- Truth Social launched its web application today
- Its team hopes this will help the platform compete with Twitter NYSE:TWTR)
- Digital World Acquisition Corp (NASDAQ:DWAC) stock likely won’t be affected in the long term
Digital World Acquisition Corp (NASDAQ:DWAC) finally saw some growth last week after a turbulent month. Now the blank-check partner of the Trump Media & Technology Group (TMTG) has a new catalyst. Truth Social launched its web application today, making the platform accessible from web browsers. However, DWAC stock has not reacted to the news so far.
What’s Happening With DWAC Stock
Even a catalyst intended to widen its user base hasn’t helped Truth Social or DWAC stock today. As of this writing, shares are down almost 2.5% for the day and showing no signs of a rebound. Despite some slight attempts to rally, they remain firmly in the red. While DWAC rose steadily last week, it has failed to pull back into the green for the month due to considerable turbulence.
Let’s take a closer look at what this news means.
Why It Matters
After months of watching Truth Social struggle, former President Donald Trump finally began using it again. This certainly led to an increase in downloads of the app and has kept DWAC stock from falling too far. However, the stock’s recent turbulence raises some questions as to how far Trump can take Truth Social, and likewise, DWAC stock.
The former president has made it clear that he wants Truth Social to rival Twitter (NYSE:TWTR). When Elon Musk announced his plans to acquire the social media giant and revise its censorship policies, Trump responded by taking a renewed interest in his own platform. And while interest in Truth Social has certainly risen since then, it does not mean that its user base will ever be large enough to rival Twitter’s. According to data, it can only boast 2 million monthly active users while Twitter’s user base is an estimated 300 million.
Truth Social is significantly lagging in user count, and it’s impossible to ignore the fact that it operates in a highly niche market. While there is certainly enough interest in Trump’s content to keep the platform viable, it won’t outnumber the people who use Twitter. Even as the 2024 presidential election draws slowly near, it is unlikely that Truth Social will garner enough traction to pose any real competition to Twitter. And the recent performance of DWAC stock doesn’t suggest that investors are confident in the company’s future.
What It Means for DWAC Stock
It’s worth noting that Truth Social’s web application release was ahead of schedule. When TMTG rolled out Truth Social early, it resulted in many glitches and prompted investors to run the other way. Today’s web application rollout is in keeping with the company’s previous strategy in the sense that it doesn’t actually address the platform’s problems. Truth Social isn’t failing to overtake Twitter because it wasn’t previously accessible by browser. That happened because the social media giant has a much larger user base and significantly more widespread appeal.
Even with Trump using Truth Social, DWAC stock hasn’t demonstrated any sustainable growth. That’s because the company doesn’t have much further to go. If Elon Musk ends up acquiring Twitter, Truth Social will likely lose even more of its user base. Investors should look elsewhere for social media plays.
On the date of publication, Samuel O’Brient did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.