MicroStrategy Announces Second Quarter 2024 Financial Results; Now Holds 226,500 BTC
-
Previously announced 10-for-1 forward stock split effective
August 7, 2024 -
12,222 bitcoins acquired since the beginning of Q2 for
$805.2 million , or$65,882 per bitcoin -
226,500 bitcoin holdings at a total cost of
$8.3 billion , or$36,821 per bitcoin, as ofJuly 31, 2024 - “BTC Yield” (a key performance indicator for our bitcoin strategy) year-to-date of 12.2%
-
Subscription Services Revenues of
$24.1 million , up 21% year-over-year
“After yet another successful quarter for our bitcoin strategy,
“In Q2, we successfully raised an additional
The Company previously announced that its board of directors had declared a 10-for-1 stock split of the Company’s class A common stock and class B common stock. The stock split will be effected by means of a stock dividend to the holders of record of the Company’s class A common stock and class B common stock as of the close of business on
Second Quarter 2024 Financial Highlights
- Bitcoin Yield KPI: BTC Yield is a key performance indicator (“KPI”) that represents the % change period-to-period of the ratio between the Company’s bitcoin holdings and its Assumed Diluted Shares Outstanding. Assumed Diluted Shares Outstanding refers to the aggregate of the Company’s actual shares of common stock outstanding as of the end of the applicable period plus all additional shares that would result from the assumed conversion of all outstanding convertible notes, exercise of all outstanding stock option awards, and settlement of all outstanding restricted stock units and performance stock units. The Company uses BTC Yield as a KPI to help assess the performance of its strategy of acquiring bitcoin in a manner the Company believes is accretive to shareholders. The Company believes this KPI can be used to supplement an investor’s understanding of the Company’s decision to fund the purchase of bitcoin by issuing additional shares of its common stock or instruments convertible to common stock. Year-to-date 2024, the Company’s BTC Yield is 12.2%. The Company is targeting to achieve an annual BTC Yield of 4-8% from 2025-2027.
-
Digital Assets: As of
June 30, 2024 , the carrying value of the Company’s digital assets (comprised of approximately 226,331 bitcoins) was$5.688 billion , which reflects cumulative impairment losses of$2.641 billion since acquisition and an average carrying amount per bitcoin of approximately$25,131 . As ofJune 30, 2024 , the original cost basis and market value of the Company’s bitcoin were$8.329 billion and$14.016 billion , respectively, which reflects an average cost per bitcoin of approximately$36,798 and a market price per bitcoin of$61,926.69 , respectively. -
Issuance of 2032 Convertible Notes: In
June 2024 , the Company issued$800.0 million aggregate principal amount of 2.250% Convertible Senior Notes due 2032 (the “2032 Convertible Notes”) with an initial conversion price of$2,043.32 per share of class A common stock. -
Redemption and Conversions of 2025 Convertible Notes: On
June 13, 2024 , the Company announced that it delivered a notice of redemption to the trustee of its 0.750% Convertible Senior Notes due 2025 (the “2025 Convertible Notes”) for redemption of all$650.0 million in aggregate principal amount of the 2025 Convertible Notes then outstanding onJuly 15, 2024 (the “Redemption Date”). The holders of substantially all of the 2025 Convertible Notes converted such notes into shares of our class A common stock prior to the Redemption Date. -
Revenues: Total revenues were
$111.4 million , a 7.4% decrease, or a 6.9% decrease on a non-GAAP constant currency basis, compared to the second quarter of 2023. Subscription Services Revenues were$24.1 million , a 21.1% increase, or a 21.8% increase on a non-GAAP constant currency basis, compared to the second quarter of 2023. Product licenses and subscription services revenues were$33.4 million , a 5.7% decrease, or a 5.3% decrease on a non-GAAP constant currency basis, compared to the second quarter of 2023. Product support revenues were$61.7 million , a 6.6% decrease, or a 6.0% decrease on a non-GAAP constant currency basis, compared to the second quarter of 2023. Other services revenues were$16.3 million , a 13.7% decrease, or a 12.9% decrease on a non-GAAP constant currency basis, compared to the second quarter of 2023. -
Gross Profit: Gross profit was
$80.5 million , representing a 72.2% gross margin, compared to$93.3 million , representing a gross margin of 77.5%, for the second quarter of 2023. -
Operating Expenses: Operating expenses were
$280.8 million , a 134.0% increase compared to the second quarter of 2023. Operating expenses include impairment losses on the Company’s digital assets, which were$180.1 million during the second quarter of 2024, compared to$24.1 million in the second quarter of 2023. -
Loss from Operations and Net (Loss) Income: Loss from operations was
$200.3 million , compared to$26.7 million for the second quarter of 2023. Net loss was$102.6 million , or$5.74 per share on a diluted basis, as compared to a net income of$22.2 million , or$1.52 per share on a diluted basis, for the second quarter of 2023. Digital asset impairment losses of$180.1 million and$24.1 million for the second quarter of 2024 and 2023, respectively, were reflected in these amounts. -
Cash and Cash Equivalents: As of
June 30, 2024 , the Company had cash and cash equivalents of$66.9 million , as compared to$46.8 million as ofDecember 31, 2023 , an increase of$20.1 million .
