MicroStrategy Shares Drop 3% Following Disappointing Q3 Results

TYSONS CORNER, Va. - MicroStrategy Inc. (NASDAQ:MSTR) saw its shares drop by 3.9% after it reported third-quarter financial results that fell short of analyst expectations following the market close on Wednesday. The business intelligence software and bitcoin investment company reported a loss of $1.56 per share and revenue of $116.1 million for the quarter ending September 30. Analysts were expecting a lower loss of $0.12 per share and revenue of $121.45 million. Total revenue decreased by 10.3% year-over-year, while revenue from product licenses and subscription services dropped by 13.6% to $38.9 million. Revenue from subscription services increased by 32.5% to $27.8 million, but this gain was offset by a 53.9% decline in product license revenue, which fell to $11.1 million. The company reported a net loss of $340.2 million for this quarter, compared to a net loss of $143.4 million in the same period last year. The main reason for the increase in loss was due to a $412.1 million impairment related to MicroStrategy's bitcoin assets. "This quarter represented another transformational quarter for MicroStrategy as we raised $2.1 billion in equity and debt," said Chief Financial Officer Andrew Kang. "Thanks to our treasury strategy, we increased our bitcoin assets by 11% this quarter, raised our year-to-date BTC yield to 17.8%, and reduced our total annual interest expense by $24 million." As of September 30, MicroStrategy owned approximately 252,220 bitcoins, acquired for a total of $9.9 billion at an average purchase price of $39,266. The company announced plans to raise up to $42 billion in additional capital to purchase more bitcoins over the next three years.