MicroStrategy Stock Rises Over 4% Despite Q2 Net Loss, Bitcoin Holdings Reach 226,500 BTC

MicroStrategy Boosts Bitcoin Holdings Despite Quarterly Loss

MicroStrategy’s strategic investment in Bitcoin continues to pay off as the company reported owning 226,500 BTC by the end of July, purchased for $8.3 billion at an average price of $36,821 per Bitcoin. Despite posting a net loss of $123 million for the second quarter, an improvement from the $137 million loss in the previous quarter, the company’s stock surged over 4% in after-hours trading.

Financial Performance and Bitcoin Strategy

The company’s second-quarter performance showed a narrowed loss, driven by lower impairment losses and a strategic increase in Bitcoin holdings. The adjusted loss per share for the quarter was $7.62, slightly better than the previous quarter’s loss of $8.26 per share. Comparatively, the firm reported an EPS of $2.35 in the same quarter of 2023. Revenue for the second quarter was $111.4 million, falling short of the consensus estimate of $122 million and down from $115.2 million in the previous quarter.

Expansion of Bitcoin Portfolio

MicroStrategy continued its aggressive Bitcoin acquisition strategy during the second quarter, adding 12,222 BTC at an average price of $65,882 each. In July, the company further increased its holdings by acquiring an additional 169 BTC for $11.4 million. The company’s total Bitcoin holdings now stand at 226,500 BTC, purchased for $8.3 billion at an average cost of $36,821 per Bitcoin.

Introduction of BTC Yield Metric

In an effort to better communicate its Bitcoin strategy, MicroStrategy introduced “BTC Yield” as a new key performance indicator. This metric measures the percentage change in the ratio of its Bitcoin holdings to its assumed diluted shares outstanding. The firm achieved a BTC Yield of 12.2% year-to-date, with an annual target yield of 4-8% from 2025-2027.

Capital Management and Future Outlook

MicroStrategy raised $800 million through a convertible senior notes offering and announced a 10-for-1 stock split effective August 7. Additionally, the company filed a registration statement for a new $2 billion at-the-market equity offering program, signalling its intention to continue managing its equity capital closely.

The second-quarter results highlight MicroStrategy’s efforts to balance its substantial Bitcoin holdings with the growth of its software business. The firm’s future performance will depend on navigating the volatility of the crypto market while advancing its business analytics services.

Also Read: MicroStrategy’s Bitcoin Investment Hits Jackpot: $4 Billion Profits Surpassed $10 Billion