The tables provided at the end of this press release include a reconciliation of the most directly comparable financial measures prepared in accordance with generally accepted accounting principles in
Non-GAAP Financial Measures
Important Information about BTC Yield KPI
BTC Yield is a key performance indicator (“KPI”) that represents the % change period-to-period of the ratio between the Company’s bitcoin holdings and its Assumed Diluted Shares Outstanding. Assumed Diluted Shares Outstanding refers to the aggregate of the Company’s actual shares of common stock outstanding as of the end of each period plus all additional shares that would result from the assumed conversion of all outstanding convertible notes, exercise of all outstanding stock option awards, and settlement of all outstanding restricted stock units and performance stock units. Assumed Diluted Shares Outstanding is not calculated using the treasury method and does not take into account any vesting conditions (in the case of equity awards), the exercise price of any stock option awards or any contractual conditions limiting convertibility of convertible debt instruments.
The Company uses BTC Yield as a KPI to help assess the performance of its strategy of acquiring bitcoin in a manner the Company believes is accretive to shareholders. The Company believes this KPI can be used to supplement an investor’s understanding of its decision to fund the purchase of bitcoin by issuing additional shares of its common stock or instruments convertible to common stock. When the Company uses this KPI, management also takes into account the various limitations of this metric, including that it does not take into account debt and other liabilities and claims on company assets that would be senior to common equity and that it assumes that all indebtedness will be refinanced or, in the case of the Company’s senior convertible debt instruments, converted into shares of common stock in accordance with their respective terms.
Additionally, this KPI is not, and should not be understood as, an operating performance measure or a financial or liquidity measure. In particular, BTC Yield is not equivalent to “yield” in the traditional financial context. It is not a measure of the return on investment the Company’s shareholders may have achieved historically or can achieve in the future by purchasing stock of the Company, or a measure of income generated by the Company’s operations or its bitcoin holdings, return on investment on its bitcoin holdings, or any other similar financial measure of the performance of its business or assets.
The trading price of the Company’s class A common stock is informed by numerous factors in addition to the amount of bitcoins the Company holds and number of actual or potential shares of its stock outstanding, and as a result, the market value of the Company’s shares may trade at a discount or a premium relative to the market value of the bitcoin the Company holds, and BTC Yield is not indicative nor predictive of the trading price of the Company’s shares of class A common stock.
As noted above, this KPI is narrow in its purpose and is used by management to assist it in assessing whether the Company is using equity capital in a manner accretive to shareholders solely as it pertains to its bitcoin holdings.
In calculating this KPI, the Company does not take into account the source of capital used for the acquisition of its bitcoin. The Company notes in particular, it has acquired bitcoin using proceeds from the offerings of its 6.125% Senior Secured Notes due 2028 (the “Senior Secured Notes”) as well as convertible senior notes, which currently are not exercisable or have conversion prices above the current trading prices of the Class A common stock, each of which would have the effect of increasing the BTC Yield without taking into account the corresponding debt. Conversely, if any of the Company’s convertible senior notes mature or are redeemed without being converted into common stock or the Company needs cash to repay the Senior Secured Notes, the Company may be required to sell shares in quantities greater than the shares such notes are convertible into or generate cash proceeds from the sale of bitcoin, either of which would have the effect of decreasing the BTC Yield due to changes in the Company’s bitcoin holdings and shares in ways that were not contemplated by the assumptions in calculating BTC Yield. Accordingly, this metric might overstate or understate the accretive nature of the Company’s use of equity capital to buy bitcoin because not all bitcoin may be acquired using proceeds of equity offerings and not all issuances of equity may involve the acquisition of bitcoin.
