MicroStrategy Incorporated
08-04-08

MicroStrategy Announces Second Quarter 2008 Financial Results

Product Support and Other Services Revenues Increase 19% and Second Quarter Revenue from Continuing Operations Up 14%, Year-Over-Year

MCLEAN, Va., Aug 04, 2008 /PRNewswire-FirstCall via COMTEX News Network/ -- MicroStrategy(R) Incorporated (Nasdaq: MSTR), a leading worldwide provider of business intelligence software, today announced financial results for the three-month period ended June 30, 2008 (the second quarter of its 2008 fiscal year).

Second quarter 2008 revenue from continuing operations was $88.9 million versus $78.1 million for the second quarter of 2007, a 14% increase. This marked the twenty-second consecutive quarter of year-over-year revenue growth. Product licenses revenues for the second quarter of 2008 were $21.1 million versus $21.7 million for the second quarter of 2007, a 3% decrease. Product support and other services revenues for MicroStrategy's core business intelligence business in the second quarter of 2008 were $65.1 million versus $54.8 million for the second quarter of 2007, a 19% increase. In order to focus its resources on its core business intelligence software and services business, the Company plans to sell its Alarm.com business. Accordingly, financial results for Alarm.com are classified in the Company's financial results as discontinued operations. The Company continues to explore strategic alternatives for its Angel.com business unit but, in light of recent growth in that business and changes in market conditions, the Company is no longer able to conclude that a sale of Angel.com is probable in the near term and has therefore reclassified Angel.com's financial results so that they are reflected in the Company's continuing operations.

Operating expenses from continuing operations for the second quarter of 2008 were $57.7 million versus $47.2 million for the second quarter of 2007, a 22% increase. The increase in second quarter operating expenses was primarily due to an increase in the worldwide employee headcount and related expenses of the Company's core business intelligence business. During the second quarter of 2008, MicroStrategy capitalized $2.9 million in software development costs. Consolidated income from continuing operations for the second quarter of 2008 was $15.1 million, or 17% of revenue, versus $18.2 million, or 23% of revenue, for the second quarter of 2007. Net income for the second quarter of 2008 was $8.1 million, or $0.66 per share on a diluted basis, compared to $11.6 million, or $0.90 per share on a diluted basis, for the second quarter of 2007.

"The second quarter of 2008 presented a challenging macro economic environment for businesses, government agencies and consumers around the world," said Arthur S. Locke, III, MicroStrategy's Executive Vice President, Finance & Chief Financial Officer. "In this environment, our global team achieved product licenses revenues above $21 million while increasing our product support and services revenues by 19%. During these times, we know that our software can be more valuable than ever to our customers, and we are committed to providing high quality products and services to help ensure our customer applications are a success."

For the second quarter of 2008, MicroStrategy's effective tax rate on income from continuing operations was 49.4%, compared to 39.6% in the second quarter of 2007. The increase in the effective tax rate was primarily caused by an adjustment to the Company's deferred tax asset for state net operating losses and, to a lesser extent, net losses in certain foreign subsidiaries for which the Company is not currently able to recognize a tax benefit from those losses for financial reporting purposes.

During the second quarter of 2008, MicroStrategy repurchased 39,208 shares of its class A common stock for $3.0 million at an average price per share of $77.05, including broker commissions. As of June 30, 2008, MicroStrategy had cash and cash equivalents of approximately $119.6 million. As of June 30, 2008, MicroStrategy had 9,114,111 shares of class A common stock and 2,770,244 shares of class B common stock outstanding.

New Customers and New Deals with Existing Customers in Q2 2008 Included:

Adobe Systems Incorporated; Alticor; Booz, Allen & Hamilton Inc.; Capital Group Companies; Centers for Medicare & Medicaid Services; Comcast Cable Communication Management LLC; Con-way Enterprise Services, Inc.; David's Bridal; Department of the Navy; DHL; Family Dollar Store; Godiva Chocolatier, Inc.; Herbalife International of America, Inc.; Interstate Batteries; KeySpan Corporate Services LLC; McAfee, Inc.; Meredith Corporation; Micro Electronics, Inc.; Monaco Coach Corporation; Netflix; Northwest Evaluation Association; Nygard International; PPL Services Corporation; Reitmans Canada Limited; Ross Stores, Inc.; Starwood Hotels & Resorts, Inc.; The First American Corporation; U.S. House of Representatives; Unisource Worldwide; UNISYS Corporation; US Postal Service; VHA Inc.; and Wilton Products, Inc.

