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MicroStrategy CEO Michael Saylor is stepping down after bitcoin losses

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Yahoo Finance Live anchors discuss second-quarter earnings.

Video Transcript

BRAD SMITH: One conversation here for today, for sure, MicroStrategy, ticker symbol MSTR, moving this morning after news that founder and CEO Michael Saylor is stepping down to assume an executive chair role, so will still be with MicroStrategy, just in a different capacity. Taking a look at shares, they're moving higher by about 5.7%. The company had also reported earnings here, and we saw total revenues for the quarter come in at a decrease, actually, year-over-year of about 2.6%-- here taking a look at some of the actuals-- $122.1 million.

And we got even more insight from the company as well on where the actual cost basis for MicroStrategy's Bitcoin holdings. Of course, that is what's most notably talked about when it comes to Michael Saylor and how bullish he is within BTC and the broader cryptocurrency industry as well.

BRIAN SOZZI: When I saw this, my first reaction is, is there going to be some kind of split up of MicroStrategy, where Saylor takes some form of business using their cryptocurrencies and spins it out? Because now, essentially-- now that you have this structure, you're probably going to have a lot of investor focus on what they're supposed to be doing. Aren't they supposed to be a business intelligent business?

JULIE HYMAN: He has always maintained, though, that the two need to be together, that they complement each other. That's been what he has said to us before, and I imagine that's what he would continue to say. Listen, Saylor's, maybe not his day job, but his ongoing role has been as a Bitcoin maximalist and evangelist. So it makes sense that he would step into this executive chairman role.

That said, I have to admit I'm a little surprised to see the stock performing as well as it is because the underlying numbers were not great and because, for now, the Bitcoin holdings, the Bitcoin investment has not been a great investment. Again, he's always maintained it's a longer-term investment. It's something that is going to pay off over the long term. And he said he wants to hold the bitcoins forever, right.

So, you know, I don't know. Jefferies' analyst Brent Thill, friend of the show, notes that the company's continued subpar execution, he says "subscription revenue was the only line item to grow during the quarter." And he says, "it trades at a premium for an asset that undergoes its peers." Now clearly, it has traded at a premium because people have been willing to ascribe some premium to the Bitcoin holdings. But the more writedowns they take, maybe-- I mean, it's not changing today, necessarily, although the stock is down quite a lot this year.

BRAD SMITH: Yeah, absolutely. And if we were to take a look at Bitcoin here, even on the day, of course, Bitcoin out of some of the lowest points that we had seen over the course of 2022 thus far, but still well off of some of the highs and still trying to get it back to--

JULIE HYMAN: It's up today.

BRAD SMITH: --get back to some--

JULIE HYMAN: There you go.

BRAD SMITH: It's up today Hey, there you go.

JULIE HYMAN: So maybe MicroStrategy is just trading in line with Bitcoin today, and it doesn't have anything to do with anything else.

BRAD SMITH: Some type--

JULIE HYMAN: I don't know.

BRAD SMITH: Some type of correlation there, guys. Coming up on the other side of this short break, gaming's big comeback. We're going to discuss the latest earnings report from AMD and what it means for the broader gaming space.