORK) — Shares of former President Donald Trump’s social media platform dropped more than 20% on Monday after the company disclosed a net loss at the end of last year of more than $58 million.
The decline erased $2 billion in value and, with it, the value of Trump’s majority stake of 57%.
Before Trump Media and Technology Group joined forces with a shell company to go public last week, “management had substantial doubt that TMTG will have sufficient funds to meet its liabilities as they fall due,” the company said in a regulatory filing.
The company also conceded that “TMTG’s success depends in part on the popularity of our brand and the reputation and popularity of President Trump. The value of TMTG’s brand may diminish if the popularity of President Trump were to suffer.”
The performance represented a reality check for a stock that was initially boosted by the enthusiasm of Trump’s supporters. On Monday share’s closed at about $48, down about 21%.
Trump’s stake, on paper, is still valued at more than $3 billion.
Trump is not allowed to sell or borrow against any of his shares for six months. He could ask the board of the directors for a waiver of that so-called lockup provision, but any attempt by Trump to alter that agreement could trigger more selling.
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