- MicroStrategy reports a net loss of $53.1 million in Q1 2024, largely due to a $191.6 million digital asset impairment loss.
- Despite the loss, the company continues its trend of accumulating Bitcoin, adding another 122 Bitcoin in April.
- MicroStrategy’s Bitcoin holdings now stand at 214,400 BTC, worth $13.5 billion, acquired at an average price of $35,180 per Bitcoin.
- The firm raised $1.5 billion from convertible note debt offerings in Q1 to fund further Bitcoin acquisitions.
- MicroStrategy has yet to adopt the new digital asset fair value accounting standard, despite advocating for it in a letter to the Financial Accounting Standards Board (FASB).
MicroStrategy’s Financial Performance Amid Bitcoin Accumulation
MicroStrategy, known as the largest corporate holder of Bitcoin (BTC), faced a net loss of $53.1 million in the first quarter of 2024, primarily attributed to a substantial digital asset impairment loss totaling $191.6 million. Despite this setback, the company continued its ambitious Bitcoin buying spree, bolstering its holdings with an additional 122 Bitcoin purchased for $7.8 million in April alone.
Bitcoin Accumulation Continues Unabated
Despite the financial loss, MicroStrategy remains committed to accumulating Bitcoin, with its holdings now totaling 214,400 BTC, valued at an impressive $13.5 billion. This strategic accumulation has been ongoing, with the firm acquiring Bitcoin at an average purchase price of $35,180, a testament to its long-term investment strategy.
Financial Strategy and Future Outlook
MicroStrategy’s aggressive approach to Bitcoin accumulation is facilitated by its financial maneuvers. In the first quarter of 2024, the company raised $1.5 billion through convertible note debt offerings, specifically earmarked for further Bitcoin acquisitions. This marks the 14th consecutive quarter in which MicroStrategy has expanded its Bitcoin holdings, demonstrating its unwavering commitment to the cryptocurrency despite periodic financial losses.
Delayed Adoption of Fair Value Accounting Standard
Notably, MicroStrategy has yet to adopt the new digital asset fair value accounting standard, despite advocating for its implementation in a letter to the Financial Accounting Standards Board (FASB) in May 2023. The standard mandates fair value reporting of digital assets for fiscal years after December 15, 2024. However, MicroStrategy’s adherence to traditional accounting methods means its carrying value of Bitcoin remains significantly lower than its market value.