MicroStrategy Reports $1 Billion Loss, CEO Steps Down To Focus On Bitcoin

MicroStrategy co-founder Michael Saylor gave up his chief executive officer title and said he’ll focus more on Bitcoin after the enterprise-software maker reported a loss of more than $1 billion related to the second-quarter plunge in the price of the cryptocurrency. Bloomberg reports: Saylor, who founded the Tysons Corner, Virginia-based company in 1989, will continue to serve as executive chairman as retains its Bitcoin buying strategy. MicroStrategy President Phong Le will take on the chief executive role. The company also filed with the Securities and Exchange Commission to register 450,000 shares. MicroStrategy took a $917.8 million impairment charge related to the decline in the value of the Bitcoin it holds. Bitcoin tumbled 59% in the quarter, and traded about 45% lower than the price at the end of the year-earlier period.

Revenue dropped to $122.1 million. Analysts polled by Bloomberg expected revenue of $123.25 million in the second quarter. Net quarterly loss of $1.062 billion compared with a loss of $299.3 million in the same quarter of last year. The quarterly loss is almost exactly twice the company’s revenue in the last 12 months. As of June 30, the carrying value of the company’s 129,699 Bitcoins was $1.988 billion, the company said, reflecting the cumulative impairment loss of $1.989 billion. The cumulative amount is now more than Bitcoin on the company’s balance sheet. “MicroStrategy’s original strategy and consulting business needs full-time attention,” said Henry Elder, head of decentralized finance at Wave Financial. “Now Michael can focus on what he does best, promoting Bitcoin. And the company can focus on making more money to buy more Bitcoin. They are basically doubling down.”