In a surprising turn for the social media world, Donald Trump’s Truth Social has surged past Elon Musk’s X (formerly Twitter) in market value, marking a dramatic shift in fortunes for the two platforms. According to recent valuations, Trump Media & Technology Group (TMTG), Truth Social’s parent company, is now worth over $10 billion—overtaking X Holdings, which Fidelity recently valued at $9.4 billion.
Trump’s Truth Social, launched in response to his bans from mainstream social platforms, has experienced an astounding market surge since late September, with shares more than quadrupling in value. Analysts attribute this rapid rise not to profitability but to a groundswell of investor interest fueled by Trump’s growing influence in the GOP and his role as the Republican presidential nominee facing off against Democratic candidate Vice President Kamala Harris.
Tuesday trading saw TMTG stock soar by 9 percent to close at $51.51, following a massive 21.6 percent increase the previous day. Trading was so intense that it triggered multiple pauses on the stock exchange, an unexpected boom considering its recent lows near $12 just last month.
However, behind the scenes, Truth Social faces considerable financial and operational challenges. The company reported losses of over $16 million in the quarter ending June 2024, while generating only $837,000 in revenue. Recent regulatory filings from the Associated Press reveal that the company’s Chief Operating Officer, Andrew Northwall, resigned last month. Additionally, TMTG is required to transfer nearly 800,000 shares to an investor as a result of a court ruling, casting shadows over the company’s internal stability even as its valuation soars.
Despite these hurdles, TMTG’s valuation has vaulted it above not only X but also other well-known companies like Caesars Entertainment and Hasbro. The valuation gap with X is especially notable given Musk’s initial Twitter acquisition price of $44 billion in 2022. Since then, Fidelity’s Blue Chip Growth fund values X at approximately $4.2 million, a staggering decline as the platform faces mounting criticism and challenges under Musk’s ownership.
Musk’s X, once a global force in social media, has been plagued by issues ranging from falling ad revenues to user dissatisfaction. Nevertheless, Musk remains a strong supporter of Trump’s 2024 campaign, contributing over $70 million and making public appearances in support of the former president.
With Truth Social now in the lead in terms of market value, the spotlight is on Trump’s platform. Will TMTG’s surge prove sustainable, or is it a reflection of Trump’s political moment in the limelight? As the social media battlefield intensifies, the valuation gap between Truth Social and X may set the stage for further seismic shifts in the industry.
Sources for this article include Fidelity, TMTG regulatory filings, and the Associated Press.
