 "Trump's Truth Social beats Musk's X in value; what's behind the surge?")
Donald Trump’s social media venture, Truth Social, has overtaken Elon Musk’s X in market valuation, driven by a sharp rise in the parent company’s share price.
According to the Associated Press, Trump Media & Technology Group (TMTG) now holds a valuation exceeding $10 billion, with its stock more than quadrupling since late September. In comparison, X Holdings — formerly Twitter — is valued at approximately $9.4 billion, based on Fidelity’s recent assessment of its investment.
Influence of Trump’s re-election prospects
TMTG’s stock tends to react strongly to the former president’s re-election chances, with recent positive developments in his campaign contributing to a surge in investor confidence. On Tuesday, shares in TMTG rose nearly 9 per cent to $51.51, adding to a 21.6 per cent increase seen on Monday (October 28). Due to the stock’s volatility, trading was temporarily halted several times that morning. In contrast, last month the stock hovered around $12.
Trump established TMTG after being removed from major social media platforms, including Twitter and Facebook, following the January 6 Capitol riot. Although Trump owns a 57 per cent stake, he does not actively manage the company. Based in Sarasota, Florida, TMTG continues to face financial challenges, with significant losses reported. In the quarter ending June, the company reported a $16 million loss against revenue of just $837,000.
X’s declining valuation
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When Elon Musk purchased Twitter in October 2022, the company was valued at approximately $44 billion. However, Fidelity’s latest assessment places X Holdings’ current valuation at around $9.4 billion.
As X’s financial situation worsens, the company has taken steps to cut costs, including relocating its headquarters from San Francisco, California, to Bastrop, Texas. X’s stock rose by about 22 per cent right after Elon Musk announced plans to buy the company, then still called Twitter.
However, the stock value dropped again after Musk made several controversial changes. The biggest was rebranding Twitter to X, changing its name and logo. Musk also overhauled the platform’s verification system. At the time, some experts voiced concerns, arguing that the Twitter brand was too well-known to change.