MicroStrategy is dead; long live Strategy. Michael Saylor’s newly rebranded treasury vehicle reported a staggering $12.4 billion net loss for Q4 2025 Thursday, a figure that instantly sent shares plunging 17% in after-hours trading.
The report marks the first earnings call under the company’s stripped-down moniker, “Strategy Inc.” (NASDAQ: MSTR), but the numbers tell the old story: leveraged exposure to a volatile asset. Following Bitcoin’s 40% retracement from its $126,000 October peak to roughly $63,000, the company was forced to book a $17.4 billion operating loss, primarily driven by unrealized losses on its digital asset holdings.
The Paper Fire
While the headline number is jarring, the filing reveals the mechanics of the damage. Under the fair value accounting standards adopted in 2025, Strategy must mark its holdings to market quarterly. The result? A massive paper hit that obliterates the $123 million generated by its legacy software business (+1.9% YoY).
Despite the red ink, the accumulation machine hasn’t stopped. The firm disclosed it now holds 713,502 BTC, valued at approximately $45 billion at current prices. The company also confirmed it acquired another 41,002 BTC in January 2026 alone, doubling down as the market corrected.
The company established a $2.25 billion USD Reserve providing approximately 2.5 years of coverage for preferred stock dividends and debt interest payments.
Institutional Context
The rebrand to “Strategy” signals Saylor’s final pivot away from pretending to be a software company first. However, the market’s reaction (-17% to ~$112) reflects growing anxiety over the sheer scale of the leverage. With Bitcoin hovering near $63,000, MSTR’s premium to NAV is compressing rapidly.
Analysts are now watching the “BTC Yield” metric, reported at 22.8% for 2025, to see if the issuance of new shares to buy falling coins can outpace the dilution. For now, the market sees a $12 billion hole; Saylor sees a discount.
