Please ensure Javascript is enabled for purposes of website accessibility
Free Article Join Over 1 Million Premium Members And Get More In-Depth Stock Guidance and Research

Why MicroStrategy Stock Dropped 10.5% on Monday

By Rich Smith - Jul 8, 2019 at 3:22PM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Two executives resign. Whether they jumped or were pushed may not even matter.

What happened

Shares of business-analytics software maker MicroStrategy ( MSTR -5.47% ) were down 10.5% as of 2:45 p.m. today, apparently in reaction to a Securities and Exchange Commission filing by the company.

This morning, MicroStrategy notified the SEC that on July 1, its senior executive vice president for worldwide sales Kevin Norlin and its senior executive vice president for worldwide services Stephen H. Holdridge -- both members of the company's seven-member executive team  -- resigned from the company.

Businessman carrying a box and leaving office

Image source: Getty Images.

So what

No further information on the resignations or the executives' reasons for resigning was provided, but investors seem to be assuming the worst.

MicroStrategy did note that Phong Le, the company's COO and CFO, will be filling the gap left by the two departing executives by taking over both their duties -- as well as remaining COO. Because one man can only wear so many hats, MicroStrategy will be seeking a new CFO.

Now what

This isn't a great time for MicroStrategy to be stuck without a CFO. Sales are falling, and there was a loss last quarter. In February, the company warned that it has discovered "material weaknesses in our internal controls." It added that it is "implementing remedial measures," and that "management may need to devote significant resources to improving internal controls."

No wonder investors are nervous.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis – even one of our own – helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

MicroStrategy Incorporated Stock Quote
MicroStrategy Incorporated
MSTR
$596.47 (-5.47%) $-34.52

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning service.

Stock Advisor Returns
624%
 
S&P 500 Returns
140%

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 12/07/2021.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Our Most Popular Articles

Premium Investing Services

Invest better with the Motley Fool. Get stock recommendations, portfolio guidance, and more from the Motley Fool's premium services.