Trump Media & Technology, the parent company of Truth Social, reported a staggering $238 million loss for the second quarter and announced a strategic retreat from its recent diversification push, pivoting instead to a subscription-based data service aimed at high-speed Wall Street traders.
The company, majority owned by President Donald Trump, said Monday that its net loss for the three months ending in June was more than ten times the $22 million loss recorded a year earlier. On a per-share basis, the deficit widened to 86 cents from 8 cents. The bulk of the red ink came from mark-to-market declines in its holdings of bitcoin and a crypto token called Cronos, which the company had touted as part of its growth plan.
Newly installed chief executive Kevin McGurn, who took over in the wake of the company's failed expansion into online betting and other ventures, said the firm would now "say no to things or change course as warranted." In a conference call with analysts, McGurn described the pullback as a "disciplined choice" to concentrate resources on its core social media mission and a new product called Truth API.
Truth API provides financial firms with early access to posts from top Truth Social users—most notably President Trump, whose announcements on the platform frequently move markets. McGurn said the service is already generating between $60,000 and $100,000 per month per client and has signed up ten customers, mostly high-frequency trading firms. That could translate into an additional $7 million to $12 million in annual revenue, roughly two to three times the company's total revenue last year.
The pivot has drawn sharp criticism from good-government watchdogs and Democratic lawmakers, who argue it is a vehicle for the president to profit from his office. They have vowed to investigate the paid data feed if Democrats reclaim Congress in the midterms. McGurn dismissed the concerns, noting that selling real-time public data through commercial APIs is "a well-established business practice across the technology, financial information and media industries."
Not all expansion plans are being scrapped. McGurn said the company still intends to close a previously announced merger with energy firm TAE Technologies, which is developing nuclear fusion technology. He called that deal "the single most important driver of long-term value for this company."
Excluding the paper losses on digital assets, operating losses still widened to $164 million from $44 million a year earlier, underscoring the underlying costs of the company's operations. Revenue for the quarter was $1.7 million, more than double the $700,000 reported a year ago.
Trump Media's balance sheet remains a point of concern. The company holds $1 billion in special convertible notes that mature in 2028, but lenders have the option to demand repayment this November. At the end of June, the company had more than $400 million in cash and short-term investments, along with $1.2 billion in bitcoin and related assets, providing some cushion.
Shares fell another 8% in regular trading on Monday and dipped slightly in after-hours action following the earnings release. The stock has been volatile since the company went public via a SPAC merger in 2024.
McGurn expressed confidence in the new direction, calling it "the early innings" and suggesting the potential market for Truth API extends beyond traders to data center operators, news organizations, and developers of large language models. Whether the service can offset the company's losses and satisfy regulators remains an open question.
