MicroStrategy Reports $102.6 Million Q2 Net Loss, Expands Bitcoin Holdings Amid Market Volatility

MicroStrategy, an American software firm known for its substantial investments in Bitcoin, reported a net loss of $102.6 million for the second quarter of 2024. The company, co-founded by Bitcoin advocate Michael Saylor, recorded total revenues of $111.4 million. This marks a significant increase in losses compared to the $26.7 million loss reported in the same period last year.

The firm’s subscription services business saw a notable revenue increase of 21% year-over-year, reaching $24.1 million. Despite the overall financial challenges, MicroStrategy continued its aggressive Bitcoin acquisition strategy. In July alone, the company purchased an additional 169 BTC for $11.4 million, bringing its total holdings to 226,500 BTC, valued at approximately $14.7 billion. The average purchase price per Bitcoin was reported at $36,821.

Since the beginning of the second quarter, MicroStrategy has acquired 12,222 Bitcoins, amounting to $805.2 million. The company introduced a new Key Performance Indicator (KPI) called "BTC Yield," targeting a return of 4-8% annually over the next three years, highlighting their commitment to leveraging Bitcoin as a core asset.

Optimism and Strategic Moves

MicroStrategy's President and CEO, Phong Le, expressed optimism about the future, citing positive developments in Bitcoin understanding and support from politicians and institutions, notably observed at the Bitcoin 2024 conference in Nashville.

In the second quarter, MicroStrategy raised $800 million through the issuance of 2.25% convertible notes due in 2032 and redeemed $650 million notes due in 2025. CFO Andrew Kang emphasized the company's strategy of using "intelligent leverage," achieving a year-to-date "BTC Yield" of 12.2%, which they believe adds significant value to shareholders.

Stock Performance and Market Reaction

MicroStrategy's stock price closed at $1,511 on Thursday, with after-hours trading pushing it up to $1,570, reflecting a 3.85% increase according to Yahoo! Finance. The company's financial performance and continued investment in Bitcoin demonstrate a firm commitment to its digital asset strategy despite market volatility and a challenging economic environment.