MicroStrategy Checks Every Box—So Why Did It Get Snubbed by the S&P 500?

MicroStrategy has the metrics, the momentum, and the market cap—so what’s keeping it out of the big leagues?

The Bitcoin Bet That’s Paying Off—Big Time

With a treasury stacked with Bitcoin and a stock that’s been on a tear, MicroStrategy looks like a textbook candidate for S&P 500 inclusion. Revenue growth? Check. Investor confidence? Through the roof. Yet here we are—still waiting.

The Quiet Rejection No One Saw Coming

Wall Street’s gatekeepers love tradition almost as much as they love fees. Maybe it’s the crypto-skeptic old guard, or maybe it’s just another case of institutional inertia. Either way, MicroStrategy’s snub raises eyebrows—and questions about what really drives index decisions.

When Fundamentals Aren’t Enough

They’ve ticked every box—liquidity, profitability, U.S. incorporation—but sometimes, even a perfect report card isn’t enough. Especially when you’re playing with an asset class that still makes some financiers clutch their pearls—and their spreadsheets.

So while the S&P committee drags its feet, MicroStrategy keeps stacking sats and outperforming half the companies already in the club. Ironic, isn’t it? Maybe the index needs them more than they need the index.

MicroStrategy (NASDAQ: MSTR) stock recently met the formal requirements for inclusion in the S&P 500.

However, its addition is subject to the discretion of the S&P Dow Jones Indices committee. As per latest news update, it has missed the mark.

In Q2 2025 MicroStrategy reported record earnings ( $10 billion net income on $114 million revenue). That’s thanks to new accounting rules for its Bitcoin holdings.

As a result, it checks all the technical boxes for S&P 500 eligibility. It is a U.S.-domiciled company listed on Nasdaq.

It has a market capitalization far above the several-billion-dollar threshold, average daily trading volume well above requirements.

Additionally, public float exceeds 50%, and positive earnings in the most recent quarter and on a trailing 12-month basis.

For example, analysts have noted that MicroStrategy,

“…easily meets S&P 500 inclusion criteria in terms of market cap and trading volume.”

Its new reporting treatment of bitcoin should allow it to “immediately begin reporting positive earnings.”

Inclusion Criteria and Timeline

S&P 500 membership is governed by published criteria and quarterly review windows.

MicroStrategy meets or exceeds each of these: its market cap is well above the threshold, trading volumes are robust, and it reported positive net income in Q2 2025 (unlike prior years) under the new FASB rules.

The timing of any change is well-defined: S&P Dow Jones Indices updates the S&P 500 four times a year. Usually, this happens in March, June, September, and December.

Changes are announced on the second Friday of the quarter and become effective after trading closes the following Friday.

And per the announcement, the S&P 500 has decided not to include MicroStrategy. According to analyst observations, inconsistency is a likely factor behind this decision.

Is S&P 500 Ready for MicroStrategy (MSTR stock) and Bitcoin?

Crucially, meeting the quantitative criteria does not guarantee inclusion. The S&P 500 Index Committee has broad discretion and considers the overall sector and industry composition of the index.

As Charles Schwab explained, the Committee “doesn’t base [its decisions] simply on the top-500 market capitalizations.” Rather it is based on representing the full market sectors in balance.

For example, the S&P may choose among eligible candidates to maintain a desired weight in technology, consumer, energy, or other sectors, or to reflect recent removals.

The Committee does not publish detailed reasons for its picks. So investors cannot assume that any candidate will definitely be added just because it qualifies on paper.

This discretionary element has led to unpredictable outcomes. In recent quarters, several companies that easily met the technical hurdles were nonetheless passed over.

For instance, in June 2025 AppLovin (APP) and Cheniere Energy Partners (CQP) met all S&P 500 metrics but were “overlooked anyway.” After the no-change announcement, their stocks fell sharply on disappointment.

Likewise, Robinhood Markets was widely viewed as a likely new addition in mid-2025 given its U.S. listing and robust market cap.

But the June rebalancing saw no additions or removals, and Robinhood’s shares dropped about 5% on the news.

These cases underscore that “speculating each quarter on who’s in and who’s out can be dangerous”; eligibility is necessary but not sufficient.

If MicroStrategy Had Made It

If MicroStrategy had been added, it WOULD would’ve trigger substantial passive buying and could materially boost the stock price, at least initially.

When a company joins the S&P 500, index funds and ETFs that track the index must buy its shares, creating a surge in demand.

Schwab notes that “most mutual funds and exchange-traded funds that seek to emulate the index buy shares of the new addition”, yielding “a quick burst of money” for the stock.

Empirical cases bear this out: Tesla’s announcement/inclusion in December 2020 saw TSLA stock jump roughly 60% from the day before the announcement to actual inclusion.

In fact, much of Tesla’s gains occurred in anticipation of the move.