Strategy (MSTR) Stock Plunges 17% After Earnings Show $12.4 Billion Bitcoin Hit

TLDR

Table of Contents

Strategy posted a $12.4 billion loss in Q4 2025 as Bitcoin plummeted 22% from $126,000 to $88,500
MSTR shares crashed 17% to $107 on Thursday as Bitcoin dropped to $62,500, leaving the company’s holdings underwater
The firm owns 713,502 Bitcoin purchased at an average of $76,052, now trading at $64,500 for a 17.5% paper loss
Strategy maintains $2.25 billion in cash with no debt due until 2027, giving it runway to weather the downturn
CEO Phong Le dismissed panic saying the company’s 13% net leverage is below most S&P 500 firms

Strategy reported a brutal $12.4 billion net loss for the fourth quarter of 2025. Bitcoin’s collapse from $126,000 to $88,500 during the period drove the entire loss.

$MSTR (Strategy) #earnings are out: pic.twitter.com/Q4T40LyzXI

— The Earnings Correspondent (@earnings_guy) February 5, 2026

The damage didn’t stop there. Bitcoin has fallen another 30% in 2025 to $64,500. That’s well below Strategy’s average buy price of $76,052 per coin.

MSTR shares got hammered on Thursday, closing down 17% at $107. The selloff came as Bitcoin crashed to $62,500 during the session.

Strategy Inc, MSTR

The company’s 713,502 Bitcoin are now worth roughly $46 billion. That puts Strategy underwater by 17.5% on its total holdings.

Revenue Growth Can’t Offset Crypto Losses

Strategy did manage to grow its business intelligence revenues. The core software business posted $123 million in Q4 sales, up 1.9% year-over-year.

But those gains were completely wiped out by the Bitcoin bloodbath. The crypto losses dwarfed any operational progress.

CFO Andrew Kang tried to calm investors in the earnings release. He claimed Strategy’s capital structure is “stronger and more resilient today than ever before.”

Kang pointed to what he called a “digital fortress” of Bitcoin. He also mentioned the company’s pivot to “Digital Credit” as part of its long-term Bitcoin play.

CEO Phong Le was blunt on the earnings call. “I’m not worried, we’re not worried, and no, we’re not having issues,” he told analysts.

Cash Cushion Buys Time

Le highlighted that Strategy’s enterprise value still tops its $45 billion Bitcoin stash. He stressed that the company’s $8.2 billion in convertible debt only represents 13% net leverage.

That leverage ratio sits below most S&P 500 companies. Management used this metric to push back on concerns about excessive debt.

Strategy closed Q4 with $2.25 billion in cash. That money covers 30 months of preferred stock dividends plus debt interest payments.

The company faces no major debt maturities until 2027. This gives Strategy breathing room to hold Bitcoin without forced selling.

This matters as prices keep falling. Strategy isn’t backed into a corner where it must liquidate at terrible prices.

Executive Chairman Michael Saylor has made clear he plans to hold Bitcoin forever. The company continues buying despite the losses.

Strategy’s $76,052 average purchase price includes billions in Bitcoin bought after Q4 ended. The buying spree continued even as prices declined.

The current Bitcoin price of $64,500 sits $11,500 below Strategy’s average cost. That’s a paper loss of roughly $8 billion on the total holdings.

Investors tuned into the 5 PM ET earnings call for more details. They wanted to hear how management plans to navigate the current market chaos with the company’s Bitcoin position deep in the red.

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