Software analytics firm MicroStrategy posted a paper loss of more than $1 billion on its Bitcoin (BTC) holdings in 2022, but says it has no plans to stop buying the digital asset.
MicroStrategy released its 2022 fourth-quarter and year-end results on Feb. 2, showing that the impairment charges recorded on its BTC holdings, net of sale gains, were nearly $1.3 billion for the full year.
Despite the paper losses, in a February 2 earnings call, MicroStrategy CFO Andrew Kang said:
“We may consider seeking additional transactions that may take advantage of Bitcoin price volatility, or other market dislocations that are consistent with our long-term Bitcoin strategy.”
In the call, MicroStrategy co-founder Michael Saylor He said that the company measures the performance of its shares against “a number of different benchmarks” saying that “the most important benchmark is the performance of Bitcoin.”
Saylor added that since MicroStrategy first announced which was buying Bitcoin in August 2020 its “has been able to outperform Bitcoin as an index” during that time.
He said that the company’s shares are up 117% since August 2020 compared to Bitcoin’s gain of 98%, adding:
“The only real safe haven for an institutional investor is Bitcoin. Bitcoin is the only universally recognized digital commodity, so if you are an investor, Bitcoin is your safe haven in this regard.”
Kang stated that MicroStrategy held a total of 132,500 bitcoins worth $1.84 billion as of December 31, 2022. 14,890 bitcoins were held directly by the company and the remainder by its subsidiary MacroStrategy LLC.
At the end of last year, the company sold for the first time a part of your Bitcoin holdings. Discussing the sale, Kang said that the 704 bitcoins were sold to collect a tax loss of about $34 million.
He added that even with the sale, the company “increased our net holdings by 2,500 bitcoins during the quarter.”
MicroStrategy’s global revenue for the fourth quarter was $132.6 billion, exceeding Wall Street expectations. Its loss per share in the fourth quarter was $21.93.
At the time of writing, MicroStrategy’s share price had fallen more than 4% in after-hours trading, according to data from Yahoo Finance.
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