Examples of Customer Deals from Q2 2008:

David's Bridal

With more than 50 years of bridal experience, David's Bridal is the largest bridal retailer in the country with more than 280 locations nationwide. David's Bridal uses the MicroStrategy BI Platform to support key reporting and analysis needs for the entire organization, from store managers all the way up to the CEO.

Family Dollar Store

Family Dollar is one of the fastest growing discount store chains in the United States with stores in 44 states. Family Dollar has expanded its use of MicroStrategy to generate sales and inventory reports for greater insight into what products are selling at its 6,500 stores. Family Dollar selected MicroStrategy based on its intuitive user interface and proven scalability in large data warehousing environments.

McAfee, Inc.

McAfee, Inc., the world's largest dedicated security technology company, has selected MicroStrategy Dynamic Enterprise Dashboards(TM) because of its scalability to handle large volumes of data and ease-of-use.

Wilton Products, Inc.

Wilton Products, Inc. has been using MicroStrategy's Business Intelligence Platform for five years and it recently expanded access to hundreds of employees. Wilton's management and key personnel rely on MicroStrategy to obtain insight into multiple business areas, including finance and accounting, inventory, customer service, sales administration, and product development. Wilton uses MicroStrategy software for real time sales reporting on 18,000 SKUs.

Latest Release of MicroStrategy 8(TM) Software

The latest release of MicroStrategy 8 software was made generally available on July 18, 2008. The new release offers enhancements to MicroStrategy Mobile(TM), MicroStrategy Integrity Manager(TM), and integration with SAP BI. In addition, MicroStrategy now offers interactive reporting and analysis on the Apple(R) iPhone(TM).

The new MicroStrategy 8 release offers a broad range of user-friendly features to MicroStrategy Mobile. MicroStrategy Mobile users can now access a host of new data views for dashboards and reports on their BlackBerry(R) smartphones. Users can reformat reports and save the formatting changes to share with other mobile users. In addition, reports can be displayed incrementally on the BlackBerry, which gives users greater speed in viewing exceptionally large reports.

MicroStrategy Integrity Manager is used to automatically detect inconsistencies and inaccuracies in reports and dashboards. In the latest release, enhancements to Integrity Manager include highlighting specific inconsistencies found in SQL generation, grid reports, graphs, dashboards, and Excel(R) reports. Additionally, IT personnel can now compare performance statistics for every report or dashboard run, including average, minimum, and maximum report execution times, and compare the variances to baseline statistics.

The latest version of MicroStrategy 8 software provides deeper integration with SAP BI to help organizations achieve faster time-to-value for their BI applications. MicroStrategy customers can further leverage their existing SAP investments with improved capabilities to design, publish, administer, and maintain their SAP reports. MicroStrategy now offers enhanced reuse of SAP BI objects that accelerate SAP report development, enabling higher-quality development in less time.

As part of this new release, MicroStrategy offers interactive reporting and analysis directly on the iPhone. iPhone users can view detailed operational reports, business charts and graphs, and user-friendly dashboards featuring key performance indicators (KPIs). With the iPhone touchscreen interface, users can interact with MicroStrategy reports and dashboards by intuitively sorting, pivoting, filtering, and drilling for greater insights. iPhone users can scroll through report content and magnify specific areas of a report or dashboard. MicroStrategy reports and dashboards do not need to be reformatted for viewing on the iPhone, giving users easy access to the same important information that they see on their desktop computers. To see MicroStrategy's BI application on the iPhone, visit http://www.microstrategy.com/iPhoneDemo.

MicroStrategy Celebrates 10-Year Anniversary as Public Company

MicroStrategy celebrated its 10-year anniversary as a public company on June 11, 2008. MicroStrategy Chairman and CEO, Michael Saylor, rang the Opening Bell at NASDAQ to commemorate the occasion. MicroStrategy's annual revenues have grown from $96 million in 1998 to $351 million in 2007 and the number of employees has increased from 907 to 1,582. Today, the Company has direct operations in more than 20 countries. MicroStrategy's technology and leadership have earned many accolades over the years, including recent recognition in Forbes 200 Best Small Companies in America list and a position in the 'Leaders' Quadrant of Gartner's 2008 Magic Quadrant for Business Intelligence Platforms Report.

