MicroStrategy raises holdings to 226,500 bitcoin, introduces BTC yield metric
Quick Take
- As of July 31, MicroStrategy’s 226,500 total bitcoin holdings cost $8.3 billion, or $36,821 per bitcoin.
- MicroStrategy reported quarterly losses of $5.74 per share on sales of $111.40 million, a 7% year-over-year decrease.
MicroStrategy said Thursday that since the beginning of the second quarter, it had acquired 12,222 bitcoin for $805.2 million and introduced a new key performance indicator for its bitcoin strategy.
Its total bitcoin holdings, 226,500 BTC, came at a cost of $8.3 billion, or $36,821 per bitcoin, as of July 31.
The company said its "BTC yield" stands at 12.2% in the year-to-date period, and it will target 4% to 8% annually over each of 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.
"The Company uses BTC Yield as a KPI to help assess the performance of its strategy of acquiring bitcoin in a manner the Company believes is accretive to shareholders," the release said. "The Company believes this KPI can be used to supplement an investor’s understanding of its decision to fund the purchase of bitcoin by issuing additional shares of its common stock or instruments convertible to common stock."
The company said the BTC yield KPI is not an operating performance measure, a financial or liquidity measure, or equivalent to “yield” in the traditional financial context.
"On the adoption front, we are extremely optimistic with the improved understanding of bitcoin and the increasing support for the ecosystem from bipartisan politicians and institutions on display at the Bitcoin 2024 Conference in Nashville," CEO Phong Le said in a press release. "We also continue to see increased global adoption of our cloud-powered BI and AI software, achieving another quarter of strong double-digit growth in both subscription revenue and subscription billings."
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.
MicroStrategy's previously announced 10-for-1 stock split will go effective Aug. 7. The business intelligence company also said it will file a registration statement for a new $2 billion at-the-market equity offering program.
MicroStrategy's stock closed Thursday's trading session down 6% at $1,511.81 a share. The stock is up 120% year to date.
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