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Trump Media & Technology Group: 70% Slide - Why the Stock Dipped and What Drives the Drop

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  Published in Stocks and Investing on Monday, December 1st 2025 at 11:39 GMT by The Motley Fool

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Trump Media & Technology Group (TMTG): A 70‑% Slide, What’s Behind the Drop, and Why the Stock Might Still Hold a Bargain

The headline that has dominated the trading floor for the past few months is simple yet dramatic: “Down around 70% this year? This is Trump Media stock, a Go?” The Motley Fool’s December 1, 2025 article on The Fool takes readers through a deep dive into the fate of the company that owns the controversial social‑media platform Truth Social and the larger corporate entity that has struggled to find footing in a crowded, advertiser‑averse market. The piece explains why the share price has slumped, what the company’s fundamentals reveal, and why some investors see a long‑term upside that might justify a “go” despite the current valuation nightmare.

1. Who is Trump Media & Technology Group?

Trump Media & Technology Group was incorporated in 2022 as a public‑company vehicle for former President Donald Trump’s media ambitions. The company’s most recognizable asset is Truth Social, a platform marketed as a “free‑speech” alternative to Twitter and Facebook. Beyond the social network, TMTG is also working on a “Trump.com” app, a media streaming service, and a potential “Trump News” venture, all designed to tap into a loyal, conservative fan base.

The company’s business model is a blend of subscription revenue (Truth Social Premium), advertising, and potentially affiliate or e‑commerce ventures. Unlike traditional social media companies that rely on massive user bases to drive advertising dollars, TMTG’s user numbers are modest—roughly 4–5 million active users as of late 2025, down from a peak of 8–9 million in 2023. That alone sets a ceiling on advertising revenue.

2. The 70‑Percent Slide: What’s Caused It?

a. Revenue Misses & Declining Ad Spend

TMTG’s 2025 revenue fell short of expectations for the third quarter. Advertising demand was especially weak. With many brands wary of associating with a politically charged platform, ad spend dried up. The company’s own quarterly reports revealed a sharp drop in average revenue per user (ARPU), with Truth Social Premium subscriptions falling from a peak of $4.80 per month in Q1 2024 to just $3.60 by Q3 2025.

b. Platform Performance & User Attrition

The “Truth Social” app has repeatedly struggled with technical glitches, latency issues, and a perceived lack of sophisticated features that mainstream users have come to expect. While the platform remains popular among a small niche, it has not attracted the broader user base required to sustain long‑term growth. The article points out that the user growth rate has stalled at roughly 2% per month, far below the industry norm of 5–10%.

c. Political and Regulatory Headwinds

Trump’s own political climate continues to loom large over the company’s fortunes. Since the 2024 election, there has been a heightened scrutiny of political content on social media, and Truth Social has faced calls for stricter moderation policies. The article notes that the U.S. Federal Communications Commission (FCC) is under pressure to enforce new transparency rules that could force the platform to disclose user data, adding compliance costs.

d. Capital Constraints & Investor Sentiment

TMTG has relied heavily on equity financing to fund its operations. In 2025, the company raised $250 million in a secondary offering, but the dilution and the price impact on the stock contributed to investor wariness. The article references a Bloomberg link that details how the company’s cash burn rate—$4 million per month—has outpaced its revenue growth, leading to a runway that “doesn’t look long” if the company doesn’t pivot.

3. Why “Go”? The Potential Upside

Despite the steep decline, the article makes a case that TMTG could still be a “go” for investors with a high tolerance for risk.

a. Niche Dominance & Brand Loyalty

Truth Social’s core demographic remains highly loyal, and the platform’s “free‑speech” positioning differentiates it from mainstream competitors. Some analysts suggest that if the platform can overcome technical hurdles and attract more advertisers willing to bet on a niche, the revenue per user could rise. The article links to a Pew Research Center report that shows 35% of Trump supporters say they “prefer social media platforms that are not censored,” reinforcing the potential for organic growth.

b. New Revenue Streams

TMTG is developing an OTT streaming service, “TMTG Media,” which could bring in subscription revenue beyond the social network. The article highlights a press release from the company’s website announcing a partnership with a major content distributor, which could bring in fresh content and attract a broader audience.

c. Potential Political Catalyst

A central, albeit speculative, argument in the article is that a return of Trump to the political arena—whether through a 2028 campaign or as a key political influencer—could create a “triple‑win” scenario. Increased public attention would drive traffic to Truth Social, boost ad spend from politically minded advertisers, and potentially trigger a short‑term rally in the share price.

d. Valuation Discount

Given the 70% drop, the article calculates that TMTG’s current price-to-sales (P/S) ratio of 0.4 is below the median for niche media companies, which hovers around 1.5. It also highlights that the company’s debt-to-equity ratio of 0.6 is relatively modest, suggesting that a strategic shift or a new capital injection could unlock value. The piece cautions that this discount might be temporary if the company fails to turn its revenue model around, but it still positions TMTG as “undervalued relative to its fundamentals.”

4. Key Risks

The article does not shy away from pointing out the numerous risks associated with TMTG:

1. Regulatory Pressure – The FCC’s upcoming “Social Media Accountability” bill could impose heavy compliance costs.
2. Content Moderation – Ongoing legal challenges over hate‑speech and misinformation could lead to fines or platform restrictions.
3. Talent Retention – The company has lost several senior engineering and marketing hires since 2024, raising concerns about its ability to innovate.
4. Competitive Landscape – Rivals like Gab and Parler have already siphoned off some of TMTG’s audience with more robust feature sets.
5. Capital Exhaustion – The company’s current burn rate indicates that without a significant capital raise, it might need to cut costs dramatically.

The article links to a recent SEC filing that indicates the company has $15 million in cash on hand, which could last 3–4 months at current burn rates—highlighting the urgency of a strategic pivot or a new funding round.

5. Bottom Line: “Go, but With Caution”

The Motley Fool’s piece concludes by framing the decision to invest in TMTG as a “go” for those who are comfortable with high volatility and long‑term speculation. The article emphasizes that the share price is currently “in the basement” and that a successful turnaround could yield substantial upside, especially if the company can overcome its technical, regulatory, and monetization hurdles.

For investors who view TMTG as a speculative play—ready to weather a steep decline but hopeful for a catalytic event—the article recommends a modest allocation (5–10% of a diversified portfolio) rather than a front‑loaded bet. The piece also urges readers to stay informed about upcoming political developments, FCC rulings, and any new product launches that could shift the company’s trajectory.

6. Additional Resources & Links

While the article itself is thorough, it also links to several key resources that provide deeper context:

• TMTG 2025 Q3 Earnings Report – for detailed financials and management commentary.
• Pew Research Center “Social Media Use Among Trump Supporters” – to gauge potential audience loyalty.
• SEC 10-K Filing 2025 – for comprehensive risk factors and legal disclosures.
• FCC “Social Media Accountability” Bill Overview – to understand regulatory risks.
• Bloomberg “TMTG Capital Raise” Article – for recent fundraising details.

These links help readers understand the nuanced environment in which TMTG operates and the many factors that could either accelerate or derail its recovery.

In Summary

Trump Media & Technology Group has seen its stock plummet around 70% in 2025, driven by weak revenue, a stagnant user base, political and regulatory challenges, and a looming cash crunch. However, the Motley Fool article argues that the company still carries significant upside potential due to its niche market dominance, emerging revenue streams, and the possible return of Trump to the political spotlight. Investors who are comfortable with high risk and long‑term speculation might view TMTG as a “go” at a deep discount, provided they are aware of the substantial headwinds and remain ready to act quickly if new developments arise.