Trump Media just got a $105 million cash infusion as it expects to keep losing money

Former president Donald Trump.

Former president Donald Trump.

The company behind Donald Trump’s Truth Social just raked in a solid chunk of change.

Trump Media & Technology Group on Tuesday said it took in more than $105 million through the cash exercise of warrants between June 20 and Monday, July 1. The company had previously said it expected to raise just $69.4 million from the warrants. If all the warrants covered by its registration statement are exercised for cash, Trump Media could eventually receive as much as $247 million.

In an April regulatory filing, Trump Media said it was registering the resale of up to almost 21.5 million new shares of common stock issuable upon the exercise of warrants, up to about 146 million shares of common stock, and up to about 4 million warrants to purchase common stock.

Trump Media also revealed in April that it “lacks the financial resources it needs to sustain operations for a reasonable period of time,” raising “substantial doubt” as to its ability to continue operations. The company also expects to continue suffering operating losses and negative cash flow “for the foreseeable future.” In June, Trump Media confirmed it lost $58 million in 2023, according to regulatory filings.

In addition to the $105 million raised through the warrants, Trump Media said some $41 million of previously restricted cash has recently become unlocked. That brings the company’s total cash on hand to $350 million as of Monday, up from $233 million on hand in May.

The exercise of warrants and registration of additional shares are popular ways for public companies to receive a cash infusion, but these actions also dilute stockholders by increasing the number of shares freely tradable. The former president is a majority shareholder of Trump Media, holding almost 65% of outstanding common stock in the company as of June 10.

Although Trump Media & Technology Group stock spiked Friday after Trump came off strong in a debate with Democratic rival and incumbent President Joe Biden, the stock has since shed those gains. Trump Media stock was down more than 1% in Tuesday morning trading.

The company on Monday announced it had been added to the Russell 3000 and Russell 1000 indexes as part of annual adjustments after trading closed last Friday.

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