The Company determines its KPI targets based on its history and future goals. The Company’s ability to achieve positive BTC Yield may depend on a variety of factors, including its ability to generate cash from operations in excess of its fixed charges and other expenses, as well as factors outside of its control, such as the availability of debt and equity financing on favorable terms. Past performance is not indicative of future results.
The Company has historically not paid any dividends on its shares of common stock, and by presenting this KPI the Company makes no suggestion that it intends to do so in the future. Ownership of common stock does not represent an ownership interest in the bitcoin the Company holds.
Investors should rely on the financial statements and other disclosures contained in the Company’s
Conference Call
About
This press release may include statements that may constitute “forward-looking statements,” including estimates of future business prospects or financial results, our targets relating to our BTC Yield, and statements containing the words “believe,” “estimate,” “project,” “expect,” “will,” or similar expressions. Forward-looking statements inherently involve risks and uncertainties that could cause actual results of
|
||||||||||||||||
CONSOLIDATED STATEMENTS OF OPERATIONS |
||||||||||||||||
(in thousands, except per share data) |
||||||||||||||||
|
||||||||||||||||
|
|
Three Months Ended |
|
|
Six Months Ended |
|
||||||||||
|
|
|
|
|
|
|
||||||||||
|
|
2024 |
|
|
2023 |
|
|
2024 |
|
|
2023 |
|
||||
|
|
(unaudited) |
|
|
(unaudited) |
|
|
(unaudited) |
|
|
(unaudited) |
|
||||
Revenues: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Product licenses |
|
$ |
9,286 |
|
|
$ |
15,522 |
|
|
$ |
22,224 |
|
|
$ |
32,934 |
|
Subscription services |
|
|
24,080 |
|
|
|
19,878 |
|
|
|
47,046 |
|
|
|
38,688 |
|
Total product licenses and subscription services |
|
|
33,366 |
|
|
|
35,400 |
|
|
|
69,270 |
|
|
|
71,622 |
|
Product support |
|
|
61,740 |
|
|
|
66,081 |
|
|
|
124,425 |
|
|
|
131,562 |
|
Other services |
|
|
16,336 |
|
|
|
18,919 |
|
|
|
32,993 |
|
|
|
39,131 |
|
Total revenues |
|
|
111,442 |
|
|
|
120,400 |
|
|
|
226,688 |
|
|
|
242,315 |
|
Cost of revenues: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Product licenses |
|
|
794 |
|
|
|
444 |
|
|
|
1,361 |
|
|
|
978 |
|
Subscription services |
|
|
9,560 |
|
|
|
7,216 |
|
|
|
18,164 |
|
|
|
15,072 |
|
Total product licenses and subscription services |
|
|
10,354 |
|
|
|
7,660 |
|
|
|
19,525 |
|
|
|
16,050 |
|
Product support |
|
|
8,193 |
|
|
|
5,816 |
|
|
|
16,740 |
|
|
|
11,584 |
|
Other services |
|
|
12,388 |
|
|
|
13,645 |
|
|
|
24,685 |
|
|
|
27,428 |
|
Total cost of revenues |
|
|
30,935 |
|
|
|
27,121 |
|
|
|
60,950 |
|
|
|
55,062 |
|
Gross profit |
|
|
80,507 |
|
|
|
93,279 |
|
|
|
165,738 |
|
|
|
187,253 |
|
Operating expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Sales and marketing |
|
|
34,251 |
|
|
|
37,660 |
|
|
|
67,702 |
|
|
|
73,766 |
|
Research and development |
|
|
30,311 |
|
|
|
29,354 |
|
|
|
59,494 |
|
|
|
60,712 |
|
General and administrative |
|
|
36,129 |
|
|
|
28,830 |
|
|
|
70,795 |
|
|
|
56,736 |
|
Digital asset impairment losses |
|
|
180,090 |
|
|
|
24,143 |
|
|
|
371,723 |
|
|
|
43,054 |
|
Total operating expenses |
|
|
280,781 |
|
|
|
119,987 |
|
|
|
569,714 |
|
|
|
234,268 |
|
Loss from operations |
|
|
(200,274 |
) |
|
|
(26,708 |
) |
|
|
(403,976 |
) |
|
|
(47,015 |
) |
Interest expense, net |
|
|
(15,466 |
) |
|
|
(11,095 |
) |
|
|
(27,347 |
) |
|
|
(26,025 |
) |
Gain on debt extinguishment |
