Non-GAAP measures can be useful for investors, but they are also controversial. Some argue that certain non-GAAP adjustments are unacceptable and should not be permitted. This recently happened to US company MicroStrategy, where the SEC required it to amend the presentation of cryptocurrency gains and losses.
We do not agree with the SEC approach and believe MicroStrategy gives valid reasons for its cryptocurrency non-GAAP adjustment. We have less sympathy with other aspects of the company’s non-GAAP earnings calculation. However, we believe that the disaggregation that results from all non-GAAP disclosures generally benefits investors.Continue reading “Non-GAAP is more than earnings before bad stuff”