Business intelligence firm MicroStrategy’s third-quarter earnings for the year revealed a reduced net loss of $27.1 million for the quarter, and it continues to grow its bitcoin (BTC) holdings. despite the poor conditions of the cryptocurrency market.
The world’s largest publicly traded corporate bitcoin holder confirmed that it still holds 130,000 BTC at the end of Q3 2022. That amount represents 0.62% of all the world’s bitcoin, which he says was acquired for a total cost of around $4 billion, or $30,639 per BTC.
The company reported on November 1 that impairment charges for the quarter were $727,000, much less than the $917.8 million it recorded in the second quarter of 2022. or the USD 65 million of the same period last year, thanks to the stability of bitcoin prices during the last quarter.
An impairment charge is an accounting term used by businesses to describe a reduction in the value of assets held, and according to MicroStrategy, it had cumulative impairment losses of approximately $2 billion as of September 30.
On a results call, MicroStrategy President and CEO Phong Le reiterated the company’s long-term sell-off strategy:
“We have not sold any bitcoin to date. To reiterate our strategy, we seek to acquire and hold bitcoin for the long term. And we currently have no plans to make bitcoin sales. We have a long-term time horizon and the core business is not affected by short-term bitcoin price fluctuations.”
Michael Saylorwho stepped down as CEO on August 8 but remains with the company as executive chairman, He mentioned on the call that since embarking on his bitcoin strategy on August 11, 2020, the company’s share price has risen 116% compared to bitcoin’s 72% rise over the same period.
In the attached results report, CFO Andrew Yang gave a nod to the recent announcement by the US Financial Accounting Standards Board to support “fair value accounting” for bitcoin, pointing out:
“If ultimately adopted and implemented, we believe fair value accounting will improve upon the current unfavorable intangible accounting treatment applicable to bitcoin holding companies and promote further institutional adoption of bitcoin as an asset class.”
MicroStrategy posted an adjusted loss per share of $0.96, versus analyst estimates for a loss of $0.94, and revenue of $125.4 million beat estimates by just 0.05%.
The company’s revenues in the last year have been USD 119.3 and 122.1 million, respectively, in the first and second quarters. $16.4 million of its third quarter revenue came from its subscription serviceswhich represents a 51% increase compared to the previous year in what is the fastest growing source of revenue for MicroStrategy.
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