Industry Awards

MicroStrategy customer, Guy Carpenter & Company, LLC, received the 2008 Best Practices Award from The Data Warehousing Institute (TDWI) for its online risk management platform, i-aXs(R). Guy Carpenter uses MicroStrategy's business intelligence software, along with mapping technology, to provide its insurance company clients with a highly visual and intuitive display of natural or manmade event data. TDWI's Best Practices Awards program is designed to identify and honor companies that have demonstrated excellence in developing, deploying, and maintaining BI and Data Warehouse (DW) applications.

Ahold, a long-time MicroStrategy customer, received the top Business Intelligence Award at the BI-Congress in the Netherlands. Albert Heijn, a supermarket division of Ahold, was named 'the smartest organization in the Netherlands' for its enterprise-wide business intelligence environment. Netherlands-based Ahold uses MicroStrategy to conduct sales and customer analyses at its Albert Heijn supermarkets and other Ahold holdings in Europe and the United States. In selecting the award winner, more than 120 companies were researched on 60 different topics considered key elements in creating an intelligent organization.

MicroStrategy Events

MicroStrategy held its Business Intelligence Symposium in New York City on July 22-23, 2008. The Symposium offered a broad range of educational sessions and customer presentations featuring best practices in business intelligence. Some of the companies that presented at the Symposium included AutoTrader.com, Con-way Freight, Corporate Express, GUESS?, Inc., Guy Carpenter, H&R Block Financial Advisors, and VHA.

In conjunction with the New York Symposium, MicroStrategy hosted two half- day industry-specific events: the Financial Services Industry Forum and the Retail Industry Forum. These programs brought together industry representatives to participate in roundtable discussions on relevant topics and share strategies for using business intelligence to solve industry challenges.

On July 30, 2008, MicroStrategy hosted a one-hour webcast, "Strategies for Optimizing Your Business Intelligence Experience." The webcast featured Nigel Pendse, leading industry analyst and author of The BI Survey and The OLAP Survey, who outlined BI optimization strategies based on his analysis of more than 1,800 companies' business intelligence experiences. Herbalife, a MicroStrategy customer, also shared success strategies and lessons learned in business intelligence.

MicroStrategy World 2009 will be held January 13-16, 2009 at the Wynn Las Vegas in Las Vegas, Nevada. The conference will feature more than 100 educational sessions, dozens of customer speakers from industry-leading organizations, and an exhibit hall showcasing MicroStrategy partners. MicroStrategy World 2009 will also include an update on the Company's latest technology advances, insightful keynote presentations, and networking opportunities.

About MicroStrategy Incorporated

Founded in 1989, MicroStrategy is a global leader in business intelligence (BI) technology. MicroStrategy provides integrated reporting, analysis, and monitoring software that helps leading organizations worldwide make better business decisions every day. Companies choose MicroStrategy for its advanced technical capabilities, sophisticated analytics, and superior data and user scalability. More information about MicroStrategy (Nasdaq: MSTR) is available at www.microstrategy.com.

MicroStrategy, MicroStrategy 8, MicroStrategy Business Intelligence Platform, MicroStrategy Dynamic Enterprise Dashboards, MicroStrategy Mobile, and MicroStrategy Integrity Manager are either trademarks or registered trademarks of MicroStrategy Incorporated in the United States and certain other countries. Other product and company names mentioned herein may be the trademarks of their respective owners.

This press release may include statements that may constitute "forward- looking statements," including estimates of future business prospects or financial results and statements containing the words "believe," "estimate," "project," "expect" or similar expressions. Forward-looking statements inherently involve risks and uncertainties that could cause actual results of MicroStrategy Incorporated and its subsidiaries (collectively, the "Company") to differ materially from the forward-looking statements. Factors that could contribute to such differences include: the ability of the Company to implement and achieve widespread customer acceptance of its MicroStrategy 8 software on a timely basis; the Company's ability to recognize deferred revenue through delivery of products or satisfactory performance of services; continued acceptance of the Company's products in the marketplace; the timing of significant orders; delays in the Company's ability to develop or ship new products; market acceptance of new products; the Company's ability to effect the sale of its Alarm.com business on acceptable terms, or at all; competitive factors; general economic conditions; currency fluctuations; and other risks detailed in the Company's registration statements and periodic reports filed with the Securities and Exchange Commission. By making these forward-looking statements, the Company undertakes no obligation to update these statements for revisions or changes after the date of this release.

