MicroStrategy, the business intelligence giant led by Michael Saylor, has returned to profitability for the first time since 2020, primarily due to a one-time income tax benefit of $453.2 million. The firm reported a Q1 2023 profit of $94 million, with revenues of $121.9 million,...
MicroStrategy, the business intelligence giant led by Michael Saylor, has returned to profitability for the first time since 2020, primarily due to a one-time income tax benefit of $453.2 million. The firm reported a Q1 2023 profit of $94 million, with revenues of $121.9 million, a 2.2% increase year-over-year.
Please join the @MicroStrategy management team at 5pm ET as we discuss our Q1 2023 $MSTR financial results and answer questions about our business and outlook for #BusinessIntelligence and #Bitcoin.https://t.co/pHrjKvWsDU— Michael Saylor(@saylor) May 1, 2023
In a May 1 statement, CEO Phong Lee reaffirmed MicroStrategy’s unwavering commitment to its Bitcoin investment strategy, saying the company’s conviction in the digital asset’s potential remains strong as the market continues to mature.
“We remain disciplined on costs while investing in growth, and we will continue to execute our dual strategy of growing our business intelligence software business and acquiring Bitcoin for the future,” he added.
Lee also reassured stakeholders that short-term Bitcoin price fluctuations would not impact the company’s core business.
Michael Saylor, the chairman of MicroStrategy, credited the successful quarter to the company’s steadfast execution of its core business model and Bitcoin investment thesis.
Saylor also predicted that investors would soon exit positions in cryptocurrencies facing regulatory scrutiny, resulting in capital flowing into Bitcoin.
MicroStrategy’s CFO, Andrew Kang, also revealed that the firm retired its $161 million Bitcoin-backed loan from the now-defunct Silverage Bank, releasing all pledged Bitcoin collateral in the process. This strategic move played a significant role in the company’s liability management goals.
According to SEC filings, MicroStrategy acquired 7,500 BTC in Q1 2023 for a total of $179 million. The firm currently holds 140,000 BTC, purchased at an average cost of approximately $29,803. Bitcoin’s 72% price increase over Q1 2023 to roughly $28,300 contributed to the company’s profitability, although the current price of $28,100 marks a 5.7% drop in the value of MicroStrategy’s Bitcoin investment.
However, the company saw brief gains when Bitcoin surged to a recent high of $30,980 on April 15.
— Michael Saylor(@saylor) May 1, 2023
MicroStrategy began investing in Bitcoin in March 2021, purchasing 91,064 BTC, which now represents 65% of its total holdings. The company recently integrated the Bitcoin Lightning Network into Saylor’s corporate email address and is developing a Bitcoin layer-2 Lightning Network-based Software as a Service tool for corporations.