Trump Media and Technology Group (DJT) Launches $400 Million Share Buyback Program Despite Minimal Revenue

This article does not constitute investment advice. The author does not hold any shares in the stocks mentioned herein.

Trump Media and Technology Group Launches $400 Million Share Buyback Program

Trump Media and Technology Group (NASDAQ: DJT), known for its Truth Social platform and a range of forthcoming exchange-traded funds (ETFs) and separately managed accounts (SMAs) under the Truth. Fi brand, has officially initiated a significant share buyback program valued at approximately $400 million.

Details of the Buyback Initiative

The company recently released a press statement confirming that its board of directors has authorized this substantial repurchase plan. The communiqué elaborated that:

“The repurchases, comprising either stocks or warrants, would be conducted through open market transactions, with repurchased shares to be retired by the company.”

The strategic buyback will be executed through open market operations, allowing the company discretion over the timing and volume of repurchases.

Market Context and Financial Insights

With Trump Media’s current market capitalization sitting at $4.94 billion, this initiative could potentially allow for the repurchase of about 12.35 million shares. For reference, the firm’s current trading float amounts to 121.43 million shares.

Despite this ambitious buyback initiative, it’s essential to note that Trump Media and Technology Group has reported minimal revenue. According to the last publicly available data for the year ending December 31, 2024, the firm generated just $3.6 million in sales. A closer examination reveals that when excluding amortization of deferred revenue, actual billings were around $200, 000. This decline in unearned revenue on the balance sheet, which decreased from $4.41 million to $1.01 million by the end of 2024, indicates that the company recognized about $3.4 million in unearned revenue against the reported $3.6 million in sales.

Future Selections and Crypto Developments

Recently, Trump Media filed a registration statement with the SEC aimed at launching its Truth Social Bitcoin and Ethereum ETF, which will maintain a 75:25 balance of the two cryptocurrencies. Crypto.com has been designated as the ETF’s custodian, as well as the prime execution agent and provider of staking and liquidity services. The company also has plans to introduce multiple ETFs and SMAs via its Truth. Fi brand, leveraging a dedicated funding pool of around $250 million.

Additionally, Trump Media and Technology Group successfully raised $2.3 billion through the issuance of 29 million shares in underlying convertible notes and a further equity offering of 56 million common shares, designed to bolster a dedicated Bitcoin Treasury.

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