MicroStrategy Incorporated (Nasdaq: MSTR), which claims to be the largest independent publicly-traded business intelligence firm, revealed on December 21, 2020 that it has acquired an additional (approximately) 29,646 Bitcoins valued at around $650 million in cash – a move that’s in accordance or consistent with its Treasury Reserve Policy, at an average price of about $21,925 per coin (these figures are “inclusive of fees and expenses”).
MicroStrategy now holds around 70,470 Bitcoins, as of December 21, 2020. The company confirmed that these transactions were made at “an aggregate purchase price of approximately $1.125 billion and an average purchase price of approximately $15,964 per bitcoin, inclusive of fees and expenses.” Notably, these figures suggest that MicroStrategy has made around $500-$600 million in returns at current prices from these transactions.
Michael J. Saylor, CEO, MicroStrategy Incorporated, stated:
“[We] continue to operate in accordance with [the firm’s] Treasury Reserve Policy and [our company] currently holds approximately 70,470 bitcoins. The acquisition of additional Bitcoins announced today reaffirms our belief that Bitcoin, as the world’s most widely-adopted cryptocurrency, is a dependable store of value. We believe the proactive management of our balance sheet, combined with the improved revenue and profitability performance of the company, have been significant factors in the recent appreciation in our stock price.”
Phong Le, President & CFO, MicroStrategy, noted that the firm continues to believe that Bitcoin will offer an opportunity for earning superior returns and help with preserving the value of their company’s capital over an extended period of time when compared to simply holding cash. Le confirmed that the company remains focused on providing the best services to its clients. MicroStrategy is also committed to its goal of running a growing profitable business intelligence firm, Le noted
He added that as the company continues to generate more revenue through its line of proprietary products such as HyperIntelligence, Cloud Intelligence and Embedded Intelligence offerings, it expects “to continue to generate positive operating income and free cash flow and will continue to evaluate the use of excess cash in accordance with our capital allocation strategy and Treasury Reserve Policy.”
As reported on December 11, 2020, MicroStrategy added another $100 million to its note offering to purchase more Bitcoin (BTC). As covered on December 8, 2020, MicroStrategy had proposed a private offering of $400 million of convertible notes so that the proceeds may be invested in Bitcoin, the flagship cryptocurrency.
MicroStrategy offers a comprehensive enterprise analytics platform. The company states that it aims to enable “Intelligence Everywhere.” MicroStrategy provides modern analytics on an open, enterprise platform that’s reportedly used by the Fortune Global 500. The platform has been optimized for Cloud and on-premises deployments.
On August 11, 2020, MicroStrategy’s management revealed that they had acquired 21,454 Bitcoins at “an aggregate purchase price of $250 million, inclusive of fees and expenses.”
The company said that it had adopted Bitcoin as a “primary reserve asset” as part of its capital allocation strategy which involved investing a significant amount of its holdings in alternative investments.