|
|
0 |
|
|
|
0 |
|
|
|
0 |
|
|
|
44,686 |
|
Other income (expense), net |
|
|
694 |
|
|
|
(250 |
) |
|
|
2,390 |
|
|
|
(1,693 |
) |
Loss before income taxes |
|
|
(215,046 |
) |
|
|
(38,053 |
) |
|
|
(428,933 |
) |
|
|
(30,047 |
) |
Benefit from income taxes |
|
|
(112,487 |
) |
|
|
(60,296 |
) |
|
|
(273,256 |
) |
|
|
(513,483 |
) |
Net (loss) income |
|
$ |
(102,559 |
) |
|
$ |
22,243 |
|
|
$ |
(155,677 |
) |
|
$ |
483,436 |
|
Basic (loss) earnings per share (1) |
|
$ |
(5.74 |
) |
|
$ |
1.68 |
|
|
$ |
(8.88 |
) |
|
$ |
41.18 |
|
Weighted average shares outstanding used in computing basic (loss) earnings per share |
|
|
17,861 |
|
|
|
13,247 |
|
|
|
17,533 |
|
|
|
11,739 |
|
Diluted (loss) earnings per share (1) |
|
$ |
(5.74 |
) |
|
$ |
1.52 |
|
|
$ |
(8.88 |
) |
|
$ |
33.56 |
|
Weighted average shares outstanding used in computing diluted (loss) earnings per share |
|
|
17,861 |
|
|
|
16,095 |
|
|
|
17,533 |
|
|
|
14,534 |
|
|
||||||||||||||||
(1) Basic and fully diluted (loss) earnings per share for class A and class B common stock are the same. |
|
||||||||
CONSOLIDATED BALANCE SHEETS |
||||||||
(in thousands, except per share data) |
||||||||
|
||||||||
|
|
|
|
|
|
|
||
|
|
2024 |
|
|
2023* |
|
||
|
|
(unaudited) |
|
|
|
|
||
Assets |
|
|
|
|
|
|
||
Current assets |
|
|
|
|
|
|
||
Cash and cash equivalents |
|
$ |
66,923 |
|
|
$ |
46,817 |
|
Restricted cash |
|
|
1,878 |
|
|
|
1,856 |
|
Accounts receivable, net |
|
|
112,234 |
|
|
|
183,815 |
|
Prepaid expenses and other current assets |
|
|
27,234 |
|
|
|
35,407 |
|
Total current assets |
|
|
208,269 |
|
|
|
267,895 |
|
|
|
|
|
|
|
|
||
Digital assets |
|
|
5,687,890 |
|
|
|
3,626,476 |
|
Property and equipment, net |
|
|
28,332 |
|
|
|
28,941 |
|
Right-of-use assets |
|
|
53,591 |
|
|
|
57,343 |
|
Deposits and other assets |
|
|
43,449 |
|
|
|
24,300 |
|
Deferred tax assets, net |
|
|
1,031,542 |
|
|
|
757,573 |
|
Total Assets |
|
$ |
7,053,073 |
|
|
$ |
4,762,528 |
|
|
|
|
|
|
|
|
||
Liabilities and Stockholders’ Equity |
|
|
|
|
|
|
||
Current liabilities |
|
|
|
|
|
|
||
Accounts payable, accrued expenses, and operating lease liabilities |
|
$ |
44,188 |
|
|
$ |
43,090 |
|
Accrued compensation and employee benefits |
|
|
46,853 |
|
|
|
50,045 |
|
Accrued interest |
|
|
5,066 |
|
|
|
1,493 |
|
Current portion of long-term debt, net |
|
|
145,119 |
|
|
|
483 |
|
Deferred revenue and advance payments |
|
|
204,837 |
|
|
|
228,162 |
|
Total current liabilities |
|
|
446,063 |
|
|
|
323,273 |
|
|
|
|
|
|
|
|
||
Long-term debt, net |
|
|
3,703,381 |
|
|
|
2,182,108 |
|
Deferred revenue and advance payments |
|
|
5,964 |
|
|
|
8,524 |
|
Operating lease liabilities |
|
|
56,544 |
|
|
|
61,086 |
|
Other long-term liabilities |
|
|
5,965 |
|
|
|
22,208 |
|
Deferred tax liabilities |
|
|
357 |
|
|
|
357 |
|
Total liabilities |
|
|
4,218,274 |
|
|
|
2,597,556 |
|
|
|
|
|
|
|
|
||
Stockholders’ Equity |
|
|
|
|
|
|
||
Preferred stock undesignated, |
|
|
0 |
|
|
|
0 |
|
Class A common stock, |
|
|
26 |
|
|
|
24 |
|
Class B convertible common stock, |
|
|
2 |
|
|
|
2 |
|
Additional paid-in capital |
|
|
4,785,336 |
|
|
|
3,957,728 |
|
|
|
|
(782,104 |
) |
|
|
(782,104 |
) |
Accumulated other comprehensive loss |
|
|
(13,550 |
) |
|
|
(11,444 |
) |
Accumulated deficit |
|
|
(1,154,911 |
) |
|
|
(999,234 |
) |
Total Stockholders’ Equity |
|
|
2,834,799 |
|
|
|
2,164,972 |
|
Total Liabilities and Stockholders’ Equity |
|
$ |
7,053,073 |
|
|
$ |
4,762,528 |
|
|
||||||||
* Derived from audited financial statements. |
|
||||||||
CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS |
||||||||
(in thousands) |
||||||||
|
||||||||
|
|
Six Months Ended |
|
|||||
|
|
|
|
|||||
|
|
2024 |
|
|
2023 |
|
||
|
|
(unaudited) |
|
|
(unaudited) |
|
||
Net cash provided by operating activities |
|
$ |
5,258 |
|
|
$ |
18,925 |
|
Net cash used in investing activities |
|
|
(2,435,405 |
) |
|
|
(527,416 |
) |
Net cash provided by financing activities |
|
|
2,451,831 |
|
|
|
525,911 |
|
Effect of foreign exchange rate changes on cash, cash equivalents, and restricted cash |
|
|
(1,556 |
) |
|
|
(235 |
) |
Net increase in cash, cash equivalents, and restricted cash |