    Contact:
    MicroStrategy Incorporated
    Investor Relations
    ir@microstrategy.com
    (703) 848-8600



                          MICROSTRATEGY INCORPORATED
                    CONSOLIDATED STATEMENTS OF OPERATIONS
                    (in thousands, except per share data)

                                  Three Months Ended      Six Months Ended
                                       June 30,               June 30,
                                  2008          2007     2008          2007
                               (unaudited)  (unaudited)(unaudited) (unaudited)
    Revenues
    Product licenses             $21,052       $21,699  $43,179       $38,398
    Product support and other
     services                     67,804        56,353  131,581       110,517
      Total revenues              88,856        78,052  174,760       148,915

    Cost of Revenues
    Product licenses                 461           854    1,020         1,443
    Product support and other
     services                     15,648        11,771   29,594        23,141
      Total cost of revenues      16,109        12,625   30,614        24,584

    Gross profit                  72,747        65,427  144,146       124,331

    Operating Expenses
    Sales and marketing           34,484        26,096   64,172        50,679
    Research and development       8,203         9,207   18,527        15,847
    General and administrative    15,001        11,887   32,311        25,006
      Total operating expenses    57,688        47,190  115,010        91,532

    Income from continuing
     operations before
     financing and other income
     and income taxes             15,059        18,237   29,136        32,799

    Financing and Other Income
    Interest income, net             660           875    1,458         1,855
    Other (expense) income, net     (102)          (11)    (963)           37
      Total financing and other
       income (expense)              558           864      495         1,892

    Income from continuing
     operations before income
     taxes                        15,617        19,101   29,631        34,691
      Provision for income taxes   7,719         7,565   12,772        13,358
    Income from continuing
     operations                    7,898        11,536   16,859        21,333
      Income (loss) from
       discontinued operations,
       net of tax provision
       ($197 and $54 for the
       three months ended,
       respectively, and $123
       and $100 for the six
       months ended,
       respectively                  228            77     (435)          125
    Net Income                    $8,126       $11,613  $16,424       $21,458

    Basic earnings (loss) per
     share (1):
      From continuing operations   $0.66         $0.93    $1.42         $1.71
      From discontinued
       operations                  $0.02         $0.01   $(0.04)        $0.01
        Basic earnings per share   $0.68         $0.94    $1.38         $1.72
    Weighted average shares
     outstanding used in
     computing basic earnings
     per share                    11,870        12,404   11,897        12,484

    Diluted earnings (loss) per
     share (1):
      From continuing operations   $0.64         $0.89    $1.36         $1.63
      From discontinued
       operations                  $0.02         $0.01   $(0.03)        $0.01
      Diluted earnings per
       share                       $0.66         $0.90    $1.33         $1.64
    Weighted average shares
     outstanding used in
     computing diluted
     earnings per share           12,324        12,940   12,351        13,048

    (1) Basic and fully diluted earnings per share for class A and class B
        common stock are the same



                          MICROSTRATEGY INCORPORATED
                    CONSOLIDATED STATEMENTS OF OPERATIONS
                    (in thousands, except per share data)
                                 (unaudited)

                       Core BI Business     Angel.com       Consolidated
                      Three Months Ended Three Months Ended Three Months Ended
                           June 30,           June 30,         June 30,
                        2008      2007    2008     2007      2008     2007

    Revenues
    Product licenses $21,052   $21,699      $-       $-   $21,052  $21,699
    Product support
     and other
     services         65,064    54,771       -        -    65,064   54,771
    Angel.com
     telephony
     services              -         -   2,740    1,582     2,740    1,582
      Total revenues  86,116    76,470   2,740    1,582    88,856   78,052

    Cost of Revenues
    Product licenses     461       854       -        -       461      854
    Product support
     and services
     revenues         15,208    11,278       -        -    15,208   11,278
    Angel.com
     telephony
     services              -         -     440      493       440      493
      Total cost of
       revenues       15,669    12,132     440      493    16,109   12,625
    Gross profit      70,447    64,338   2,300    1,089    72,747   65,427

    Operating Expenses
    Sales and
     marketing        32,063    24,587   2,421    1,509    34,484   26,096
    Research and
     development       7,259     8,507     944      700     8,203    9,207
    General and
     administrative   14,911    11,887      90(a)   -(a)   15,001   11,887
      Total
       operating
       expenses       54,233    44,981   3,455    2,209    57,688   47,190
    Income (loss)
     from continuing
     operations       16,214    19,357  (1,155)  (1,120)   15,059   18,237

