MicroStrategy stock surges over 4% despite Q2 net loss as Bitcoin holdings hit 226,500

MicroStrategy posted a net loss of $123 million for the second quarter, an improvement from the $137 million loss in the previous quarter.

The company narrowed its quarterly losses on the back of lower impairment losses and a strategic increase in Bitcoin holdings, which now total 226,500 BTC.

Following the earnings announcement, MicroStrategy’s stock climbed 4.18% in after-hours trading as of press time, reflecting investor confidence in the company’s strategic direction and financial performance​

The adjusted loss per share for the quarter was $7.62, slightly better than the previous quarter’s loss of $8.26 per share. Comparatively, the firm reported an EPS of $2.35 in the same quarter of 2023.

Revenue for the second quarter was $111.4 million, below the consensus estimate of $122 million, and down from $115.2 million in the previous quarter and $120.4 million during the same period last year. Meanwhile, the firm reported a 21% year-over-year increase in subscription services revenues, totaling $24.1 million for the quarter.

MicroStrategy continued expanding its Bitcoin portfolio during the second quarter, acquiring 12,222 BTC at an average price of $65,882 each. The company further increased its holdings in July by acquiring an additional 169 BTC for $11.4 million.

The company’s total holdings stand at 226,500 BTC, purchased for $8.3 billion at an average cost of $36,821 per Bitcoin as of July 31.

MicroStrategy introduced  “BTC Yield” as a new key performance indicator to measure the percentage change in the ratio of its Bitcoin holdings to its assumed diluted shares outstanding. Based on the metric, the firm achieved a BTC Yield of 12.2% year-to-date, with an annual target yield of 4-8% from 2025-2027.

The company also recently raised $800 million through a convertible senior notes offering and announced a 10-for-1 stock split effective Aug. 7.

MicroStrategy continued to manage its equity capital closely, filing a registration statement for a new $2 billion at-the-market equity offering program.

MicroStrategy’s second-quarter results highlight the company’s efforts to balance its substantial Bitcoin holdings with the growth of its software business. The firm’s future performance will depend on navigating the volatility of the crypto market while advancing its business analytics services.

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