|
|
20,128 |
|
|
|
17,185 |
|
Cash, cash equivalents, and restricted cash, beginning of period |
|
|
48,673 |
|
|
|
50,868 |
|
Cash, cash equivalents, and restricted cash, end of period |
|
$ |
68,801 |
|
|
$ |
68,053 |
|
|
||||||||||||||||||||||
DIGITAL ASSETS – ADDITIONAL INFORMATION |
||||||||||||||||||||||
ROLLFORWARD OF BITCOIN HOLDINGS |
||||||||||||||||||||||
(unaudited) |
||||||||||||||||||||||
|
||||||||||||||||||||||
|
|
Source of Capital Used to Purchase Bitcoin |
|
Digital Asset Original Cost Basis (in thousands) |
|
|
Digital Asset Impairment Losses (in thousands) |
|
|
Digital Asset Carrying Value (in thousands) |
|
|
Approximate Number of Bitcoins Held * |
|
|
Approximate Average Purchase Price Per Bitcoin |
|
|||||
Balance at |
|
|
|
$ |
3,993,190 |
|
|
$ |
(2,153,162 |
) |
|
$ |
1,840,028 |
|
|
|
132,500 |
|
|
$ |
30,137 |
|
Digital asset purchases |
|
(a) |
|
|
179,275 |
|
|
|
|
|
|
179,275 |
|
|
|
7,500 |
|
|
|
23,903 |
|
|
Digital asset impairment losses |
|
|
|
|
|
|
|
(18,911 |
) |
|
|
(18,911 |
) |
|
|
|
|
|
|
|||
Balance at |
|
|
|
$ |
4,172,465 |
|
|
$ |
(2,172,073 |
) |
|
$ |
2,000,392 |
|
|
|
140,000 |
|
|
$ |
29,803 |
|
Digital asset purchases |
|
(b) |
|
|
347,003 |
|
|
|
|
|
|
347,003 |
|
|
|
12,333 |
|
|
|
28,136 |
|
|
Digital asset impairment losses |
|
|
|
|
|
|
|
(24,143 |
) |
|
|
(24,143 |
) |
|
|
|
|
|
|
|||
Balance at |
|
|
|
$ |
4,519,468 |
|
|
$ |
(2,196,216 |
) |
|
$ |
2,323,252 |
|
|
|
152,333 |
|
|
$ |
29,668 |
|
Digital asset purchases |
|
(c) |
|
|
161,681 |
|
|
|
|
|
|
161,681 |
|
|
|
5,912 |
|
|
|
27,348 |
|
|
Digital asset impairment losses |
|
|
|
|
|
|
|
(33,559 |
) |
|
|
(33,559 |
) |
|
|
|
|
|
|
|||
Balance at |
|
|
|
$ |
4,681,149 |
|
|
$ |
(2,229,775 |
) |
|
$ |
2,451,374 |
|
|
|
158,245 |
|
|
$ |
29,582 |
|
Digital asset purchases |
|
(d) |
|
|
1,214,340 |
|
|
|
|
|
|
1,214,340 |
|
|
|
30,905 |
|
|
|
39,293 |
|
|
Digital asset impairment losses |
|
|
|
|
|
|
|
(39,238 |
) |
|
|
(39,238 |
) |
|
|
|
|
|
|
|||
Balance at |
|
|
|
$ |
5,895,489 |
|
|
$ |
(2,269,013 |
) |
|
$ |
3,626,476 |
|
|
|
189,150 |
|
|
$ |
31,168 |
|
Digital asset purchases |
|
(e) |
|
|
1,639,309 |
|
|
|
|
|
|
1,639,309 |
|
|
|
25,128 |
|
|
|
65,238 |
|
|
Digital asset impairment losses |
|
|
|
|
|
|
|
(191,633 |
) |
|
|
(191,633 |
) |
|
|
|
|
|
|
|||
Balance at |
|
|
|
$ |
7,534,798 |
|
|
$ |
(2,460,646 |
) |
|
$ |
5,074,152 |
|
|
|
214,278 |
|
|
$ |
35,164 |
|
Digital asset purchases |
|
(f) |
|
|
793,828 |
|
|
|
|
|
|
793,828 |
|
|
|
12,053 |
|
|
|
65,861 |
|
|
Digital asset impairment losses |
|
|
|
|
|
|
|
(180,090 |
) |
|
|
(180,090 |
) |
|
|
|
|
|
|
|||
Balance at |
|
|
|
$ |
8,328,626 |
|
|
$ |
(2,640,736 |
) |
|
$ |
5,687,890 |
|
|
|
226,331 |
|
|
$ |
36,798 |
|
* |
|
|
|
|
|
(a) |
|
In the first quarter of 2023, |
|
|
|
(b) |
|
In the second quarter of 2023, |
|
|
|
(c) |
|
In the third quarter of 2023, |
|
|
|
(d) |
|
In the fourth quarter of 2023, |
|
|
|
(e) |
|
In the first quarter of 2024, |
|
|
|
(f) |
|
In the second quarter of 2024, |
Excess Cash refers to cash in excess of the minimum Cash Assets that |
|
||||||||||||||||||||||||||||
DIGITAL ASSETS – ADDITIONAL INFORMATION |
||||||||||||||||||||||||||||
MARKET VALUE OF BITCOIN HOLDINGS |
||||||||||||||||||||||||||||
(unaudited) |
||||||||||||||||||||||||||||
|
||||||||||||||||||||||||||||
|
|
Approximate Number of Bitcoins Held at End of Quarter * |
|
|
|
|
|
Market Value of Bitcoin Held at End of Quarter Using Lowest Market Price (in thousands) (b) |
|
|
|
|
|
Market Value of Bitcoin Held at End of Quarter Using Highest Market Price (in thousands) (d) |
|
|
Market Price Per Bitcoin at End of Quarter (e) |
|
|
Market Value of Bitcoin Held at End of Quarter Using Ending Market Price (in thousands) (f) |
|
|||||||
|
|
|
132,500 |
|
|
$ |
15,460.00 |
|
|
$ |
2,048,450 |
|
|
$ |
21,478.80 |
|
|
$ |
2,845,941 |
|
|
$ |
16,556.32 |
|
|
$ |
2,193,712 |
|
|
|
|
140,000 |
|
|
$ |
16,490.00 |
|
|
$ |
2,308,600 |
|
|
$ |
29,190.04 |
|
|
$ |
4,086,606 |
|
|
$ |
28,468.44 |
|
|
$ |
3,985,582 |
|
|
|
|
152,333 |
|
|
$ |
24,750.00 |
|
|
$ |
3,770,242 |
|
|
$ |
31,443.67 |
|
|
$ |
4,789,909 |
