Bitcoin giant Strategy Inc. reported a steep fourth-quarter loss, as a swing in the value of its large bitcoin holdings forced the company to record a $17.4 billion unrealized loss.
In its fourth-quarter 2025 earnings report, the Bitcoin Treasury company said operating loss for the three months to Dec. 31 widened to $17.4 billion from a loss of $1.0 billion a year earlier, when it was still using an impairment model for crypto accounting.
Additionally, net loss widened to $12.4 billion, or $42.93 per diluted share, after the price of bitcoin fell sharply, sliding from an early-October peak of around $126,000 to below $88,500 at the end of the quarter and then to roughly $64,500 this year, under Strategy’s average purchase price of $76,052 per coin.
Despite the heavy losses, software operations remained profitable but too small to counter the digital asset swing, with total revenue edging up 1.9% year-on-year to $123.0 million while gross margin slipped to 66.1% from 71.7%.
713,502 Bitcoin Held As Treasury Stack Grows Despite Fair-Value Hit
Even as the fourth-quarter was dominated by fair-value losses, Strategy continued to buy bitcoin aggressively, ending December with about 672,500 bitcoin on its balance sheet at a carrying value of $58.9 billion and an average purchase price of roughly $75,000 per coin.
By Feb. 1, the holding had risen to 713,502 bitcoin at a total cost of $54.26 billion and a market value of $59.75 billion, based on a bitcoin price of about $83,740 on Jan. 30.
Strategy’s management said its “BTC Yield,” an internal metric tied to bitcoin per share, reached 22.8% for 2025, with a “BTC Gain” of 101,873 coins and a dollar value of $8.9 billion using year-end prices.
$25.3 Billion Raised In 2025 To Fund Bitcoin Accumulation And Credit Products
Strategy leaned heavily on capital markets in 2025, raising $25.3 billion over the year and $5.6 billion in the fourth quarter alone through at-the-market common stock programs and preferred equity offerings that helped fund its bitcoin purchases and balance-sheet strategy.
Between Jan. 1 and Feb. 1 this year, the company brought in another $3.9 billion, largely from issuing 20.2 million additional Class A shares, and said that at the start of February it still had about $8.1 billion of capacity under its common-stock ATM program alongside sizable room on its various preferred-stock ATMs.
STRC, the company’s primary digital credit preferred stock, has grown to $3.4 billion outstanding and currently pays an 11.25% dividend. Strategy said it will fine-tune the dividend on a monthly basis with the aim of keeping the issue near its $100 par value.
$123 Million In Software Revenue As Subscriptions Jump But Legacy Lines Shrink
Strategy’s traditional analytics software unit posted fourth-quarter revenue of $123.0 million, as subscription services grew 62.1% from a year earlier to $51.8 million, while product support revenue fell 16.9% to $48.5 million and other services dipped 1.8% to $14.9 million.
Operating expenses excluding digital asset marks declined modestly across sales, marketing, research, and administration, reflecting the firm’s gradual shift in emphasis from selling software toward managing a large bitcoin-backed capital structure.
$2.25 Billion Cash Reserve Backs Payouts Treated As Return Of Capital
To support interest and preferred-stock dividends, Strategy ended the year with a dedicated U.S. dollar reserve of $2.25 billion, which it said was funded from common-stock issuance, provides roughly two and a half years of coverage at current payout levels, and may be adjusted over time depending on market conditions and liquidity needs.
In 2025, payouts on Strategy’s preferred stock were classified as a return of capital, meaning investors did not owe U.S. income tax on them but saw their cost basis reduced instead. The company said it expects that approach to remain in place for “ten years or more” but warned that a shift to consistent profits could lead to a different tax treatment.
Strategy Executives Remain Optimistic Despite Heavy Losses
Despite the scale of the quarterly loss, Strategy CEO Phong Le told investors on an earnings call that there was no reason to panic about the company’s financial position. “I’m not worried, we’re not worried, and no, we’re not having issues,” he said.
Executive Chairman Michael Saylor has likewise continued to back the company’s approach in regular posts on X, saying Strategy’s playbook is unchanged and restating what he describes as bitcoin’s basic rules: buy bitcoin, do not sell it, and hold on through market swings.
