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Strategy’s $12.6 Billion Quarterly Loss Roils Markets as Bitcoin Slide Whipsaws MSTR Shares

Management says liquidity buffers plus covenant‑light debt insulate the balance sheet despite the mark‑to‑market hit.

Overview

  • Strategy reported a Q4 operating loss of about $17.4 billion and a net loss of roughly $12.6 billion after adopting fair‑value accounting that marked its bitcoin lower.
  • The company now holds 713,502 BTC—about 3.4% of eventual supply—and continued buying in early February, including 855 coins acquired at an average price near $88,000.
  • CEO Phong Le said bitcoin would need to drop to roughly $8,000 and stay there for five to six years to pressure debt service, citing a $2.25 billion cash reserve and no price‑based covenants.
  • MSTR plunged on the earnings headline then rebounded roughly 20%–25% as bitcoin recovered from Thursday’s lows, underscoring the stock’s tight correlation with BTC moves.
  • Eleven U.S. state pension funds holding about 1.8 million MSTR shares are sitting on an estimated $337 million in unrealized losses following the recent drawdown.