Business intelligence company MicroStrategy on Thursday reported its eighth consecutive quarterly loss but continues the strategy to hold Bitcoin on its balance sheet.
After the Q4 earnings report, Bitcoin price fell to a low of $23,439. MicroStrategy shares jump almost 10% to $300 on Thursday, but trades below $280 in pre-market hours.
MicroStrategy Reports $1.3 Billion Impairment Loss
According to Q4 financial results, MicroStrategy holds 132,500 bitcoins valued at $1.840 billion. It reflects impairment losses of $2.153 billion since acquisition and an average carrying amount per bitcoin of about $13,887. Also, MicroStrategy’s impairment losses on Bitcoin were $197.6 million during the fourth quarter of 2022, compared to $146.6 million in Q4 2021.
As of December 31, 2022, the original cost basis and market value of MicroStrategy’s bitcoin were $3.993 billion and $2.194 billion, respectively. Thus, it makes an average cost per bitcoin of approximately $30,137 and a market price per bitcoin of $16,556.32, respectively.
Last quarter, the company sold 704 BTC for the first time to manage a tax loss of $34 million. However, the company added 2500 BTC after the sale, increasing its total Bitcoin holdings.
During the earnings call, Executive Chairman Michael Saylor said the company has performed better than major indices and companies such as Google, Apple, Microsoft, and Amazon after it added Bitcoin.
Andrew Kang, Chief Financial Officer of MicroStrategy, said:
“Our corporate strategy and conviction in acquiring, holding, and growing our bitcoin position for the long term remains unchanged. And while we encountered macroeconomic and foreign currency headwinds in 2022, we continue to shift to higher quality, recurring revenues as we grow and scale our cloud business.”
Bitcoin Price and Shares Fall After MicroStrategy Earnings
While investors are confident over MicroStrategy’s stock performance in 2023 as share price rises above $300 after a year, with over 100% jump in just a month after Bitcoin rises above $24K. However, the MSTR price is trading at 280, down over 4% in pre-market hours.
Bitcoin (BTC) price also fell to a low of $23,439 after hitting a high of $24,091. At the time of writing, Bitcoin price is trading at $23,526, down 1% in the last 24 hours.
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