MicroStrategy’s Bitcoin Bet Pays Off: Acquires 850 More Bitcoins Despite Stock Dip
Crypto News – MicroStrategy Inc (NASDAQ: MSTR) expanded its Bitcoin portfolio by acquiring an additional 850 Bitcoins for $37.2 million in January, a move that stands out amidst the company’s recent stock performance struggles. Despite a 21 percent decline in MicroStrategy’s stock value since the start of the year, trading around $490 as of Wednesday, the United States-based enterprise analytics and mobility software provider has continued to capitalize on its Bitcoin strategy spearheaded by CEO Michael Saylor three years ago. This strategy has positioned MicroStrategy as the largest accumulator of Bitcoins among publicly traded companies globally in recent years.
With a market valuation of approximately $8.2 billion and 14.75 million outstanding shares, MicroStrategy remains poised to capitalize on the confirmed macro bull market in the coming quarters. Additionally, the recent approval of spot Bitcoin exchange-traded funds (ETFs) in the United States has further bolstered the bullish outlook, especially with the impending halving event.
The company’s commitment to its Bitcoin strategy was evident in its financial results for the fourth quarter of 2023, released on Tuesday, which revealed that 37,755 Bitcoins were purchased during the period for approximately $1.25 billion. With the acquisition in January, MicroStrategy now holds a total of 190,000 Bitcoins purchased at a cost of $5.93 billion, potentially generating unrealised profits in excess of $2 billion from its Bitcoin holdings.
Despite a 6 percent decline in total revenue to $124.5 million during the fourth quarter compared to the previous year, largely attributed to decreases in product licenses, subscriptions, and support services revenue, MicroStrategy’s Bitcoin holdings have significantly bolstered its market outlook.
Andrew Kang, Chief Financial Officer of MicroStrategy, emphasized the company’s strategic approach to leverage capital markets activities and cash reserves to accumulate more Bitcoin, thereby enhancing shareholder value. Kang noted, “It is through our unique Bitcoin strategy and solid track record that we now hold 190,000 Bitcoins at an aggregate purchase price of $31,224.”
In addition to its Bitcoin-centric approach, MicroStrategy remains committed to exploring emerging technologies such as Artificial Intelligence (AI). The company is optimistic about future quarters, believing that its focus on these technologies will further benefit shareholders, despite the necessary dilution of portfolios to acquire additional Bitcoins.