MicroStrategy added 9,000 bitcoins last quarter, bringing its total holdings to $7 billion
MicroStrategy possessed 114,042 bitcoins as of Sept. 30 at an average purchase price of $27,713. MicroStrategy added about 9,000 Bitcoin to its holdings in Q3, valuing the company’s total BTC holdings at approximately $7 billion.
The business highlighted the acquisition of 8,957 BTC in its third-quarter report on Oct. 28, with perma-bull CEO Michael Saylor claiming that the firm would continue to accumulate BTC:
“With over 114,000 Bitcoins, MicroStrategy is the world’s biggest publicly listed business owner of Bitcoin.” We will continue to look for more cash to fund our Bitcoin strategy.” The software company raised its Bitcoin holdings by 198 percent year over year, to 114,042 BTC as of Sept. 30, at an estimated average purchase price of $27,713 per coin, or a $3.16 billion total expenditure.
Microstrategy reported a carrying value of $2.406 billion for its BTC assets and a $754.7 million impairment loss since the purchase, however, this is a paper loss.
Due to the fact that the corporation classifies Bitcoin as an “intangible asset,” accounting standards require it to disclose an impairment loss if the carrying value falls below the cost base. However, until a profit is achieved on the asset via a sale, the business is not obliged to record any paper profits on the asset.
Given that BTC is now trading at over $60,600, the value of MicroStrategy’s assets is around $6.9 billion, implying that the corporation would benefit by almost $3.75 billion if it sold today.
MicroStrategy develops business intelligence software, mobile application software, and cloud-based solutions. The company earns money via product licensing and subscription services.
The company announced total sales of $128 million for the quarter, topping the Zacks Consensus Estimate by 0.39 percent and representing a 0.5 percent rise over MicroStrategy’s Q3 2020 earnings.
While sales exceeded expectations, Microstrategy earned $1.86 per share, compared to the forecasted $1.12 per share. MicroStrategy has outperformed consensus predictions three times in the previous four quarters, according to the financial research company.
“This quarterly report represents a 66.07 percent profit surprise. “A quarter ago, this business software firm was predicted to earn $0.73 per share when it actually earned $1.72, producing a surprise of 135.62 percent,” according to Zacks Investment Research.
According to Saylor, the firm’s robust success in Q3 was fueled by “overall demand” for the MicroStrategy platform and increased acceptance of the firm’s cloud-based products.
The company had a gross profit of $105.7 million in the third quarter, the same as the previous year. The quarter ended with a net loss of $36.1 million, or $3.61 per share, compared to a loss of $14.2 million, or $1.48 per share, in Q3 2020.
Earlier today, Saylor reaffirmed his bullishness for digital gold by retweeting his own October 2020 post indicating personal ownership of 17,732 BTC.