Shares of Trump Media & Technology Group Corp (DJT) dropped 1.5% in morning trading after the company and TAE Technologies confirmed they will no longer pursue a previously discussed plan to carve out Truth Social and certain other media assets into a separate publicly traded vehicle.
In a joint statement, the two firms offered no explanation for abandoning the spinoff. They said only that their priority remains completing the all-stock merger they announced earlier, which they continue to expect will close in the fourth quarter of 2026 or sooner.
Background on the proposal
The spinoff under consideration had been the subject of discussions since February 2026. Under the concept that had been advanced, selected media assets owned by Trump Media would have been combined with Texas Ventures Acquisition III, a special purpose acquisition company listed on Nasdaq. The planned structure would have seen Truth Social shares distributed to existing Trump Media shareholders ahead of the closing of the TAE merger, creating a potential standalone social media vehicle.
With the spinoff route now closed, the combined company's board plans to assess strategic alternatives for the legacy media assets only after the TAE merger is completed.
Market reaction and context
Today's development compounds a difficult run for DJT shareholders. The stock has declined more than 38% so far in 2026. That slide has been driven by a first-quarter net loss of roughly $406 million on revenue of just $871,200, a management transition resulting in interim CEO Kevin McGurn taking the helm, and write-downs associated with the company's digital asset holdings.
Broader market dynamics offered little support. Both the S&P 500 and the Dow Jones Industrial Average were trading lower following a May consumer price index reading that showed U.S. inflation accelerating to 4.2% year-over-year - the highest rate since April 2023. The jump in inflation was driven in large part by a 23.5% annual rise in energy prices tied to the ongoing conflict in Iran, according to the data cited.
Against this backdrop, DJT traded near its 52-week low of $7.76. During the session the stock hit a low of $7.99 before recovering slightly to trade at $8.04, considerably below its 52-week high of $21.49.
What remains clear from the companies' announcement is limited: the spinoff is off the table and the firms remain committed to the all-stock merger timetable. Any further strategic moves for legacy media assets are deferred until after that merger closes.
The near-term picture for shareholders therefore hinges on the completion of the TAE transaction and decisions the combined board will make once that transaction is finalized.