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Highlights:
Trump Media's Truth Social struggles with low user engagement and lacks transparency in growth metrics, making it difficult to assess its long-term viability.
Rumble's user base and engagement have declined, but it continues to disclose growth metrics and is positioned to benefit from events like the U.S. elections and legal challenges against Google.
Despite challenges, Rumble's revenue growth and business model offer clearer financial visibility compared to Trump Media's uncertain future.
Trump Media & Technology Group (NASDAQ:DJT) and Rumble (NASDAQ:RUM) operate alternative social media platforms that aim to provide users with options outside of mainstream tech companies like Alphabet and Meta Platforms. Trump Media owns Truth Social, a platform launched in 2022, while Rumble promotes itself as an alternative to YouTube for streaming video content.
Both platforms assert political neutrality and claim not to censor user content, though they are primarily frequented by conservative users who believe major tech companies disproportionately censor right-leaning content. Both Trump Media and Rumble went public via mergers with special purpose acquisition companies (SPACs), but their stock performances have been far from stellar.
Trump Media's stock, which opened at a significant price after its merger in March 2024, now trades at a substantially lower value. The company’s Truth Social platform faces difficulties in growing its user base and has not disclosed key metrics like monthly active users (MAUs) or revenue per user. External estimates indicate that Truth Social's user base has significantly decreased, with active users declining from 124,852 to just over 76,000 in a few months. In addition, the company's financial performance in 2024 has been poor, posting substantial losses despite raising capital through stock offerings. The stock’s high valuation relative to its revenue and user metrics raises concerns about its long-term sustainability.
Rumble, by contrast, has a clearer business model and discloses traditional growth metrics like MAUs and average watch time. Though its user base and engagement have recently declined, Rumble continues to generate revenue, with a significant 106% increase in 2023. However, the company still faces challenges, including rising losses and a decline in revenue in 2024. Despite this, Rumble's ongoing lawsuits against Google, its potential to benefit from U.S. election-driven growth, and its cloud platform hosting Truth Social provide avenues for recovery and long-term growth.
While both companies face hurdles, Rumble’s more transparent metrics and diversified revenue streams position it better for potential recovery and sustained growth compared to Trump Media's uncertain trajectory.
