MicroStrategy Q1 2023 Revenue Soars and Bitcoin Strategy Still in Play

MicroStrategy Q1 2023 Revenue Soars and Bitcoin Strategy Still in Play

MicroStrategy’s Q1 2023 financial results are in, revealing that the company has returned to profitability. At $147.8 million, total revenue for the quarter was up 2.6% compared to that of 2022, generating a gross profit of $122.5 million – which is an impressive 82.9% gross margin. Even after all the ups and downs, they have still kept their Bitcoin strategy intact.

Financial Analysis 

An analysis of MicroStrategy’s finances also revealed a 3.1% decrease in operating expenses in the same period, bringing the total to a grand sum of $92.3 million. This enabled the firm to achieve an impressive operating margin of 20.4%, generating income at a gross rate of $30.2 million, finally leading to net income being recorded as $23.9 million or $2.28 per share respectively

As of the end of March 2023, MicroStrategy had amassed approximately 134,000 bitcoins in its treasury coffers. At that date, the digital currency was estimated to be worth around $7.6 billion. Demonstrating a strong commitment to cryptocurrency hedging, CEO Michael Saylor reaffirmed his firm’s intentions to keep Bitcoin as its primary reserve asset regardless of market movement or regulatory flux.

The Crux of MicroStrategy Business 

MicroStrategy serves as an enterprise-scale provider of software services, maintaining a portfolio of both subscription and licensing offerings that constitute its primary source of profits.

For the fourth quarter of 2022, the company yielded a staggering net loss of $193.7 million – a substantial increase from its comparative $137.5 million deficit in 2021. This dramatic drop was primarily driven by an enormous impairment loss due to Bitcoin, amounting to an incredible $197.6 million.

Though MicroStrategy could turn its Bitcoin holdings into hard cash in order to stress-proof its balance sheet, it declared that it would remain uncommitted to adjusting its BTC acquiring tactics should such a situation arise. Instead, the organization has chosen other options such as equity dilutions and debt offerings to raise funds for purchasing crypto.

The MicroStrategy Stock MSTR

So far in 2023, the stock of MicroStrategy, symbol MSTR, has rocketed up by an impressive 140%, to a level not seen since September 2020 at $310 per share. It has closely tracked Bitcoin’s own rally of 90% YTD, correlating closely with the leading cryptocurrency.