MicroStrategy Reports Q3 Results

Business intelligence firm MicroStrategy, the largest corporate holder of bitcoin, reported its third quarter financial results Wednesday, highlighted by a 5.1% increase in its "BTC Yield" and new plans to raise $42 billion in capital.

21/21 Plan

MicroStrategy (ticker MSTR) unveiled its "21/21 Plan," targeting $42 billion in capital over the next three years, split evenly between $21 billion in equity and $21 billion in fixed-income securities. This initiative aims to support further acquisitions of bitcoin as part of its treasury reserve strategy.

As of press time, MicroStrategy's total market capitalization was $50.1 billion, according to data from Yahoo Finance.

Bitcoin Holdings

As of Sept. 30, MicroStrategy held approximately 252,220 bitcoins with a market value of $16 billion. The company reported a year-to-date BTC Yield of 17.8%, a measure it uses to assess the performance of its bitcoin strategy.

Financial Highlights

In the third quarter, MicroStrategy raised $2.1 billion through equity and debt, expanded its bitcoin holdings by 11%, and reduced annual interest expenses by $24 million. The company recorded total revenues of $116.1 million, which missed consensus estimates by about $8 million and was down 10.3% from last year, attributed to declines in product license and support revenues.

Operating expenses for the quarter reached $514.3 million, largely due to $412.1 million in digital asset impairment losses, driving a loss from operations of $432.6 million. Net loss for the quarter was $340.2 million, or $1.72 per diluted share.

Future Outlook

Looking ahead, MicroStrategy adjusted its BTC Yield target for 2025-2027 to a range of between 6% and 10%, reflecting a more cautious outlook amid market volatility. The company announced a new at-the-market equity offering of up to $21 billion, set to be used to acquire more bitcoin and enhance shareholder value.

"Q3 was another pivotal quarter for us," said President and CEO Phong Le. "Our focus remains on leveraging digital assets to drive shareholder value, and our 21/21 Plan sets a clear path for future growth."

After falling 4% in the regular trading session, MSTR shares were down more than 8% in after-hours trading. The stock is still up more than 250% in the year-to-date period.