Strategy, the company formerly known as MicroStrategy, is poised for one of its toughest year-end closings to date, as Bitcoin (BTC) prices have retraced below the $90,000 mark from highs exceeding $126,000. This downturn is expected to culminate in a multibillion-dollar loss when the firm releases its fourth-quarter financial results.
Strategy’s Earnings Expected To Plunge
According to reports from Bloomberg, Strategy is likely to announce substantial losses that represent a stark contrast to the $2.8 billion profit recorded in the previous third-quarter of the last year.
Aaron Jacob, an associate professor at Brigham Young University and a senior adviser at Taxbit, noted the significance of this shift, stating, “There was this one-time pop, but that is a different story in this quarter. It is going to be a sizable loss.”
The root of this anticipated loss can be traced back to an accounting change implemented in the first quarter of the year, requiring the company to value its cryptocurrency assets at current market prices. Given that Bitcoin tumbled 24% during the fourth quarter, the impact of this decision is now becoming evident.
Following a period of strong performance against benchmark stock indices, the company’s shares have fallen nearly 48% throughout 2025, down to its current trading price of $156.
Saylor’s Wealth Plummets 40%
Concerns have also emerged that Strategy may need to sell portions of its Bitcoin holdings to cover mounting expenses, including dividends and interest payments. To mitigate these apprehensions, Strategy established a cash reserve on December 1 by selling common shares.
Strategy also revised its full-year earnings guidance at the beginning of last month. The company is operating under the assumption that Bitcoin will range between $85,000 and $110,000 by year-end.
Based on these projections, it anticipated operating income could range from a loss of $7 billion to a profit of $9.5 billion. However, with Bitcoin finishing the year down 6.5%, the likelihood leans toward a loss closer to the lower end of that spectrum.
According to the Bloomberg Billionaires Index, the company’s co-founder and chairman, Michael Saylor, has also suffered a dramatic drop in personal wealth during this downturn, with his fortune falling by around 40% to approximately $3.8 billion.
Market-To-Net Asset Value Drops To Critical Levels
As if to compound the company’s challenges, Strategy now faces a potential decline in investor confidence. The enterprise value of the firm is nearing a level that could fall below the value of its Bitcoin holdings for the first time in over two years.
Current data suggests the company’s enterprise value—including its debts and the total notional value of its perpetual preferred stock—stands at approximately $61 billion.
With shares down nearly 70% from the record high reached in November 2024, the company’s market-to-net asset value (mNAV)—a ratio comparing market capitalization and debt to token holdings—has dropped to just above 1.
Featured image from DALL-E, chart from TradingView.com
