This is not investment advice. The author has no position in any of the stocks mentioned. Wccftech.com has a disclosure and ethics policy.
Trump Media and Technology Group (NASDAQ: DJT) is increasingly turning into a case where lofty ambitions clash with institutional inertia, dampening the overall pace of progress to the detriment of investors.
Trump Media and Technology Group reported its earnings for the first quarter of 2024 yesterday, constituting the first such milestone in its brief journey as a publicly traded entity. But while the announcement was heavy on symbolism, the contents were predictably underwhelming. As we noted in a dedicated post, Trump Media earned just $770,500 in revenue in Q1, which translated into an operating loss of $12.1 million for the quarter. As a rare bright spot, do note that this loss was inflated by around $6.3 million in "one-time payments related to the closing of TMTG’s merger with Digital World."
Trump Media and Technology Group noted in the accompanying press release that it has now "finished the research and development phase of its new live TV streaming platform and will begin scaling up its own content delivery network (CDN)." In the first phase, the company will introduce live streaming to the iOS, Android, and web versions of the Truth Social platform. In the second phase, Trump Media intends to launch a dedicated OTT streaming app for smartphones and tablets. In the third phase, the company will release a version of the app for smart TVs.
Despite this ambitious agenda, we find it quite strange that Trump Media and Technology Group incurred non-material software development costs during the just-concluded quarter, as per the firm's latest Form 10-Q.
Of course, the company incurred $33.158 million in R&D expenses. However, the accompanying notes clarify that this outlay was primarily related to employee salaries and benefits as well as allocated overhead costs.
Most insane thing about $DJT 10-Q
Not a single penny spent on capex
You didn't buy a computer or an office chair?
Growth biz?
Don't think I've ever seen this pic.twitter.com/Z1LOUiQyV8
— Jeff Davies, the Energy OG (@EnergyCredit1) May 21, 2024
In 2023, Trump Media and Technology Group had projected that it would earn $17.5 million in revenue in the entire FY 2024. It remains to be seen whether this goal will be realized.
Me either, apparently some unnamed entity agreed to be paid only $15 a month for this kind of stuff (who knows why anyone would do this) but according to this filing, that agreement expired last year and $DJT HAS NOT EVEN PAID the whopping $220 they owe them yet pic.twitter.com/9N6YskDcY2
— John Van Dammit (@DammitJean) May 21, 2024
As an interesting anecdote, consider the fact that Trump Media was supposed to pay $15 per month to an entity for services rendered. Yet, this minimal expense remains in arrear, to the tune of $221.
At the time of writing, Trump Media and Technology Group shares are down around 10 percent. The stock is still up 23 percent over the past month.
