MicroStrategy, now operating as Strategy, has reported a staggering fourth-quarter net loss of approximately $12.4 billion. This significant financial hit is largely attributed to the sharp decline in Bitcoin prices, which has erased substantial paper gains on the company’s extensive cryptocurrency holdings. The company’s stock also experienced a notable drop following the earnings announcement.
Founded in 1989, Strategy spent decades as an enterprise software company before co-founder Michael Saylor pivoted the firm towards Bitcoin as a treasury reserve asset around 2020. The strategy was to hedge against monetary debasement, transforming the company into the world’s largest corporate Bitcoin holder. This shift led to a rebranding to “Strategy” and drew scrutiny from regulators and index providers.
The company’s financial results are now deeply intertwined with the price movements of Bitcoin. During the fourth quarter of 2025, Bitcoin experienced a significant drawdown, falling below Strategy’s average purchase price. This flip from substantial unrealized gains to deep losses directly impacted the company’s net asset value (mNAV) and overall quarterly performance. Strategy reported total revenues of $123 million in Q4 2025, with a gross profit of $81.3 million.
Following the earnings report, Strategy’s stock (MSTR) saw a sharp decline, closing down 17% on February 5th and continuing a year-to-date drop of 30%. The company’s market-to-net asset value (mNAV) has fallen, indicating that the stock is barely trading at a premium to its Bitcoin holdings. Despite these challenges, Michael Saylor has reiterated his commitment to the company’s Bitcoin strategy, emphasizing a long-term investment horizon. As of February 1st, Strategy held 713,502 Bitcoin, acquired at a total cost of $54.26 billion.
