The company from Virginia purchased thousands of Bitcoins in the third quarter. MicroStrategy purchased 8,957 BTC, bringing its total BTC stash to a valuation of around $7 billion. As of October 29, it is the world’s largest publicly traded corporate owner of Bitcoin. It owns more than 114,000 BTC.
The company increased its Bitcoin holdings by 198% since the same period last year. At the end of September, it owned 114,042 BTC with an estimated average purchasing price of $27,713 per coin.
On paper, the software company posted a carrying value of $2.406 billion for its BTC holdings at an impairment loss of $754.7 million since the acquisition, nevertheless, this is a paper loss. As MicroStrategy categorizes BTC as an “intangible asset”, accounting rules mandate that the company must report an impairment loss when the carrying value falls below its cost basis. Nonetheless, MicroStrategy isn’t required to report any paper gains on the asset until a profit is realized through a sale.
Currently, the price of Bitcoin is roughly $60,000. So, the value of its holding equates to around $6.9 billion. MicroStrategy has the chance to earn billions of dollars by selling its BTC holdings.
The company from Virginia provides business intelligence software, mobile app, and cloud-based solutions. MicroStrategy pulls in revenue via streams such as product licensing and subscription services.
It reported $128 million worth of total revenue for the third quarter. The software company’s total revenue rose 0.5% compared to its Q3 results from 2020. The world’s largest publicly traded corporate owner of Bitcoin posted earnings of $1.86 per share. It topped consensus estimates three times over the last four quarters.
MicroStrategy’s CEO Michael Saylor mentioned a couple of interesting details in the report. He stated that “overall demand” for its platform and the growing adoption of MicroStrategy’s cloud-based solutions contributed to the company’s strong performance in the third quarter.
Saylor is a big fan of Bitcoin. Saylor retweeted his own post from 2020 and stated that “you do not sell your Bitcoin”.
For the third quarter, MicroStrategy posted a gross profit of $105.7 million. The company’s net loss for the quarter was $36.1 million, or $3.61 per share. In the third quarter of 2020, its net loss was $14.2 million or $1.48 per share.
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