Software analytics company MicroStrategy recorded a paper loss of over a billion dollars on its Bitcoin (BTC) holdings in 2022 but says it has no plans to stop trading the digital asset.
MicroStrategy released its 2022 Q4 and year-end earnings on Feb. 2 showing the recorded impairment charges on its BTC holdings, net of gains on sale, was nearly $1.3 billion over the full year 2022.
Despite the paper losses, on a Feb. 2 earnings call MicroStrategyโs chief financial officer, Andrew Kang, said:
โWe may consider pursuing additional transactions that may take advantage of the volatility in Bitcoin prices, or other market dislocations that are consistent with our long-term Bitcoin strategy.โ
On the call, MicroStrategy co-founder Michael Saylorย said the company measures its stock performance against โa number of different benchmarks,โ saying โthe most important benchmark is Bitcoinโs performance.โ
Saylor added that since MicroStrategy first announced it was buying Bitcoin in August 2020, the company has โbeen able to outperform Bitcoin as an indexโ over that time.
He said the companyโs stock is up 117% since August 2020, compared to Bitcoinโs gain of 98%, adding:
โThe only real safe haven for an institutional investor is Bitcoin. Bitcoin is the only universally acknowledged digital commodity, and so if you’re an investor, Bitcoin is your safe haven in this regard.โ
Kang stated that MicroStrategy held a total of 132,500 BTC worth $1.84 billion as of Dec. 31, 2022. Of that, 14,890 BTC were held directly by the business, with the remaining held in its subsidiary MacroStrategy LLC.
Related: US institutions account for 85% of Bitcoin buying in โvery positive signโ โ Matrixport
Late last year the company sold a portion of its Bitcoin holdings for the first time. Kang said that the 704 BTC were sold to harvest a tax loss of around $34 million and that even with the sale, the company โincreased our net holdings by 2500 Bitcoin during the quarter.โ
MicroStrategy’s overall revenue for the fourth quarter was $132.6 billion, reportedly beating Wall Street expectations. Its Q4 loss per share came in at $21.93.
At the time of writing, MicroStrategyโs stock price had fallen over 4% in after-hours trading,ย according to Yahoo Finance data.
