The company’s efforts to raise capital may be stalled due to market turmoil, as it did not increase its bitcoin (BTC) assets last week.
Moreover, it anticipates reporting a net loss for the first quarter, primarily attributed to a significant unrealized loss of $5.91 billion on its bitcoin investments. This projection is outlined in a recent filing. The adjustments in accounting standards now require that cryptocurrency assets be valued at market prices. A projected tax benefit of $1.69 billion is expected to help mitigate some of the loss.
During the quarter, the firm raised a total of $7.69 billion, with $4.4 billion sourced from common stock sales and the remainder from preferred stock issuance. Most, if not all, of those funds went towards acquiring bitcoin at prices substantially higher than the current valuation of $77,000.
In fact, the average purchase price for its 528,185 BTC has increased to nearly $67,500, indicating the company is currently up only about 14% on its holdings.
Shares of the company dropped 9% in early trading on Monday, reflecting a 10% decrease year-to-date, although they remain up 77% compared to the previous year.
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