New York CNN  —  Former President Donald Trump hit the jackpot this spring when his social media company finally went public. Even though Trump Media & Technology Group (DJT) generates very little revenue, investors are assigning an eye-popping valuation north of $9 billion to the company. Trump’s dominant stake in Trump Media is now valued at nearly $6 billion. Yet new data shows its main product — the conservative-friendly social network Truth Social — remains a very tiny player in its industry, and it’s getting even smaller. Truth Social’s average number of daily active US users on iOS and Android dropped by 19% year over year in April to about 113,000, according to data shared exclusively with CNN from Similarweb, a data intelligence company. The Similarweb data, which captures the first 29 days of April, showed that the average number of users dipped 4% month over month. That drop comes despite the considerable attention received by the ongoing Trump criminal trial and the growing focus on the US presidential election. This is a problem for Truth Social and for Trump, who is not only the dominant shareholder in Trump Media but also serves as the chairman and is the platform’s most popular user. “User growth is foundational to any social media startup. It is how these companies make money: Grow users and monetize them, in that order,” said Matthew Kennedy, senior initial public offering strategist at Renaissance Capital, which provides pre-IPO research and IPO-focused exchange traded funds (ETFs). More users means more money the social media startup can charge on ads sold.And there is a snowball effect in which user growth can build upon itself as friends, neighbors and co-workers encourage each other to sign up. User growth is critical “Social media services are prime examples of network effects, the idea that as more people use a product, the more valuable it becomes,” said Kennedy. “If your entire social circle is on a social media platform, that’s a strong pull to sign up. If there is’t a lot of user content, people stick with existing alternatives.” Even Trump Media’s own filings warn investors that a failure to grow users would spell trouble. “Social media companies are speculative businesses because revenues and income derived from them depend primarily upon the continued acceptance of that platform,” Trump Media wrote in a filing earlier this year. “Failure to attract a sufficient user base would adversely affect TMTG’s business prospects.” Trump Media spokesperson Shannon Devine responded to a CNN inquiry by arguing Truth Social continues to grow and by criticizing the media. “In just a few years Truth Social has amassed millions of users and our user base is rapidly expanding every day, though it’s unsurprising to see the politicized media cherry pick some unreliable estimate to downplay our success,” Devine said. How other social platforms are doing It’s true that other social media platforms are also struggling to grow users and make money. Yet Truth Social’s decline exceeds that of most of its rivals. According to Similarweb, the average number of daily active US users on iOS and Android fell 11% year over year to 34.2 million at X, the Elon Musk-owned platform formerly known as Twitter. This metric was up slightly (0.4%) on a month-over-month basis. Threads, the Instagram app owned by Mark Zuckerberg’s Meta, grew its daily active US users by 5% month over month to 3.5 million. Reddit, which also went public earlier this year, experienced a 17% year-over-year jump in users and a 1% monthly gain to 31.4 million. At Rumble, the video-based social media platform popular with conservatives, the average number of daily active users fell 17% year over year and was little changed on a monthly basis, according to Similarweb. The good news for Truth Social is it didn’t lose users nearly as rapidly as Gettr. Similarweb said Gettr, a pro-Trump social media platform, has lost 72% of its average daily users on iOS and Android over the past year. ‘Hefty valuation’ for DJT Still, web traffic doesn’t look any better for Trump Media. The average number of daily unique US visitors to Truth Social’s website fell 12% year over year and 21% on a monthly basis, according to Similarweb. When Truth Social’s web and app audiences in the US are combined, they amount to less than 6% of the audience on Threads. And Truth Social represents less than 1% of X’s total audience. “Truth Social has a hefty valuation, considering how small it is compared with other social media players — and many of those bigger players have been challenged to run a profitable business,” said Tom Liu, vice president of data labs at Similarweb. One problem for Truth Social is that since Musk took over X, that platform has worked to gain a following from the same users Truth Social is fighting for those concerned about alleged censorship at traditional tech companies. “Convincing potential new users, especially users who oppose big tech censorship, of the value of Truth Social is critical to increasing TMTG’s user base and to the success of TMTG’s business,” Trump Media wrote in the filing. ‘Meme stock’ argument Trump recently received another 36 million shares of Trump Media as part of a bonus known as earnout shares. Including those new shares, Trump owns 114.75 million shares of Trump Media — a stake valued at $5.6 billion. The former president has agreed not to sell that stake for at least the next several months. And it’s very difficult to know what that stake will be worth once the so-called lockup period ends because Trump Media’s share price has been unusually volatile. After spiking above $66 a share on its second day as a public company, Trump Media (DJT) crashed to a post-merger low of $22.84 on April 16. It has since more than doubled in value, closing at $48.68 on Thursday. Including all warrants outstanding, that gives Trump Media a diluted market valuation of $9.4 billion, according to Kennedy. Of course, Kennedy notes that there is a counter argument that Trump Media is not a typical social media stock, and so traditional metrics like growth and revenue don’t really matter. “This is the ‘meme stock argument,” Kennedy said. “Stocks can be become untethered to their fundamentals for a time, but in the long-run the valuation and the fundamentals tend to converge.”