Trump Media Criticized as ‘Scam’ by Barry Diller, Caution Urged
Debarylife – Trump Media is “a scam,” and investors in its soaring stock are “dopes,” according to IAC and Expedia Chairman Barry Diller, who delivered a harsh critique of the social media firm on Thursday. Former President Donald Trump is the company’s primary stakeholder.
“I mean, it’s ridiculous,” Diller said to a question regarding Trump Media on CNBC’s “Squawk Box” program. “The company has no revenue.”
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– When asked about the social media firm founded by Donald Trump, IAC Chairman Barry Diller claimed on CNBC that Trump Media is “a scam” and that those purchasing its skyrocketing shares are “dopes.”
– “They’re buying it for other reasons, just like they bought theaters when there was no theater business or bought GameStop,” Diller stated.
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– Trump owns a majority stake in Trump Media, the company that makes the Truth Social app, which he regularly uses.
– After Trump Media merged with a shell business and its shares became public, the company’s stock shot up.
“It’s a scam, just like everything he’s ever been involved in is some sort of con,” Trump was quoted as saying.
In reaction to Diller’s remarks, a Trump Media spokesperson stated, “It is unsurprising to see die-hard Trump haters and leftwing flacks blow a gasket now that Truth Social has become a public company that, still today, refuses to suppress political expression that contradicts the narratives they want to enforce.”
A representative for Trump, the presumed Republican presidential nominee, has been contacted by CNBC for comment.
Trump Media’s share price shot up over 50% to about $80 when it started trading last week under the symbol DJT, but it eventually settled. The price of Trump Media shares as of Thursday morning was around $47.
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Considering that the company only made $4.1 million in revenue the previous year and that its main product is the Truth Social app, which has much fewer users than popular social networking networks, this gives it an astounding $6.4 billion market valuation.
On Monday, Trump Media revealed that its net losses for 2023 totaled $58 million. He likened the price surge of Trump Media to the 2021 “meme stock” mania, during which the share price of AMC Entertainment, a movie theater company, surged to over $700 and the price of GameStop jumped to about $500 per share.
Early on Thursday morning, GameStop shares were trading at less than $12 a share, while AMC shares were selling for just more than $3.
Diller responded, “I think they’re dopes,” when asked why investors were purchasing the company’s stock.
“I mean, who would invest in a business that just makes, like, $30k annually? Who would be able to value that?” Diller queried.
“They’re buying it for other reasons, just like they bought theaters when there was no theater business or bought GameStop, whatever.”
“That is foolish. Inane words,” he uttered.
When asked if Trump Media might grow beyond its current size, especially if Trump wins the presidency later this year, Diller said categorically, “No… no.”
“Look, he’s only interesting now because he’s out there entertaining the folks,” observed Diller. “I hope if he gets elected he just plays golf for four years.”