MicroStrategy Adds 169 BTC to Holdings, Unveils New ‘Bitcoin Yield’ KPI

On August 1, MicroStrategy founder Michael Saylor announced that in July, the firm acquired an additional 169 BTC for $11.4 million and now holds a total of 226,500 BTC.

The company continues to focus on its bitcoin acquisition strategy. However, it faced significant impairment losses due to BTC price fluctuations, resulting in a second consecutive quarterly loss.

The world’s largest corporate holder of BTC now has $14.6 billion worth at current spot prices, and it wants more.

Total revenues for the second quarter were $111.4 million, a 7.4% decrease from Q2 2023 and lower than analysts’ forecasts of $119.3 million. Gross profit came in at $80.5 million.

Bitcoin Yield KPI Unveiled

The carrying value of its BTC holdings for the period was $5.68 billion, reflecting cumulative impairment losses of $2.64 billion. Nevertheless, the original cost basis was $8.33 billion, with the average cost per bitcoin at $36,798.

MicroStrategy President and Chief Executive Officer Phong Le said the firm’s holdings were valued at “70% higher than our cost basis” before adding:

“We remain laser-focused on our Bitcoin development strategy and intend to continue to achieve positive ‘BTC Yield,’ which is a new KPI that we are introducing, targeting 4-8% annually, over each of the next three years.”

The Bitcoin Key Performance Indicator that MicroStrategy introduced represents the percentage change period-to-period of the ratio between the firm’s BTC holdings and its Assumed Diluted Shares Outstanding.

It compares the company’s BTC holdings to its potential total shares outstanding, including actual shares outstanding plus all potential shares from convertible notes, stock options, and other equity awards.

MicroStrategy will use the KPI to assess the performance of its bitcoin strategy in a way the team believes is accretive to shareholders. The 2024 BTC Yield is 12.2% year-to-date, and the company is aiming for an annual BTC Yield of 4-8% from 2025-2027.

Equity Offering

The firm also reported that it raised $800 million through 2.25% convertible senior notes due 2032 and redeemed $650 million convertible senior notes due 2025.

Andrew Kang, Chief Financial Officer at MicroStrategy, also announced an equity offering:

“We continue to closely manage our equity capital, and are filing a registration statement for a new $2 billion at-the-market equity offering program.”

In July, Saylor announced that the firm will soon undergo a 10-for-1 stock split, which will make it more affordable for smaller investors to gain minimal exposure to company shares.

MicroStrategy shares (MSTR) fell 6% on the day below $1,500 but recovered to settle at $1,569 in after-hours trading.