Business intelligence platform MicroStrategy has reiterated its commitment to its Bitcoin (BTC) investment strategy after posting its first quarterly profit since 2020.
The company, founded by Michael Saylor, went green in the first quarter of 2023 with earnings of $94 million, largely due to a one-time income tax benefit of $453.2 million.
In addition to tax benefits, the company had revenue of $121.9 million, up 2.2% from the same period last year.
Phong Lee, the company’s CEO, stated in the May 1 statement that MicroStrategy’s “conviction” in its Bitcoin (BTC) investment strategy is as “strong” as ever:
“Conviction in our Bitcoin strategy remains strong as the environment for digital assets continues to mature.”
“We remain cost disciplined while investing for growth, and we will continue our dual strategy of growing our business intelligence software business and acquiring Bitcoin for the future,” he added.
Lee also emphasized that his “core business” is unaffected by short-term price swings in BTC.
Saylor, who serves as MicroStrategy’s chairman, attributed the successful quarter to the firm execution of the company’s core business model and its Bitcoin investment thesis, which he called the “right strategy,” adding:
“So at the end of the day, it’s not easy to see what better strategy there could be. Therefore, we are strong advocates of a bitcoin strategy. And as you can see from this chart, simply acquiring and holding bitcoin in a prudent manner is a pretty good way to outperform the market.”
The bitcoin proponent predicted that investors will soon exit their positions in crypto assets that are “under scrutiny in the regulatory environment,” which in turn will “flow into bitcoin.”
Andrew Kang, MicroStrategy’s Chief Financial Officer, added that the company also managed to reduce its leverage by repaying its $161 million Bitcoin-backed loan from the now-collapsed Silverage Bank:
“By paying off the debt, we also released any Bitcoins that were pledged as collateral for the loan. This was an important and strategic transaction for us and our liability management goals.”
The business intelligence firm bought 7,500 BTC in two purchases on March 23 and April 5 for a total of $179 million in the first quarter, according to previous SEC filings.
MicroStrategy Bitcoin Accumulation by Quarter. Source: MicroStrategy
The company now holds 140,000 BTC, bought together at an average price of around $29,803.
The company’s turn to profit comes as BTC managed to surge 72% to around $28,300 in the first quarter.
Related: MicroStrategy stock price will more than double in 2023 in lockstep with Bitcoin
With BTC currently priced at $28,100, MicroStrategy is down around 5.7% on its Bitcoin investment.
However, the company was in the “green zone” for a period last month when BTC traded on March 15.
The software analytics firm began investing its cash reserves into BTC on March 5, 2021, when it bought 91,064 BTC — 65% of its total holdings today.
Saylor recently announced that MicroStrategy has integrated Bitcoin Lightning into his corporate email address.
The Bitcoin-savvy company is also in the process of developing a Bitcoin Layer 2 Lightning Network-based enterprise software-as-a-service tool.
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