MicroStrategy Q1 net loss hits $53.1 million, but Bitcoin buying continues

adminApril 30, 2024

MicroStrategy, the largest corporate holder of Bitcoin (BTC), reported a net loss of $53.1 million in the first quarter of 2024, while the company continued to accumulate more Bitcoin in April.

The net loss came as the company recorded digital asset impairment losses of $191.6 million in the quarter, a tenfold increase from the year-earlier period. MicroStrategy’s first quarter results filing showed that revenue also fell 5.5% compared to the first quarter of 2023, reaching $115.2 million.

However, the company has not yet adopted a new digital asset fair value accounting standard that takes into account a 65% increase in the fair value (or market value) of Bitcoin during the quarter.

As a result, MicroStrategy’s Bitcoin book value was recorded at $5.07 million, or $23,680 per Bitcoin, under traditional accounting methods, rather than $15.2 billion if the fair value approach was taken.

This despite the fact that the company sent a letter to the Financial Accounting Standards Board (FASB) in May 2023 in support of the new standard. About seven months later, the FASB issued a rule mandating fair value reporting of digital assets in fiscal years after December. Revised. 15/15/2024.

Meanwhile, the software company that morphed into a “Bitcoin development company” already purchased an additional 122 bitcoins in April for $7.8 million, its financial statements show.

The company currently holds 214,400 Bitcoin worth $13.5 billion, purchased at an average purchase price of $35,180.

MicroStrategy President and CEO Phong Le said the company raised $1.5 billion in two convertible bond offerings to acquire an additional 25,250 Bitcoins in the first quarter, marking the 14th consecutive quarter of adding Bitcoin to the company’s balance sheet. It was stated that it was done.

Related: MicroStrategy sells an additional $604 million of notes to buy 9K Bitcoin.

MicroStrategy (MSTR) stock fell 3.3% in after-hours trading following the announcement, according to Google Finance.

Bitcoin’s 65% rise sparked an almost unprecedented MicroStrategy rally in the first quarter, sending it surging more than 170% by the end of March to $1704.

However, MicroStrategy’s stock price has since fallen to $1,292, according to Google Finance.