[Business & Issue] Despite 540 Billion Won Share Buyback Announcement... Why 'Trump Media' Fails to Rebound

Stock price halved since the beginning of the year... Downward trend continues
Over 540 billion won in losses, yet 3 trillion won in investment funds raised
President Trump faces conflict of interest and stock manipulation allegations

Reuters Yonhap News

Trump Media (DJT), the social networking service (SNS) company owned by U.S. President Donald Trump, announced a large-scale share buyback worth over 540 billion won. However, the stock price, which has been cut in half since the beginning of the year, has shown little sign of recovery. Recently, DJT secured more than 3 trillion won in investment funds by announcing plans to invest in cryptocurrencies such as Bitcoin and Ethereum. Nevertheless, poor business performance, as well as risks related to conflicts of interest and stock price manipulation allegations surrounding President Trump, have emerged as major concerns. Experts have pointed out that even though there are high expectations for policy benefits under a Trump administration, DJT's corporate value is excessively high, so investors should exercise caution.

Stock price halved since the beginning of the year... Unmoved even after share buyback announcement

On June 26 (local time) at the U.S. Nasdaq market, DJT's stock price stood at $17.82, representing a 47.61% decline compared to the beginning of the year. Previously, on June 24, DJT announced a share buyback plan worth $400 million (about 543 billion won), but the stock price actually fell by 2.14%. At the time of the announcement, DJT emphasized, "With board approval, we plan to repurchase up to $400 million in common stock, and this decision is aimed at increasing shareholder value."

The main reason for DJT's weak stock price, despite the large-scale share buyback, is that the company has failed to deliver performance sufficient to support its $4.9 billion (about 6.648 trillion won) market capitalization. Last year, DJT's revenue was only $3.6 million (about 480 million won), and it recorded a net loss of $400 million. The market capitalization is 1,361 times larger than the revenue.

Steve Sosnick, chief strategist at brokerage Interactive Brokers, told CNN, "The company has very little revenue and is posting massive losses, so by traditional standards, this stock is extremely expensive," adding, "So far, this stock has always been considered to be excessively priced, far exceeding traditional valuation indicators."

Over 3 trillion won raised following Bitcoin purchase plan... Growing concerns

Reuters Yonhap News

Another source of concern for DJT is its investment strategy to hold all of its assets in cryptocurrency. On May 27, DJT announced an investment strategy to raise $2.5 billion (about 3.4 trillion won) in the market and focus on purchasing cryptocurrencies such as Bitcoin and Ethereum. DJT stated that 75% of the raised funds would be invested in Bitcoin, and the remaining 25% in Ethereum.

Subsequently, on June 6, DJT announced that it had secured $2.3 billion (about 3.1245 trillion won) in funds from 50 institutional investors through the issuance of convertible bonds and partial resale of shares. In addition, DJT's subsidiary, Truth Social, requested approval from the U.S. Securities and Exchange Commission (SEC) for exchange-traded fund (ETF) products linked to Bitcoin and Ethereum.

Although there are expectations for policy benefits under the Trump administration, it remains uncertain whether DJT can achieve significant success in the increasingly competitive U.S. cryptocurrency-linked ETF market. According to the SEC, there are as many as 70 cryptocurrency ETF products in the U.S. that have been submitted for regulatory review for launch this year.

Matthew Tuttle, CEO of U.S. asset management firm Tuttle Capital Management, told CNBC, "Just because it has the Trump name, people won't necessarily buy it, as dozens of companies have already entered the cryptocurrency market," adding, "Trump Media will ultimately only follow the same strategy as MicroStrategy, continuing to buy cryptocurrencies."

'Trump' becomes a double-edged sword... Conflict of interest and stock price manipulation allegations

Trump Junior, the eldest son of President Donald Trump, is giving a speech at a Bitcoin conference held in Las Vegas, USA, on May 27 (local time). Photo by AFP

The relationship with President Trump, which has so far been the main driver of the stock price, also carries the risk of turning into a liability. Allegations of conflicts of interest and stock price manipulation surrounding the relationship between DJT and President Trump have raised the possibility of future legal issues.

On April 9 (local time), at around 9 a.m., President Trump posted a message on Truth Social stating, "Now is a good time to buy, DJT," which drew criticism for stock price manipulation. A few hours after the post, the U.S. government announced a 90-day suspension of reciprocal tariffs on 75 countries, excluding China, resulting in the Nasdaq index closing up 12%, and DJT's stock price surging 21.66%.

Trump Junior, President Trump's eldest son who holds a 50.09% stake in DJT through a trust, reportedly earned $414.25 million (about 561.5 billion won) from the stock price surge that day. This stake originally belonged to President Trump before his election and was transferred to a trust managed by his son, Trump Junior, after he became president.

As criticism mounted that President Trump was using cryptocurrency for personal gain, the U.S. Democratic Party began pushing for legislation to block cryptocurrency investments by the Trump family, citing the need to prevent conflicts of interest. If the bill is enacted, it could lead to future legal issues. Last month, the U.S. Democratic Party introduced the "End Crypto Corruption Act of 2025." The bill would prohibit public officials, their spouses, and children from issuing or promoting cryptocurrencies and digital assets during their term of office and for one year after leaving office.