Barry Diller Slams Trump Media as “A Scam”
The financial world has been buzzing with discussions about Donald Trump’s recent venture into media, which saw the company’s valuation skyrocket to $6.5 billion. Amidst this, Barry Diller, Chairman of IAC and Expedia, shared his critical perspective in a CNBC interview, dismissing Trump Media as a “scam” and questioning the rationale behind the investments in its stock.
Trump Media, which recently made headlines following its public debut under the ticker DJT, experienced a dramatic surge in stock prices. Initially trading at nearly $80, it has seen its value adjust, trading around $47 as of the latest reports. Despite the hype surrounding its launch, skepticism looms over its financial health and business model.
Trump Media’s portfolio, primarily anchored by the Truth Social app, reported modest revenues, generating just $4.1 million last year, and disclosed net losses of $58 million in 2023. Despite these figures, it holds an ambitious market capitalization of $6.4 billion.
Diller’s criticisms extend beyond the financial underpinnings, likening the investment frenzy to the “meme stock” craze of 2021, which saw stocks like GameStop and AMC Entertainment reach improbable valuations. He expressed disbelief in the company’s value proposition, criticizing investors for buying into what he views as a lackluster business.
Addressing the possibility of Trump Media’s growth, especially if Trump were to become president again, Diller was dismissive. He expressed skepticism about the company’s future performance and significance, suggesting Trump’s current influence is more about entertainment than business viability.
The company’s stock faced turbulence, dropping by over 21% following revelations about its financial struggles. Despite a slight improvement in revenue in 2023 compared to 2022, its substantial losses have led to investor caution.
Trump Media’s entry into the public market was facilitated by a merger with Digital World Acquisition Corp., marking its debut on the Nasdaq under the DJT ticker. While its initial trading days showed promise, the stock has since seen a retreat, hinting at the market’s reevaluation of its long-term prospects.
In response to Diller’s comments, a representative for Trump Media countered, emphasizing the company’s commitment to providing a platform for uncensored political expression, whilst suggesting criticism stems from political bias. This paints a vivid picture of the polarized perspectives surrounding Trump Media’s market debut and future.
The unfolding narrative around Trump Media and its stock performance continues to captivate observers, reflecting broader debates about market speculation, political influence, and the valuation of tech and media enterprises.
