Strategy Inc. Posts $12.4B Loss as Bitcoin Bet Turns Underwater

Strategy Inc. (formerly MicroStrategy) reported a historic $12.4 billion net loss for the fourth quarter of 2025, driven by a massive $17.4 billion fair-value hit to its Bitcoin treasury. The results, released Thursday, confirm Wall Street’s fears: the company’s leveraged accumulation strategy has hit a mathematical wall.

The loss marks one of the largest corporate drawdowns since the 2008 financial crisis. Strategy Inc. (MSTR) shares plummeted 17% in response, erasing months of premium as the underlying asset struggled to hold support.

The Underwater Treasury

Strategy Inc. now controls 713,502 BTC, nearly 3.4% of the total Bitcoin supply. But the economics of that stack have inverted. The company acquired its hoard for a total of $54.3 billion, pushing its average cost basis to roughly $76,000 per coin.

With Bitcoin currently trading in the low $60,000s, the firm’s positions are deeply underwater. Unlike previous quarters where “paper losses” were ignored under old accounting rules, the shift to fair-value accounting has forced these fluctuations directly onto the income statement. The result is a multi-billion dollar hole that cannot be glossed over.

Liquidity vs. Solvency

Despite the headline bleed, immediate insolvency is unlikely. The company disclosed a $2.3 billion USD reserve designed to cover dividends and debt service for the next 30 months. This buffer, funded by aggressive equity issuance in 2025, buys Michael Saylor time to wait for a market reversal.

The company acquired 41,002 bitcoins in January 2026 alone, signaling no retreat from its core accumulation strategy.

The market remains skeptical. The stock’s double-digit slide suggests investors are re-evaluating the risk of a “forced seller” scenario. If Bitcoin falls further, the pressure to deleverage could transition from a bearish narrative to a mathematical necessity.