MicroStrategy Holds 226,500 Bitcoins in Q2 2024 Despite Revenue Drop

MicroStrategy, a prominent Bitcoin development company, has reported a significant expansion of its Bitcoin holdings in the second quarter of 2024. As of July 31, the firm holds 226,500 bitcoins, reflecting its continued strategic focus on cryptocurrency acquisition.

Key Highlights from Q2 Earnings Report

• Bitcoin Holdings: MicroStrategy acquired an additional 12,222 bitcoins during Q2, investing $805.2 million at an average price of $65,882 per bitcoin. The total investment in Bitcoin now stands at approximately $8.3 billion, with an average purchase price of $36,821 per bitcoin.
• Revenue Decline: The company’s revenue for the second quarter was $111.4 million, marking a 7.4% decrease compared to Q2 2023. Despite this, MicroStrategy reported growth in its software business, with subscription services revenues reaching $24.1 million, a 21% year-over-year increase.
• Stock Performance: MicroStrategy shares closed at $1,511.81, down 6% on Thursday.

Michael Saylor’s Continued Bitcoin Strategy

Executive Chairman Michael Saylor remains committed to an aggressive Bitcoin acquisition strategy. Saylor has stated he has no plans to sell any Bitcoin in the near future, underscoring the firm’s dedication to leveraging cryptocurrency as a critical component of its financial strategy.

In March, the company issued $800 million in 2.25% convertible senior notes due 2032, strategically managing its capital structure to finance Bitcoin purchases. This move has reinforced MicroStrategy’s position as one of the largest corporate holders of Bitcoin.

Performance Indicators and Financial Maneuvers

• BTC Yield: A key performance metric, the “BTC Yield,” was reported at 12.2% year-to-date, indicating that Bitcoin holdings have positively contributed to shareholder equity.
• Stock Split and Equity Offering: MicroStrategy announced a 10-for-1 forward stock split, effective August 7, aimed at increasing stock liquidity and accessibility. Additionally, the firm is preparing a new $2 billion at-the-market equity offering program to support its growth initiatives and ongoing Bitcoin acquisition strategy.

Chief Financial Officer Andrew Kang emphasized the importance of these financial strategies, highlighting the company’s use of “intelligent leverage” to enhance Bitcoin accretion for shareholders.

Outlook

Despite a challenging quarter in terms of revenue, MicroStrategy’s unwavering focus on Bitcoin investment and strategic financial maneuvers position the company for potential future growth. The upcoming stock split and equity offering are expected to further bolster the firm’s financial stability and support its ambitious cryptocurrency acquisition goals.