Bitcoin (BTC) uber-bull Michael Saylor’s software company MicroStrategy Incorporated (NASDAQ:MSTR) posted a rare quarterly profit on Monday, bolstered by the strong year-to-date rally on the world’s largest cryptocurrency.
As the world’s largest corporate bitcoin holder with 140,000 BTC on its balance sheet, MicroStrategy’s book value is closely tied to the digital asset’s market performance.
Digital asset impairment charges fell by 88% year on year (though still added US$19mln to costs) due bitcoin’s strong first-quarter performance; cumulative impairments since MicroStrategy’s bitcoin-buying strategy remain at over US$2.2bn.
MicroStrategy Incorporated (NASDAQ:MSTR) has spent a total of US$4.2bn on purchasing bitcoin, marking a per-bitcoin cost of exactly US$29,803, which is above the current spot price of US$28,000.
But on the balance sheet, MicroStrategy’s bitcoin stash is marked with an asset price of US$2bn.
In the last quarter, MicroStrategy increased its holdings by 7,500 for a net aggregate purchase amount of US$179 million, or slightly above $23,900 per bitcoin.
Wider company expenses stayed relatively flat, though the cost of revenues increased from US$25mln to US$27mln due to high cloud-hosting costs.
Revenues for the quarter increased 2% year on year to US$121.9mln, but net income soared to US$461mln due to a one-off US$453mln income tax benefit.
Bloomberg noted that the group reduced a reserve related to earlier impairment charges tied to bitcoin, resulting in the one-off tax benefit.
As a bitcoin-related stock, MicroStrategy has been on a tear in 2022, surging 133% at the time of writing.