|
|
$ |
30,361.51 |
|
|
$ |
4,625,060 |
|
|
|
|
158,245 |
|
|
$ |
24,900.00 |
|
|
$ |
3,940,301 |
|
|
$ |
31,862.21 |
|
|
$ |
5,042,035 |
|
|
$ |
27,030.47 |
|
|
$ |
4,277,437 |
|
|
|
|
189,150 |
|
|
$ |
26,521.32 |
|
|
$ |
5,016,508 |
|
|
$ |
45,000.00 |
|
|
$ |
8,511,750 |
|
|
$ |
42,531.41 |
|
|
$ |
8,044,816 |
|
|
|
|
214,278 |
|
|
$ |
38,501.00 |
|
|
$ |
8,249,917 |
|
|
$ |
73,835.57 |
|
|
$ |
15,821,338 |
|
|
$ |
71,028.14 |
|
|
$ |
15,219,768 |
|
|
|
|
226,331 |
|
|
$ |
56,500.00 |
|
|
$ |
12,787,702 |
|
|
$ |
72,777.00 |
|
|
$ |
16,471,691 |
|
|
$ |
61,926.69 |
|
|
$ |
14,015,930 |
|
* |
|
|
|
|
|
(a) |
|
The " |
|
|
|
(b) |
|
The "Market Value of Bitcoin Held at End of Quarter Using Lowest Market Price" represents a mathematical calculation consisting of the lowest market price for one bitcoin reported on the Coinbase exchange during the respective quarter multiplied by the number of bitcoins held by |
|
|
|
(c) |
|
The " |
|
|
|
(d) |
|
The "Market Value of Bitcoin Held at End of Quarter Using Highest Market Price" represents a mathematical calculation consisting of the highest market price for one bitcoin reported on the Coinbase exchange during the respective quarter multiplied by the number of bitcoins held by |
|
|
|
(e) |
|
The "Market Price Per Bitcoin at End of Quarter" represents the market price of one bitcoin on the Coinbase exchange at |
|
|
|
(f) |
|
The "Market Value of Bitcoin Held at End of Quarter Using Ending Market Price" represents a mathematical calculation consisting of the market price of one bitcoin on the Coinbase exchange at |
|
||
The amounts reported as “Market Value” in the above table represent only a mathematical calculation consisting of the price for one bitcoin reported on the Coinbase exchange (MicroStrategy’s principal market for bitcoin) in each scenario defined above multiplied by the number of bitcoins held by |
|
||||||||||||||||
RECONCILIATION OF GAAP TO NON-GAAP MEASURES |
||||||||||||||||
LOSS FROM OPERATIONS |
||||||||||||||||
(in thousands) |
||||||||||||||||
|
||||||||||||||||
|
|
Three Months Ended |
|
|
Six Months Ended |
|
||||||||||
|
|
|
|
|
|
|
||||||||||
|
|
2024 |
|
|
2023 |
|
|
2024 |
|
|
2023 |
|
||||
|
|
(unaudited) |
|
|
(unaudited) |
|
|
(unaudited) |
|
|
(unaudited) |
|
||||
Reconciliation of non-GAAP loss from operations: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Loss from operations |
|
$ |
(200,274 |
) |
|
$ |
(26,708 |
) |
|
$ |
(403,976 |
) |
|
$ |
(47,015 |
) |
Share-based compensation expense |
|
|
20,621 |
|
|
|
15,494 |
|
|
|
38,412 |
|
|
|
33,049 |
|
Non-GAAP loss from operations |
|
$ |
(179,653 |
) |
|
$ |
(11,214 |
) |
|
$ |
(365,564 |
) |
|
$ |
(13,966 |
) |
|
||||||||||||||||
RECONCILIATION OF GAAP TO NON-GAAP MEASURES |
||||||||||||||||
NET (LOSS) INCOME AND DILUTED (LOSS) EARNINGS PER SHARE |
||||||||||||||||
(in thousands, except per share data) |
||||||||||||||||
|
||||||||||||||||
|
|
Three Months Ended |
|
|
Six Months Ended |
|
||||||||||
|
|
|
|
|
|
|
||||||||||
|
|
2024 |
|
|
2023 |
|
|
2024 |
|
|
2023 |
|
||||
|
|
(unaudited) |
|
|
(unaudited) |
|
|
(unaudited) |
|
|
(unaudited) |
|
||||
Reconciliation of non-GAAP net (loss) income: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Net (loss) income |
|
$ |
(102,559 |
) |
|
$ |
22,243 |
|
|
$ |
(155,677 |
) |
|
$ |
483,436 |
|
Share-based compensation expense |
|
|
20,621 |
|
|
|
15,494 |
|
|
|
38,412 |
|
|
|
33,049 |
|
Interest expense arising from amortization of debt issuance costs |
|
|
3,842 |
|
|
|
2,190 |
|
|
|
6,399 |
|
|
|
4,400 |
|
Gain on debt extinguishment |
|
|
0 |
|
|
|
0 |
|
|
|
0 |
|
|
|
(44,686 |
) |
Income tax effects (1) |
|
|
(57,962 |
) |
|
|
(2,998 |
) |
|
|
(167,200 |
) |
|
|
5,768 |
|
Non-GAAP net (loss) income |
|
$ |
(136,058 |
) |
|
$ |
36,929 |
|
|
$ |
(278,066 |
) |
|
$ |
481,967 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Reconciliation of non-GAAP diluted (loss) earnings per share (2): |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Diluted (loss) earnings per share |
|
$ |
(5.74 |
) |
|
$ |
1.52 |
|
|
$ |
(8.88 |
) |
|
$ |
33.56 |
|
Share-based compensation expense (per diluted share) |
