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Barry Diller says Trump Media is 'a scam' and people buying shares are 'dopes'

Barry Diller
Barry Diller, the chairman of IAC, had some harsh words for Trump Media and its shareholders.Mike Blake/REUTERS
  • Barry Diller says shareholders of Truth Social's owner have been scammed.

  • The IAC chairman pointed to Trump Media's low revenue and said he doubted Truth Social would grow.

  • Shares for Trump Media & Technology Group initially surged after going public but have since tumbled.

Barry Diller has a message for Trump Media shareholders: "I think they're dopes."

Trump Media & Technology Group, the owner of the Truth Social app, enjoyed a soaring debut when it went public last week, attracting the interest of retail investors and the "meme stock" crowd.

But that moment in the sun was short-lived, and shares of the former president's social-media platform have since come crashing down to earth.

Diller, a media mogul who's the chairman of IAC and Expedia Group, didn't sound very optimistic about the stock's future when asked about it during a recent interview — and doesn't get why people were so excited about it in the first place.

"Why are you even talking about this? It's a scam," Diller said in an interview on CNBC's Squawk Box on Thursday.

TMTG's total revenue in 2023 was just $4.1 million, according to a Securities and Exchange Commission filing on Monday — while it lost $58 million. Those numbers, Diller suggested, shouldn't indicate "buy" to any reasonable investor.

"It's ridiculous," he said. "The company has no revenue."

Questioning how anyone could see Trump Media as a valuable company, Diller concluded that its shareholders mustn't have financial soundness in mind when purchasing the stock. "They're buying it for other reasons," he said, calling them "dopes."

Diller likened the surge in Truth Social's owner to the frenzy around GameStop and other "meme stocks."

Diller said the platform offered little opportunity for future growth.

"Why would it be bigger?" he asked, adding that Donald Trump — a major part of the platform's appeal — was "only interesting now" because he was "out there entertaining the folks" on the campaign trail.

TMTG didn't return a request for comment before publication.

Truth Social's barnstorming debut briefly inflated Trump's net worth to an estimated $7.8 billion, making him richer than George Soros. But just a few days later, that number had tumbled to $6.4 billion, according to the Bloomberg Billionaires Index on Friday.

The New York Times reported that short-sellers were meanwhile already betting millions against the company, citing data from S3 Partners.

Trump could also find it difficult to materially benefit from Trump Media in the short-term, since he's prevented from selling his shares for another six months as part of a "lock up" period — unless the company's board allows otherwise.

Read the original article on Business Insider