MicroStrategy Returns to Profitability Thanks to $8.17B Bitcoin Holdings

The largest publicly traded holder of Bitcoin, MicroStrategy, has bounced back to profitability in the fourth quarter, bolstered by a significant tax benefit linked to its substantial cryptocurrency reserves.

MicroStrategy disclosed this development during its recent presentation of financial records for the last quarter of 2023. Specifically, the company, led by Bitcoin advocate Michael Saylor, announced a net income of $89.1 million, or $4.96 per share. This marks a notable turnaround from the previous year’s loss of $249.7 million, or $21.93 per share.

In the fourth quarter of 2023, MicroStrategy reported total revenues of $124.5 million. This reflects a 6.1% decline from the same period in 2022. Also, revenues from product licenses and subscription services totaled $39.9 million. Similarly, the figure marked an 11.4% decrease compared to the same period in 2022. Revenues from other services in the fourth quarter of 2023 reached $19.1 million.

As of December 31, 2023, MicroStrategy’s digital assets, consisting of around 189,150 Bitcoin, were valued at $3.626 billion. Per the financial disclosure, this valuation reflects cumulative impairment losses of $2.269 billion since their acquisition, with an average carrying amount per Bitcoin of approximately $19,172.

Furthermore, as of the same date, the original cost basis and market value of MicroStrategy’s Bitcoin holdings were $5.895 billion and $8.045 billion, respectively. These figures translate to an average cost of approximately $31,168 and a market price per Bitcoin of $42,531.41.

Notably, in January, MicroStrategy acquired 850 BTC to make its total holdings 19,000 BTC, valued at over $8.17 billion.

MicroStrategy shares have reportedly surged over 300% since July 2020, outpacing benchmarks like the S&P 500 and the Nasdaq 100. In after-hours trading, MicroStrategy shares held steady at around $498, while Bitcoin traded at approximately $43,160.