Former President Donald Trump’s social media venture Truth Social is burning cash and piling up losses so rapidly that accountants warn it might not survive unless it soon completes a long-delayed merger, according to corporate filings.
Trump Media & Technology Group (TMTG), which is chaired by the former president, has lost $31.6 million since the company launched in early 2021, SEC filings released Monday show.
Truth Social launched in early 2022 as an alternative to Twitter, which is now known as X and is owned by billionaire Elon Musk. At the time, Trump had been banned from what was then Twitter for breaking the platform’s rules on promoting violence during the January 6 riot. His account has since been reinstated.
But Trump’s social media platform has struggled to gain popularity, with its 861,000 monthly active users on iOS and Android as of October amounting to barely 1% of those on X, according to Similarweb.
With cash levels dwindling, Trump Media’s management and accountants are warning there is no guarantee the company will stay afloat.
“TMTG has suffered negative cash flows and recurring losses from operations that raise substantial doubt about its ability to continue as a going concern,” the filing said, citing an assessment from an independent accounting firm and financial statements.
Trump Media’s management believes capital raised from the merger will be “sufficient” to retire debt and fund operations, the filing said.
Still, as of the end of June management had “substantial doubt” that the company will have “sufficient funds to meet its liabilities as they fall due,” according to a filing.
Trump Media’s management indicated that having sufficient funds is “directly conditional” on completing its merger by the end of this year and added that additional bridge funding “may be required” before then. Trump Media executives are also in talks with investors about extending debt maturity dates and raising new funds through convertible debt, the filings say.
Trump Media and Digital World said the filing of the financial documents on Monday mark a key step forward towards finalizing their merger.