|
|
1.15 |
|
|
|
0.96 |
|
|
|
2.19 |
|
|
|
2.27 |
|
Interest expense arising from amortization of debt issuance costs (per diluted share) (3) |
|
|
0.22 |
|
|
|
0.03 |
|
|
|
0.37 |
|
|
|
0.06 |
|
Gain on debt extinguishment (per diluted share) |
|
|
0.00 |
|
|
|
0.00 |
|
|
|
0.00 |
|
|
|
(3.07 |
) |
Income tax effects (per diluted share) (3) |
|
|
(3.25 |
) |
|
|
(0.16 |
) |
|
|
(9.54 |
) |
|
|
0.46 |
|
Non-GAAP diluted (loss) earnings per share |
|
$ |
(7.62 |
) |
|
$ |
2.35 |
|
|
$ |
(15.86 |
) |
|
$ |
33.28 |
|
(1) |
|
Income tax effects reflect the net tax effects of share-based compensation, which includes tax benefits and expenses on exercises of stock options and vesting of share-settled restricted stock units, interest expense for amortization of debt issuance costs, and gain on debt extinguishment. |
|
|
|
(2) |
|
For reconciliation purposes, the non-GAAP diluted earnings (loss) per share calculations use the same weighted average shares outstanding as that used in the GAAP diluted earnings (loss) per share calculations for the same period. For example, in periods of GAAP net loss, otherwise dilutive potential shares of common stock from MicroStrategy’s share-based compensation arrangements and convertible notes are excluded from the GAAP diluted loss per share calculation as they would be antidilutive, and therefore are also excluded from the non-GAAP diluted earnings or loss per share calculation. |
|
|
|
(3) |
|
For the three and six months ended |
|
||||||||||||||||||||||||
RECONCILIATION OF GAAP TO NON-GAAP MEASURES |
||||||||||||||||||||||||
CONSTANT CURRENCY |
||||||||||||||||||||||||
(in thousands) |
||||||||||||||||||||||||
|
||||||||||||||||||||||||
|
|
Three Months Ended |
|
|||||||||||||||||||||
|
|
|
|
|||||||||||||||||||||
|
|
(unaudited) |
|
|||||||||||||||||||||
|
|
GAAP |
|
|
Foreign
|
|
|
Non-GAAP Constant Currency (2) |
|
|
GAAP |
|
|
GAAP % Change |
|
|
Non-GAAP Constant Currency %
|
|
||||||
|
|
2024 |
|
|
2024 |
|
|
2024 |
|
|
2023 |
|
|
2024 |
|
|
2024 |
|
||||||
Revenues |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Product licenses |
|
$ |
9,286 |
|
|
$ |
(20 |
) |
|
$ |
9,306 |
|
|
$ |
15,522 |
|
|
|
-40.2 |
% |
|
|
-40.0 |
% |
Subscription services |
|
|
24,080 |
|
|
|
(125 |
) |
|
|
24,205 |
|
|
|
19,878 |
|
|
|
21.1 |
% |
|
|
21.8 |
% |
Total product licenses and subscription services |
|
|
33,366 |
|
|
|
(145 |
) |
|
|
33,511 |
|
|
|
35,400 |
|
|
|
-5.7 |
% |
|
|
-5.3 |
% |
Product support |
|
|
61,740 |
|
|
|
(364 |
) |
|
|
62,104 |
|
|
|
66,081 |
|
|
|
-6.6 |
% |
|
|
-6.0 |
% |
Other services |
|
|
16,336 |
|
|
|
(146 |
) |
|
|
16,482 |
|
|
|
18,919 |
|
|
|
-13.7 |
% |
|
|
-12.9 |
% |
Total revenues |
|
|
111,442 |
|
|
|
(655 |
) |
|
|
112,097 |
|
|
|
120,400 |
|
|
|
-7.4 |
% |
|
|
-6.9 |
% |
|
|
Six Months Ended |
|
|||||||||||||||||||||
|
|
|
|
|||||||||||||||||||||
|
|
(unaudited) |
|
|||||||||||||||||||||
|
|
GAAP |
|
|
Foreign
|
|
|
Non-GAAP Constant Currency (2) |
|
|
GAAP |
|
|
GAAP % Change |
|
|
Non-GAAP Constant Currency %
|
|
||||||
|
|
2024 |
|
|
2024 |
|
|
2024 |
|
|
2023 |
|
|
2024 |
|
|
2024 |
|
||||||
Revenues |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Product licenses |
|
$ |
22,224 |
|
|
$ |
(102 |
) |
|
$ |
22,326 |
|
|
$ |
32,934 |
|
|
|
-32.5 |
% |
|
|
-32.2 |
% |
Subscription services |
|
|
47,046 |
|
|
|
(39 |
) |
|
|
47,085 |
|
|
|
38,688 |
|
|
|
21.6 |
% |
|
|
21.7 |
% |
Total product licenses and subscription services |
|
|
69,270 |
|
|
|
(141 |
) |
|
|
69,411 |
|
|
|
71,622 |
|
|
|
-3.3 |
% |
|
|
-3.1 |
% |
Product support |
|
|
124,425 |
|
|
|
(120 |
) |
|
|
124,545 |
|
|
|
131,562 |
|
|
|
-5.4 |
% |
|
|
-5.3 |
% |
Other services |
|
|
32,993 |
|
|
|
(88 |
) |
|
|
33,081 |
|
|
|
39,131 |
|
|
|
-15.7 |
% |
|
|
-15.5 |
% |
Total revenues |
|
|
226,688 |
|
|
|
(349 |
) |
|
|
227,037 |
|
|
|
242,315 |
|
|
|
-6.4 |
% |
|
|
-6.3 |
% |
(1) |
|
The “Foreign Currency Exchange Rate Impact” reflects the estimated impact of fluctuations in foreign currency exchange rates on international revenues. It shows the increase (decrease) in international revenues from the same period in the prior year, based on comparisons to the prior year quarterly average foreign currency exchange rates. “International revenues” refers to revenues from operations outside of |
