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MicroStrategy, the world’s largest corporate Bitcoin holder, is looking to fatten its BTC reserves by selling a portion of its class A shares.
The announcement came as the firm reported a net loss of $123 million in the second quarter of 2024.
According to a recent filing with the U.S. Securities and Exchange Commission, the company aims to raise $2 billion by selling its class A shares.
The filing states that the proceeds from the sale would be used for “general corporate purposes, including the acquisition of bitcoin.”
The filing did not specify when the sale would be executed or what portion of it would be used to acquire Bitcoin.
Per the filing, the company has not determined what portion of the proceeds would be “used specifically for any particular purpose.”
Net loss hasn’t affected Bitcoin strategy
The filing came alongside MicroStrategy’s Q2 financial results, in which it posted a net loss of $123 million in Q2 2024, with a loss of $5.74 per share.
The firm’s quarterly revenue was down 7% year-over-year.
Despite the downturn, the business intelligence company purchased 2,222 Bitcoin for $805 million during the same quarter as a part of its Bitcoin strategy.
First announced in 2020, the firm plans to acquire Bitcoin using cash flows from operations and proceeds from equity and debt financings under this scheme.
The firm, along with its CEO Michael Saylor, who is a vocal advocate of Bitcoin, views the flagship cryptocurrency as a long-term investment.
There’s no predetermined target amount, and the company has continued to acquire Bitcoin periodically over the years. At the time of publication, the firm’s total Bitcoin holdings stand at 226,500 BTC, valued at approximately $14.7 billion at press time.
As mentioned in the earnings report, the Bitcoin stash was acquired for $8.5 billion, with an average price of $36,821 per Bitcoin. The most recent purchase, for 11,931 BTC, which saw the company spend $786 million at the time, was executed on June 20.
In March, the company had acquired another 9,245 BTC for $623 million. Both acquisitions were made via debt issuance.
The Virginia-based company also unveiled a new performance indicator during its earnings call dubbed “Bitcoin Yield.”
It tracks the percentage change over time in the ratio between the firm’s Bitcoin holdings and its diluted outstanding shares, which comprise the company’s common stocks, along with any additional shares created from convertible notes or exercising stock options.
MicroStrategy’s Bitcoin yield is 12.2% year-to-date. Over the next three years, the firm plans to maintain a rate of 4%–8% annually.
At the time of writing, MicroStrategy shares were down over 6%.
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