    Financing and
     Other Income
    Interest income,
     net                 660       875       -        -       660      875
    Other expense,
     net                (102)      (11)      -        -      (102)     (11)
      Total
       financing and
       other income      558       864       -        -       558      864
    Income (loss)
     from continuing
     operations
     before income
     taxes           $16,772   $20,221 $(1,155) $(1,120)  $15,617  $19,101
      Provision for
       income taxes                                         7,719    7,565
    Income from
     continuing
     operations                                             7,898   11,536
      Income from
       discontinued
       operations,
       net of tax                                             228       77
    Net income                                             $8,126  $11,613

    Basic earnings per share:
      From continuing operations                           $ 0.66    $0.93
      From discontinued operations                         $ 0.02    $0.01
        Basic earnings per share                           $ 0.68    $0.94

    Diluted earnings per share
      From continuing operations                           $ 0.64    $0.89
      From discontinued operations                         $ 0.02    $0.01
        Diluted earnings per share                         $ 0.66    $0.90

      Basic weighted average shares outstanding            11,870   12,404
      Diluted weighted average shares outstanding          12,324   12,940


    (a)  An insignificant amount of general and administrative services is
         provided to the Angel.com business unit by MicroStrategy's core
         business operations.



                          MICROSTRATEGY INCORPORATED
                    CONSOLIDATED STATEMENTS OF OPERATIONS
                    (in thousands, except per share data)
                                 (unaudited)

                      Core BI Business     Angel.com        Consolidated
                      Six Months Ended  Six Months Ended  Six Months Ended
                          June 30,           June 30,          June 30,
                        2008      2007    2008     2007      2008     2007


    Revenues
    Product licenses $43,179   $38,398      $-       $-   $43,179  $38,398
    Product support
     and other
     services        126,476   107,425       -        -   126,476  107,425
    Angel.com
     telephony
     services              -         -   5,105    3,092     5,105    3,092
      Total revenues 169,655   145,823   5,105    3,092   174,760  148,915

    Cost of Revenues
    Product licenses   1,020     1,443       -        -     1,020    1,443
    Product support
     and services
     revenues         28,694    22,205       -        -    28,694   22,205
    Angel.com
     telephony
     services              -         -     900      936       900      936
      Total cost
       of revenues    29,714    23,648     900      936    30,614   24,584
    Gross profit     139,941   122,175   4,205    2,156   144,146  124,331

    Operating Expenses
    Sales and
     marketing        60,195    47,752   3,977    2,927    64,172   50,679
    Research and
     development      16,995    14,433   1,532    1,414    18,527   15,847
    General and
     administrative   32,161    25,006     150(a)     -(a) 32,311   25,006
      Total
       operating
       expenses      109,351    87,191   5,659    4,341   115,010   91,532
    Income (loss)
     from continuing
     operations       30,590    34,984  (1,454)  (2,185)   29,136   32,799

    Financing and
     Other Income
    Interest income,
     net               1,458     1,855       -        -     1,458    1,855
    Other expense
     (income), net     (963)        37       -        -      (963)      37
      Total financing
       and other
       income            495     1,892       -        -       495    1,892
    Income (loss)
     from continuing
     operations
     before income
     taxes           $31,085   $36,876 $(1,454) $(2,185)  $29,631  $34,691
      Provision for
       income taxes                                        12,772   13,358
    Income from
     continuing
     operations                                            16,859   21,333
     Income (loss)
      from
      discontinued
      operations, net
      of tax                                                 (435)     125
    Net income                                            $16,424  $21,458

    Basic earnings (loss) per share:
      From continuing operations                           $ 1.42    $1.71
      From discontinued operations                         $(0.04)   $0.01
        Basic earnings per share                           $ 1.38    $1.72

    Diluted earnings (loss) per share
      From continuing operations                           $ 1.36    $1.63
      From discontinued operations                         $(0.03)   $0.01
        Diluted earnings per share                         $ 1.33    $1.64

      Basic weighted average shares outstanding            11,897   12,484
      Diluted weighted average shares outstanding          12,351   13,048


    (a)  An insignificant amount of general and administrative services is
         provided to the Angel.com business unit by MicroStrategy's core
         business operations.



