Key Takeaways
- MicroStrategy significantly increases its Bitcoin holdings to 226,500 BTC, by acquiring 12,222 bitcoin for $805.2M.
- The company introduces a new Bitcoin yield metric, aiming to provide better insights into the performance of its BTC assets.
- Despite a strong investment in bitcoin, MicroStrategy reports a substantial quarterly loss, while its operating expenses rise dramatically due to digital asset impairments.
MicroStrategy's Bitcoin Acquisition Strategy
MicroStrategy said on Thursday that since the beginning of the second quarter, it had acquired 12,222 bitcoin for $805.2M. The company's total bitcoin holdings now amount to 226,500 BTC, with an aggregate cost of $8.3B, averaging $36,821 per bitcoin as of July 31. MicroStrategy's ongoing strategy is focused on acquiring bitcoin in a manner believed to be beneficial to shareholders.
Introduction of BTC Yield as a KPI
The company also introduced a new key performance indicator called 'BTC yield', which currently stands at 12.2% for the year-to-date period. This KPI targets an annual yield of 4% to 8% over the next three years. BTC yield is the percentage change over time in the ratio of MicroStrategy's bitcoin holdings to its diluted shares outstanding. Diluted shares outstanding include all actual shares of the company's common stock plus any additional shares that could be created from converting all convertible notes, exercising all stock options, and settling all restricted and performance stock units. This measure shows how the company's bitcoin holdings compare to its total potential shares.
Quarterly losses report
MicroStrategy reported quarterly losses of $5.74 per share on sales of $111.40 million, a 7% year-over-year decrease. These substantially missed estimates that called for a quarterly loss of 78 cents a share and revenue of $119.3 million, according to analysts surveyed by Bloomberg. Operating expenses were $280.8 million, a 134% increase compared to the year-ago period. Operating expenses include impairment losses on the company’s digital assets, which were $180.1 million, compared to $24.1 million in the second quarter of 2023.
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