Stock price rising slower than MicroStrategy, shareholders suggest Microsoft diversify investments by incorporating Bitcoin

Tech giant Microsoft's annual shareholders meeting is set to take place on December 10th, according to its 2024 Annual Shareholder Meeting Proxy Statement submitted to the U.S. Securities and Exchange Commission (SEC). The document reveals that Microsoft has evaluated incorporating Bitcoin into its corporate financial investments, but the board of directors recommends against it.

Using MicroStrategy as an Example, Urging Microsoft to Consider Diversifying Investments in Bitcoin

The National Center for Public Policy Research (NCPPR) has proposed an evaluation of diversifying Bitcoin, arguing that during periods of persistent and rampant currency inflation, assessing a company's financial condition depends not only on its business operations but also on its ability to maintain business profits. Companies must not only strive to increase profits but also work to protect these profits from depreciation in order to maximize shareholder value.

As of March 31, 2024, Microsoft Corporation had $484 billion in total assets, with most of it being just above inflation U.S. government bonds and corporate bonds. NCPPR suggested that Microsoft should consider investing in assets that appreciate more than bonds to achieve asset balance sheet diversification, even if these assets have greater short-term volatility.

NCPPR also mentioned another tech company, MicroStrategy, stating that MicroStrategy's stock performance this year outperformed Microsoft's stock by 313%. Institutional and corporate adoption of Bitcoin is becoming increasingly common, and Microsoft's second-largest shareholder, BlackRock, is also offering a Bitcoin ETF to its clients.

Microsoft States Bitcoin is Too Unstable and Rejects the Proposal

According to Microsoft's documents, the company's global financial and investment services team has carefully evaluated various investment assets to provide funding for Microsoft's ongoing operations, including assets expected to provide diversification and inflation protection and mitigate the risk of significant economic losses from rising interest rates. Past evaluations have included Bitcoin and other cryptocurrencies in their considerations, and Microsoft will continue to monitor trends and developments related to cryptocurrencies to provide information for future decision-making.

Volatility is one of the considerations in evaluating corporate financial investments in cryptocurrencies, requiring stable and predictable investments to ensure the company's liquidity and operating funds.

Microsoft has robust and appropriate processes in place to manage its corporate finances and diversify them to achieve long-term shareholder interests. The board believes the proposal is "unnecessary." However, shareholders can still choose to support it through voting at the shareholder meeting on December 10.

Michael Saylor Calls Out Microsoft CEO

MicroStrategy founder Michael Saylor also chimed in, calling out Microsoft CEO Satya Nadella:

If you want to earn the next trillion dollars for Microsoft shareholders, give me a call.