|
|
|
(2) |
|
The “Non-GAAP Constant Currency” reflects the current period GAAP amount, less the Foreign Currency Exchange Rate Impact. |
|
|
|
(3) |
|
The “Non-GAAP Constant Currency % Change” reflects the percentage change between the current period Non-GAAP Constant Currency amount and the GAAP amount for the same period in the prior year. |
|
||||||||||||
DEFERRED REVENUE DETAIL |
||||||||||||
(in thousands) |
||||||||||||
|
||||||||||||
|
|
|
|
|
|
|
|
|
|
|||
|
|
2024 |
|
|
2023* |
|
|
2023 |
|
|||
|
|
(unaudited) |
|
|
|
|
|
(unaudited) |
|
|||
Current: |
|
|
|
|
|
|
||||||
Deferred product licenses revenue |
|
$ |
4,200 |
|
|
$ |
3,579 |
|
|
$ |
974 |
|
Deferred subscription services revenue |
|
|
69,566 |
|
|
|
65,512 |
|
|
|
49,898 |
|
Deferred product support revenue |
|
|
127,170 |
|
|
|
152,012 |
|
|
|
141,605 |
|
Deferred other services revenue |
|
|
3,901 |
|
|
|
7,059 |
|
|
|
3,340 |
|
Total current deferred revenue and advance payments |
|
$ |
204,837 |
|
|
$ |
228,162 |
|
|
$ |
195,817 |
|
|
|
|
|
|
|
|
|
|
||||
Non-current: |
|
|
|
|
|
|
|
|
|
|||
Deferred product licenses revenue |
|
$ |
0 |
|
|
$ |
0 |
|
|
$ |
2,493 |
|
Deferred subscription services revenue |
|
|
1,623 |
|
|
|
3,097 |
|
|
|
2,888 |
|
Deferred product support revenue |
|
|
3,974 |
|
|
|
4,984 |
|
|
|
5,340 |
|
Deferred other services revenue |
|
|
367 |
|
|
|
443 |
|
|
|
523 |
|
Total non-current deferred revenue and advance payments |
|
$ |
5,964 |
|
|
$ |
8,524 |
|
|
$ |
11,244 |
|
|
|
|
|
|
|
|
|
|
||||
Total current and non-current: |
|
|
|
|
|
|
|
|
|
|||
Deferred product licenses revenue |
|
$ |
4,200 |
|
|
$ |
3,579 |
|
|
$ |
3,467 |
|
Deferred subscription services revenue |
|
|
71,189 |
|
|
|
68,609 |
|
|
|
52,786 |
|
Deferred product support revenue |
|
|
131,144 |
|
|
|
156,996 |
|
|
|
146,945 |
|
Deferred other services revenue |
|
|
4,268 |
|
|
|
7,502 |
|
|
|
3,863 |
|
Total current and non-current deferred revenue and advance payments |
|
$ |
210,801 |
|
|
$ |
236,686 |
|
|
$ |
207,061 |
|
|
||||||||||||
* Derived from audited financial statements. |
|
||||||||||||||||||||||||
SEGMENT INFORMATION |
||||||||||||||||||||||||
(in thousands, unaudited) |
||||||||||||||||||||||||
|
||||||||||||||||||||||||
|
|
Three Months Ended |
|
|
Three Months Ended |
|
||||||||||||||||||
|
|
Software Business |
|
|
Corporate & Other |
|
|
Total Consolidated |
|
|
Software Business |
|
|
Corporate & Other |
|
|
Total Consolidated |
|
||||||
Total revenues |
|
$ |
111,442 |
|
|
|
|
|
$ |
111,442 |
|
|
$ |
120,400 |
|
|
|
|
|
$ |
120,400 |
|
||
Total cost of revenues |
|
|
30,935 |
|
|
|
|
|
|
30,935 |
|
|
|
27,121 |
|
|
|
|
|
|
27,121 |
|
||
Gross profit |
|
$ |
80,507 |
|
|
|
|
|
$ |
80,507 |
|
|
$ |
93,279 |
|
|
|
|
|
$ |
93,279 |
|
||
Total operating expenses |
|
|
99,236 |
|
|
|
181,545 |
|
|
|
280,781 |
|
|
|
95,521 |
|
|
|
24,466 |
|
|
|
119,987 |
|
Loss from operations |
|
$ |
(18,729 |
) |
|
$ |
(181,545 |
) |
|
$ |
(200,274 |
) |
|
$ |
(2,242 |
) |
|
$ |
(24,466 |
) |
|
$ |
(26,708 |
) |
|
|
Six Months Ended |
|
|
Six Months Ended |
|
||||||||||||||||||
|
|
Software Business |
|
|
Corporate & Other |
|
|
Total Consolidated |
|
|
Software Business |
|
|
Corporate & Other |
|
|
Total Consolidated |
|
||||||
Total revenues |
|
$ |
226,688 |
|
|
|
|
|
$ |
226,688 |
|
|
$ |
242,315 |
|
|
|
|
|
$ |
242,315 |
|
||
Total cost of revenues |
|
|
60,950 |
|
|
|
|
|
|
60,950 |
|
|
|
55,062 |
|
|
|
|
|
|
55,062 |
|
||
Gross profit |
|
$ |
165,738 |
|
|
|
|
|
$ |
165,738 |
|
|
$ |
187,253 |
|
|
|
|
|
$ |
187,253 |
|
||
Total operating expenses |
|
|
195,359 |
|
|
|
374,355 |
|
|
|
569,714 |
|
|
|
190,008 |
|
|
|
44,260 |
|
|
|
234,268 |
|
Loss from operations |
|
$ |
(29,621 |
) |
|
$ |
(374,355 |
) |
|
$ |
(403,976 |
) |
|
$ |
(2,755 |
) |
|
$ |
(44,260 |
) |
|
$ |
(47,015 |
) |
|
||||||||||||||||||||||||
|
View source version on businesswire.com: https://www.businesswire.com/news/home/20240801276948/en/
Investor Relations
ir@microstrategy.com
Source: