MicroStrategy's Bitcoin Investment Yields $900M Amid Anticipation of ETF Approval
Summary:
MicroStrategy has registered a $900 million return on its investment in 158,400 Bitcoin, driven by the prospect of approval for Bitcoin exchange-traded funds. The company added 6,067 BTC to its holdings in Q3 and remains committed to its Bitcoin strategy, despite recording a net loss of $143.4 million in the same period. The firm also leveraged the Bitcoin price fall in Q3 to acquire BTC at a lower cost. With its software licenses and subscription services seeing year-over-year growth, MicroStrategy's stock price has seen a 2.7% rise in after-hours trading.
Under the stewardship of founder Michael Saylor, MicroStrategy has witnessed a $900 million boost in its investment in 158,400 Bitcoin holdings, thanks to heightened anticipation surrounding the potential endorsement of Bitcoin exchange-traded funds. The firm has augmented its Bitcoin (BTC) portfolio with the procurement of an additional 6,067 BTC in the third quarter, including a purchase of 155 BTC in October, the details of which are outlined in MicroStrategy's November 1 report.
MicroStrategy's Bitcoin conference call was scheduled to take place at 5pm ET to review the Q3 2023 financial outcomes and address questions concerning future prospects in the realm of Business Intelligence and Bitcoin.
With unwavering resolve, the company is doggedly sticking to its BTC strategy, as stated by CEO Phong Le. Amid a milieu of potential upsurge in institutional acceptance, the company remains steadfast in its goal to consistently acquire and retain Bitcoin. The quarterly revenue rose marginally by 3%, amounting to $129.5 million, however this was not sufficient to propel the firm into profit, who reported a net depreciation of $143.4 million. Digital asset impairment charges and taxes constituted $33.6 million and $109.6 million respectively of overall net losses, as reported by the firm.
Despite the recent rise in Bitcoin prices, BTC experienced a 11.5% fall during Q3, dropping from $30,480 to $26,970. This downtrend was effectively harnessed by MicroStrategy, enabling them to procure the aforementioned 6,067 BTC at an average price of $27,590. The company has expressed confidence in their AI-empowered business analytic solutions, demonstrating a YoY growth of 16% and 28% in the software licenses and subscription services sectors respectively.
Microstrategy's Q3 earnings disclosure revealed the company's current Bitcoin portfolio at a cost basis of $29,586, yielding a $900 million profit and a 3% YoY increase in annual revenue at $129.5 million. Their Bitcoin acquisition and holding strategy is credited for generating profits equivalent to seven years of their annual revenue.
As per Google Finance, the post-trading hours saw a 2.7% appreciation in MicroStrategy's share price (MSTR), escalating it to $438.
Published At
11/2/2023 12:16:21 AM
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