Strategy's Cash Burn Rate Could Lead to Depletion Within 1.5 Quarters

The cash burn of Bitcoin-holding company Strategy is ongoing. Although recent quarterly expenditures have decreased, it is analyzed that the remaining cash will be depleted in about 1.5 quarters if the average rate of the past four quarters is maintained. The free cash flow (FCF) for the third quarter ending September 30 was minus $584 million. Third-quarter revenue was $125 million, and the cash flow from operating activities was plus $4.42 million, resulting in a deficit in free cash flow due to capital expenditures from Bitcoin purchases. The cash burn in the third quarter was 465.7% of revenue, down from 3861% in the same period last year. At the end of September, the cash and short-term investment assets held were $5.9 billion, while liabilities amounted to $6.78 billion, exceeding the cash holdings. Strategy has reported a 117% increase in the number of shares outstanding over the past two years and has raised a total of $21.2 billion this year. Management explained that the remaining cash could cover interest and dividend payments, as well as funds needed for Bitcoin financial strategies. The company's Bitcoin holdings amount to 848,517, and third-quarter revenue decreased by 2.5% compared to the same period last year.

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