Microstrategy

MicroStrategy Acquires 122 More BTC, Now Holds 214,400 Bitcoins

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Key Insights: 

  • MicroStrategy now controls 214,400 Bitcoins, purchasing an additional 122 for $7.8 million as of April 2024.
  • Q1 2024 saw MicroStrategy achieve a gross profit of $85.2 million, marking a 74.0% gross margin despite revenue decline.
  • Despite operational losses, MicroStrategy continues its aggressive Bitcoin acquisition, reflecting confidence in its digital asset strategy.

MicroStrategy, a major player in the business intelligence sector, has recently bolstered its Bitcoin holdings by purchasing an additional 122 BTC for $7.8 million. This latest acquisition brings the firm’s total Bitcoin inventory to a staggering 214,400 units. As of April 26, 2024, these assets are valued at $7.54 billion, reflecting a price of $35,180 per Bitcoin.

During the first quarter of 2024, which ended on March 31, the company continued its aggressive investment strategy in the cryptocurrency, purchasing 25,250 Bitcoins for $1.65 billion. This translates to an average purchase price of $65,232 per unit. 

Phong Le, the President and CEO of MicroStrategy reaffirmed the company’s commitment to Bitcoin, highlighting its role in financial markets, advocacy, and technological innovation. He stated,

“It is through our unique bitcoin strategy and solid track record as an operating company that we now hold 214,400 bitcoins at an average purchase price of $35,180 per bitcoin.”

MicroStrategy’s financial performance in the first quarter also drew attention. The company reported a gross profit of $85.2 million, which represents a gross margin of 74.0%. However, this figure shows a decrease compared to the $94.0 million gross profit with a 77.1% margin reported in the same quarter the previous year.

Additionally, total revenues for Q1 2024 were $115.2 million, a 5.5% decline from the previous year’s first quarter. Revenues from product licenses and subscription services amounted to $35.9 million, while product support revenues reached $62.7 million, reflecting declines of 0.9% and 4.3%, respectively.

Moreover, the company’s financial health showed signs of strain as it reported a substantial net loss of $53.1 million for the quarter, equating to $3.09 per share on a diluted basis. This loss is significantly larger than the $20.3 million reported in Q1 2023. The operating loss for the quarter was also notably high at $203.7 million.

Phong Le highlighted the company’s strategic achievements in the quarter, including raising over $1.5 billion through two successful convertible debt offerings. This financial maneuvering facilitated the acquisition of additional Bitcoins and marked the 14th consecutive quarter of Bitcoin additions to their balance sheet. 

Andrew Kang, the Chief Financial Officer, noted that the recent regulatory approvals and institutional interest have positively impacted Bitcoin’s price, fostering a favorable environment for their Bitcoin-centric strategy.

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