PANews reported on December 22 that according to Barrons, MicroStrategy Chairman Michael Saylor did not make it clear in a recent interview whether the company might be included in the S&P 500, but he said that given the optimistic view on Bitcoin, MicroStrategy may report billions of dollars in quarterly net income next year due to the growth in the value of Bitcoin holdings. Changes in accounting rules that will take effect in 2025 may enable MicroStrategy to meet the profit requirements to join the S&P 500.
It is reported that MicroStrategy's traditional software business (its main business before it began to buy a large amount of Bitcoin in 2020) is small in scale and may be valued at only about US$1 billion. In addition, the business is in a loss-making state according to GAAP (Generally Accepted Accounting Principles in the United States), which alone is difficult to meet the requirements for inclusion in the S&P 500 index. The accounting rules that will take effect will adjust the value of the company's Bitcoin holdings from the current low valuation to the fair market value, and may bring significant net income growth when the price of Bitcoin rises. However, the S&P Global Index Committee decides on the members of the S&P 500 Index by invitation, reviewing profitability, market value and other factors.