                          MICROSTRATEGY INCORPORATED
                         CONSOLIDATED BALANCE SHEETS
                    (in thousands, except per share data)

                                                   June 30,       December 31,
                                                     2008              2007
    Assets                                       (unaudited)        (audited)
    Current assets
      Cash and cash equivalents                   $119,603           $85,194
      Restricted cash and investments                2,293             2,982
      Accounts receivable, net                      40,405            49,392
      Prepaid expenses and other current assets     13,618            12,106
      Deferred tax assets, net                      24,829            29,652
      Assets held-for-sale                           8,846             4,272
    Total current assets                           209,594           183,598

    Property and equipment, net                      8,954             9,473
    Capitalized software development cost, net       4,604             2,340
    Deposits and other assets                       11,907            11,433
    Deferred tax assets, net                        31,805            35,347
    Total Assets                                  $266,864          $242,191

    Liabilities and Stockholders' Equity
    Current liabilities
      Accounts payable and accrued expenses        $23,612           $22,083
      Accrued compensation and employee benefits    33,034            38,604
      Deferred revenue and advance payments         75,825            64,234
      Liabilities held-for-sale                      8,571             3,436
    Total current liabilities                      141,042           128,357

    Deferred revenue and advance payments            1,127             1,368
    Other long-term liabilities                     10,279             9,137

    Total Liabilities                              152,448           138,862

    Stockholders' Equity
      Preferred stock undesignated, $0.001 par
       value; 5,000 shares authorized; no shares
       issued or outstanding                             -                 -
      Class A common stock, $0.001 par value;
       330,000 shares authorized; 14,161 shares
       issued and 9,114 shares outstanding, and
       14,113 shares issued and 9,184 shares
       outstanding, respectively                        14                14
      Class B common stock, $0.001 par value;
       165,000 shares authorized; 2,770 issued
       and outstanding, respectively                     3                 3
      Additional paid-in capital                   450,464           448,229
      Treasury stock, at cost; 5,047 and
       4,929 shares, respectively                 (366,191)         (357,804)
      Accumulated other comprehensive income         3,744             2,929
    Retained earnings                               26,382             9,958
    Total Stockholders' Equity                     114,416           103,329
    Total Liabilities and Stockholders' Equity    $266,864          $242,191



                           MICROSTRATEGY INCORPORATED
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                                 (in thousands)
                                   (unaudited)
                                                        Six Months Ended
                                                            June 30,
                                                      2008              2007

    Operating activities:
      Net income                                   $16,424           $21,458
      Plus:  Loss (income) from discontinued
       operations, net                                 435             $(125)
        Income from continuing operations           16,859            21,333
      Adjustments to reconcile net income to
       net cash provided by operating activities
        Depreciation and amortization                3,102             3,837
        Bad debt expense                               561               626
        Deferred taxes                               8,539            10,647
        Stock-based compensation                        45               296
        Excess tax benefits from stock-based
         payment arrangements                         (178)           (2,191)
        Other, net                                      32                70
      Changes in operating assets and liabilities:
        Accounts receivable                         10,656            18,228
        Prepaid expenses and other current assets   (1,142)               43
        Deposits and other assets                     (334)           (1,512)
        Accounts payable and accrued expenses,
         compensation and employee benefits,
         accrued interest                           (6,091)          (12,425)
        Deferred revenue and advance payments        8,345             9,465
        Other long-term liabilities                  1,198             1,336
          Net cash provided by operating
           activities from continuing operations    41,592            49,753
          Net cash provided by (used in)
           operating activities from
           discontinued operations                     472            (3,125)
          Net cash provided by operating
           activities                               42,064            46,628
    Investing activities:
      Advance deposits on purchases of property
       and equipment                                     -            (5,000)
      Purchases of property and equipment, net      (1,770)           (2,069)
      Capitalized software development costs        (2,862)           (2,419)
      Decrease in restricted cash and investments      758                39
        Net cash used in investing activities
         from continuing operations                 (3,874)           (9,449)
        Net cash used in investing activities
         from discontinued operations                  (84)              (43)
        Net cash used in investing activities       (3,958)           (9,492)
    Financing activities:
      Proceeds from sale of class A common stock
       under exercise of employee stock options
       and employee stock purchase plan              1,986             1,816
      Excess tax benefits from stock-
       based payment arrangements                      178             2,191
      Purchases of treasury stock                   (8,387)          (44,740)
        Net cash used in financing activities
         from continuing operations                 (6,223)          (40,733)
        Net cash used in financing activities
         from discontinued operations                    -                 -
        Net cash used in financing activities       (6,223)          (40,733)
        Effect of foreign exchange rate changes
         on cash and cash equivalents                2,526               757
    Net increase (decrease) in cash and cash
     equivalents from continuing operations         34,409            (2,840)
    Cash and cash equivalents, beginning of
     period                                         85,194            78,980
    Cash and cash equivalents, end of period      $119,603           $76,140


SOURCE MicroStrategy Incorporated

http://www.microstrategy.com/

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