MicroStrategy Stash Now Worth $7 Billion with Addition of 9,000 BTC Last Quarter

In Brief: 

• MicroStrategy added almost 9,000 Bitcoins to its stash in Q3.
• The software company has added 198% to its Bitcoin holdings.
• Gross profit for the quarter tallied at $105.7 million

In Q3, MicroStrategy added almost 9,000 Bitcoins to its stash, valuing the company’s cryptocurrency holdings at around $7 billion. In its Q3 report on Oct. 28, the company outlined the purchase of 8,957 BTC.

Among MicroStrategy’s products are business intelligence software, mobile app software and cloud-based solutions, and it generates revenue through licensing and subscriptions.

In the past year, the software company has added 198% to its Bitcoin holdings, and as of Sept. 30 its total stood at 114,042 BTC, or $3.16 billion in spending. 

According to Microstrategy, the company’s BTC holdings are valued at $2.406 billion, resulting in an impairment loss of $754.7 million on paper.

Accounting rules require Bitcoin to be treated as an intangible asset, so the company must report an impairment loss if its carrying value dips below its cost basis. Paper gains on assets are not required to be reported until a profit is realized through a sale. 

At the time of writing, BTC is valued at $60,540, which means that MicroStrategy’s holdings are worth nearly $6.9 billion, meaning it would make nearly $3.75 billion if it sold today.

A major source of revenue for MicroStrategy is product licensing and subscription services, which generate revenue from business intelligence software, mobile apps, and cloud-based solutions.

Overall revenue for the quarter came in at $128 million, which beat the Zacks Consensus Estimate by 0.39% and marked a 0.5% increase over MicroStrategy’s Q3 results from 2020. 

Gross profit for the quarter tallied at $105.7 million, which was no different from the previous year. As compared to the loss of $14.2 million or $1.48 per share in Q3 2020, the net loss for Q3 2020 was $36.1 million, or $3.61 per share.

Earlier in the middle of September the firm purchased an additional 5,050 bitcoin for about $242.9 million in cash. 

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