MicroStrategy is the latest new-age financial firm to implode. The company, which had sold itself to Wall Street as a major growth story, posted a year-over-year decline in revenue of 3% to $122 million. To make matters worse, the company lost $918 million in the quarter. Almost all the red ink was due to a drop in the value of cryptocurrency held by MicroStrategy.
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In another troubling turn of events, Michael Saylor left his job as chief executive to become executive board chair. Stunningly, President Phong Le became CEO. He was part of the management team that made decisions that destroyed a huge amount of the company’s market capitalization.
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Saylor commented:
As Executive Chairman I will be able to focus more on our bitcoin acquisition strategy and related bitcoin advocacy initiatives, while Phong will be empowered as CEO to manage overall corporate operations.
This is after Saylor entirely missed the change in a market in which he claims to be among the world’s experts.
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If there is only one reason for the board to push Saylor out, it is the performance of the company’s stock. It is down 56% in the past year. There is almost no precedent for the leader of a public company to keep a position at the head of the company under these circumstances.
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One problem with the board is that many members have been in their positions for years. Saylor may not be forced to leave MicroStrategy because of that.
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