Shares in Trump Media slump after former president convicted in hush money trial
Business
Shares in Trump Media slump after former president convicted in hush money trial
NEW YORK (AP) Shares of Trump Media & Technology Group, the owner of social networking site Truth Social, slumped before the opening bell Friday after former President Donald Trump was convicted in his hush money trial.
A New York jury found Trump guilty of falsifying business records in a scheme to illegally influence the 2016 election through hush money payments to a porn actor who said the two had sex.
Donald Trump’s conviction on 34 felony counts marks the end of his historic hush money trial. But the fight is far from over. Here’s what to know.
Will this impact the election? It’s unclear whether Trump’s once-imaginable status as a person convicted of a felony will have any impact at all on voters.
Shares fell 9% immediately Thursday in after-hours trading as news of the verdict emerged, and were down 5% early Friday.
The stock, which trades under the ticker symbol “DJT,” has been extraordinarily volatile since its debut in late March, joining the group of meme stocks that are prone to ricochet from highs to lows as small-pocketed investors attempt to catch an upward momentum swing at the right time.
The stock has tripled this year, in the process frequently making double-digit percentage moves either higher or lower on a single day. It peaked at nearly $80 in intraday trading on March 26. For context, the S&P 500 is up almost 10% year to date.
Meme stocks, including AMC Entertainment, and GameStop fell as well early Friday, as did shares of social media companies, but the decline for Trump Media was at least double the decline for any stock in either sector before the opening bell.
Earlier this month, Trump Media reported that it lost more than $300 million last quarter, according to its first earnings report as a publicly traded company.
For the three-month period that ended March 31, the company posted a loss of $327.6 million, which it said included $311 million in non-cash expenses related to its merger with a company called Digital World Acquisition Corp. DWAC was an example of what’s known as a special purpose acquisition company, or SPAC, which can give young companies quicker and easier routes to getting their shares trading publicly, but with much less scrutiny.
Shares of Trump Media & Technology Group, the owner of social networking site Truth Social, have slumped after former President Donald Trump was convicted in his hush money trial. More from AP’s Lisa Dwyer.
Trump Media & Technology fired an auditor this month that federal regulators recently charged with “massive fraud.” The media company dismissed BF Borgers as its independent public accounting firm on May 3, delaying the filing of its quarterly earnings report.
Trump Media had previously cycled through at least two other auditors — one that resigned in July 2023, and another that was terminated by its board in March, just as it was rehiring BF Borgers.
Trump was charged with 34 counts of falsifying business records at his company in connection with an alleged scheme to hide potentially embarrassing stories about him during his 2016 Republican presidential election campaign.
The charge, a felony, arose from reimbursements paid to then-Trump lawyer Michael Cohen after he made a $130,000 hush money payment to porn actor Stormy Daniels to silence her claims of an extramarital sexual encounter with Trump in 2006. Trump was accused of misrepresenting Cohen’s reimbursements as legal expenses to hide that they were tied to a hush money payment.
Trump’s defense contended that the Cohen payments were for legitimate legal services.
