Strategy, the corporate bitcoin treasury company formerly known as Microstrategy, has unveiled plans for a massive $21 billion at-the-market (ATM) common stock offering to finance further bitcoin acquisitions. The announcement came alongside the release of its first-quarter 2025 earnings, which showed a net loss of $4.2 billion, or $16.49 per diluted share.
Q1 Financial Results: Losses Driven by Bitcoin Accounting Changes
The hefty net loss was primarily caused by a $5.9 billion unrealized loss on its bitcoin holdings under new fair value accounting rules adopted in 2025. CFO Andrew Kang explained that the fair value accounting initially lifted retained earnings by $12.7 billion, but the sharp decline in bitcoin's price from its peak during the quarter to $82,445 at quarter-end triggered the unrealized loss. Operating expenses surged 1,976% year-over-year to $6 billion, largely due to accounting adjustments tied to bitcoin. Meanwhile, the company's software revenue fell 3.6% to $111.1 million, although subscription services revenue grew 61.6%. Cash reserves increased to $60.3 million from $38.1 million in December 2024.
Bitcoin Strategy and Holdings: Doubling Down
Despite the red ink, Strategy remains committed to its bitcoin accumulation strategy. As of quarter-end, the firm held 553,555 bitcoin acquired at an average cost of $68,459 per coin. CEO Phong Le stated that the $21 billion ATM program has already enabled the addition of 301,335 bitcoin during the quarter, while the company's stock price rose 50% in the same period. Strategy raised its 2025 BTC yield target from 15% to 25%, and noted that over 70 public companies worldwide have now adopted a bitcoin treasury standard.
During Q1, Strategy raised $7.7 billion in net proceeds through stock sales, convertible notes, and preferred stock offerings. It also increased the authorized shares of Class A common stock to 10.3 billion to facilitate future equity raises.
Market Impact and Risk Factors
At the end of Q1, Strategy's bitcoin holdings were valued at approximately $43.5 billion. As of May 1, 2025, bitcoin was trading around $96,619, implying a current market value of roughly $53.5 billion for the company's stash. In its earnings report, Strategy cautioned that bitcoin price volatility, regulatory changes, and liquidity risks could materially affect future results. Nevertheless, the firm continues to position itself as the world's largest corporate bitcoin holder, leveraging aggressive equity offerings to expand its crypto treasury.