Bitcoin News Today: MicroStrategy's Bitcoin Windfall Boosts Profits, But Stock Plummets as Market Doubts Long-Term Bet

MicroStrategy (MSTR), the world's largest corporate holder of Bitcoin, reported a third-quarter net profit of $2.8 billion on October 30, driven by gains from its $68 billion Bitcoin treasury. Despite the record earnings, the stock has plummeted 44% from its July peak, raising concerns among investors as the company ramps up efforts to secure funding in international markets, according to Lookonchain.

The firm's Q3 results included $8.42 in diluted earnings per share, surpassing analyst expectations, according to Decrypt. Its Bitcoin holdings—640,808 coins valued at $70.9 billion—generated $12.9 billion in gains year-to-date, reflecting a 26% return on the asset, per Investor Empires. CEO Phong Le emphasized during a conference call that the company is "building its digital loan issuance infrastructure internationally" to become a leading global loan issuer, as reported by BitcoinSistemi.

However, the stock's 44% decline since July has eroded the premium it once commanded over its Bitcoin holdings. MSTR shares closed at $254.57 on October 30, far below the $400 peak seen in July, according to Lookonchain. The drop has been attributed to waning volatility in Bitcoin and macroeconomic uncertainties, with traders on prediction markets assigning only an 18% chance that the firm will beat earnings expectations in future reports, according to Yahoo Finance.

MicroStrategy's aggressive Bitcoin accumulation has slowed in recent weeks as it pivots to preferred stock and international capital markets. The company spent $43.4 million to purchase 390 Bitcoin in late October, its largest buy since September, according to Yahoo Finance, while also launching preferred shares like STRC and STRD to fund further acquisitions. These instruments, which include quarterly dividend payments, have drawn mixed reactions, with some investors criticizing the dilutive impact on common shareholders, per Lookonchain.

Michael Saylor, the company's co-founder, remains bullish on Bitcoin despite the market turmoil. He reiterated a $150,000 price target for year-end 2025, citing institutional adoption and a "21% rally" in Bitcoin's price as catalysts, according to Investor Empires. Saylor also highlighted the potential for Bitcoin-backed credit markets to offer higher returns than traditional debt, a vision that underpins MicroStrategy's long-term strategy, per BitcoinSistemi.

The company's heavy reliance on Bitcoin has drawn regulatory scrutiny, with S&P Global downgrading MSTR to a junk rating of B- in October. The agency cited liquidity risks, noting that MicroStrategy must pay $640 million annually in preferred stock dividends and faces $5 billion in convertible bonds maturing by 2028, according to GuruFocus. S&P warned that a sharp drop in Bitcoin prices could force the firm to sell its holdings at a discount to meet obligations.

As the firm navigates these challenges, it is exploring an ETF backed by preferred stock and expanding its capital-raising efforts beyond U.S. markets, according to Lookonchain. With Bitcoin trading near $115,000 and the company's treasury valued at $73.7 billion, per GuruFocus, MicroStrategy's strategy remains a high-stakes bet on the cryptocurrency's long-term potential.