MicroStrategy co-founder Michael Saylor has relinquished his position as chief executive after reporting a $1 billion loss on the company’s Bitcoin holdings.
Saylor will assume the newly created position of executive chairman and will continue to serve as chairman of the board. Focusing primarily on innovation and long-term corporate strategy, Saylor will continue to conduct the Company’s Bitcoin acquisition strategy as head of the Board’s Investments Committee.
“MicroStrategy’s original strategy and consulting business needs full-time attention,” said Henry Elder, head of decentralized finance at Wave Financial. “Now Michael can focus on what he does best, promoting Bitcoin, and the company can focus on making more money to buy more Bitcoin. They are basically doubling down.”
The chief executive role will be filled by MicroStrategy President Phong Le, who joined the firm in 2015 and has previously served as chief financial officer and chief operating officer.
The Virginia-based business intelligence firm, co-founded by Saylor in 1989, also registered 450,000 shares with the Securities and Exchange Commission.
“I believe that splitting the roles of Chairman and CEO will enable us to better pursue our two corporate strategies of acquiring and holding bitcoin and growing our enterprise analytics software business,” Saylor said in a press release.
“As Executive Chairman, I will be able to focus more on our bitcoin acquisition strategy and related bitcoin advocacy initiatives, while Phong will be empowered as CEO to manage overall corporate operations.”
MicroStrategy loses $1B on Bitcoin holding
The transition comes as MicroStrategy announced its financial results for the second quarter of this fiscal year, or the three-month period ended June 30. The decline in the value of the Bitcoin it holds led to a $917.8 million impairment charge.
By the end of the quarter, the carrying value of the company’s 129,699 Bitcoin had shrunk to $1.988 billion, the company said, reflecting the cumulative impairment loss of $1.989 billion.
Meanwhile, revenue came in just shy analysts’ expectations of $123.25 million to just $122.1 million. The $299.3 million loss booked in the same quarter of last year is a mere fraction of the net quarterly loss of $1.062 billion, almost exactly twice the company’s revenue over the last 12 months.
Earlier, Saylor had made remarks clarifying the company’s Bitcoin strategy over fears of a margin call.