Strategy Announces First Quarter 2025 Financial Results

• 13.7% “BTC Yield” achieved in 2025 YTD
• 61,497 “BTC Gain” achieved in 2025 YTD
• $5.8 billion “BTC $ Gain” achieved in 2025 YTD
• 553,555 bitcoin holdings at a total cost of $37.90 billion, or $68,459 per bitcoin, as of April 28, 2025
• Announces a new $21 billion at-the-market (ATM) common stock equity offering
• Increasing 2025 “BTC Yield” target from 15% to 25%
• Increasing 2025 “BTC $ Gain” target from $10 billion to $15 billion

MicroStrategy^® Incorporated d/b/a Strategy™ (Nasdaq: MSTR/STRK/STRF) (“Strategy” or the “Company”), the largest corporate holder of bitcoin and the world’s first Bitcoin Treasury Company, today announced financial results for the three-month period ended March 31, 2025 (the first quarter of its 2025 fiscal year).

“We successfully executed our record $21 billion common stock ATM, adding 301,335 BTC to our balance sheet while simultaneously achieving a 50% increase in MSTR share price during the same period. In Q1, we also broadened our capital base with two of the most successful preferred stock IPOs in a decade. Our capital markets strategy continues to grow our Bitcoin holdings while delivering superior shareholder value. With over 70 public companies worldwide now adopting a Bitcoin treasury standard, we are proud to be at the forefront in pioneering this space,” said Phong Le, President and Chief Executive Officer.

“We are thrilled to report a strong start to the year with a year-to-date “BTC Yield” of 13.7%, achieving over 90% of our 2025 target in just the first four months of the year. Our year-to-date “BTC $ Gain” of $5.8 billion also meets 58% of our annual target, demonstrating the effectiveness of our Bitcoin strategy. With the strong momentum in the market and our successful execution of our treasury operations thus far this year, we are increasing our 2025 “BTC Yield” target to 25% and our 2025 “BTC $ Gain” target to $15 billion. Also in Q1, we adopted the long-awaited fair value accounting for our Bitcoin holdings, which resulted in a significant $12.7 billion uplift in the beginning balance of retained earnings. And despite recognizing an unrealized loss in Q1 due to a quarter-end Bitcoin price of $82,445, the current approximate $97,300 Bitcoin price would imply a fair value gain of roughly $8.0 billion thus far in Q2,” said Andrew Kang, Chief Financial Officer.

Bitcoin Treasury Highlights

• “BTC Yield” KPI: Achieved BTC Yield of 11.0% in Q1 and 13.7% year-to-date (as of April 28, 2025), compared to the full year 2025 target of 15%.
• “BTC Gain” KPI: Achieved BTC Gain of 49,131 in Q1 and 61,497 year-to-date (as of April 28, 2025).
• “BTC $ Gain” KPI: Achieved BTC $ Gain of $4.1 billion in Q1 (based on a bitcoin price of $82,445 as of March 31, 2025) and $5.8 billion year-to-date (based on bitcoin price of approximately $95,000 as of April 28, 2025), compared to the full year 2025 target of $10 billion.
• Digital Assets: As of March 31, 2025, the Company’s digital assets were comprised of approximately 528,185 bitcoins, with an original cost basis and market value of $35.6 billion and $43.5 billion, respectively, which reflects an average cost per bitcoin of approximately $67,457 and a market price per bitcoin of $82,445, respectively.
  • On January 1, 2025, the Company adopted ASU 2023-08 which requires that bitcoin holdings are remeasured at fair value with gains and losses from change in the fair value of bitcoin recognized in net income (loss) at each reporting period.
  • As a result of the adoption of ASU 2023-08, a cumulative net increase was applied to the opening balance of retained earnings as of January 1, 2025 of $12.7 billion. During the first three months ended March 31, 2025, the Company recorded an unrealized fair value loss on digital assets of $5.9 billion.
• Capital Markets Update: The Company received aggregate net proceeds of approximately $7.7 billion during the three months ended March 31, 2025, and additional aggregate net proceeds of approximately $2.3 billion between April 1, 2025 and April 28, 2025, from the following transactions:
  • Common Stock ATM Offering: During the three months ended March 31, 2025, the Company received aggregate net proceeds of approximately $4.4 billion through the issuance and sale of 12,624,595 shares of its class A common stock. Between April 1, 2025 and April 28, 2025, the Company received aggregate net proceeds of approximately $2.2 billion through the issuance and sale of an additional 6,734,712 shares of its class A common stock. As of April 28, 2025, approximately $128.7 million remained available under the October 2024 at-the-market class A common stock equity offering program.
  • Issuance of 2030B Convertible Notes: In February 2025, the Company issued $2.0 billion in 0% Convertible Senior Notes due 2030 with an initial conversion price of $433.43 per share of class A common stock, for net proceeds of approximately $1.99 billion.
  • IPO of Perpetual Strike Preferred Stock: In January 2025, the Company received net proceeds of approximately $563.2 million through the issuance and sale of 7,300,000 shares of 8.00% Series A Perpetual Strike Preferred Stock (the “STRK Shares”) at a public offering price of $80.00 per share.
  • Perpetual Strike Preferred Stock ATM Offering: In March, 2025, the Company entered into an agreement (the “STRK ATM”) to issue and sell up to $21 billion of STRK Shares. Through March 31, 2025, the Company received aggregate net proceeds of approximately $30.4 million through the issuance and sale of 349,907 STRK Shares. Between April 1, 2025 and April 28, 2025, the Company received aggregate net proceeds of approximately $45.3 million through the issuance and sale of an additional 526,282 STRK Shares As of April 28, 2025, approximately $20.9 billion remained available under the STRK ATM.
  • IPO of Perpetual Strife Preferred Stock: In March 2025, the Company received net proceeds of approximately $710.9 million through the issuance and sale of 8,500,000 shares of 10.00% Series A Perpetual Strife Preferred Stock at a public offering price of $85.00 per share.
• Increase in Authorized Class A Common Stock and Preferred Stock: In January 2025, the Company’s stockholders approved an amendment to the Company’s Certificate of Incorporation increasing the number of authorized shares of class A common Stock from 330,000,000 to 10,330,000,000 and the number of authorized shares of preferred stock from 5,000,000 to 1,005,000,000.
• Redemption and Conversions of 2027 Convertible Notes: In January 2025, the Company delivered a notice of redemption of its 0% Convertible Senior Notes due 2027 (the “2027 Convertible Notes”) for redemption of all $1.05 billion in aggregate principal amount of the 2027 Convertible Notes outstanding. The Company received conversion requests for substantially all of the $1.05 billion of the 2027 Convertible Notes, and issued 7,373,528 shares of class A common stock in settlement of the conversion requests, and redeemed the remaining $0.1 million aggregate principal amount of the 2027 Convertible Notes. As of March 31, 2025, all 2027 Convertible Notes have been converted or redeemed and are no longer outstanding.

Q1 2025 Software Business Highlights

• Revenues:
  • Total revenues were $111.1 million, a 3.6% decrease year-over-year, compared to the first quarter of 2024.
  • Subscription Services Revenues were $37.1 million, a 61.6% increase year-over-year, compared to the first quarter of 2024.
  • Product licenses and subscription services revenues were $44.4 million, a 23.6% increase year-over-year, compared to the first quarter of 2024.
  • Product support revenues were $52.5 million, a 16.2% decrease year-over-year, compared to the first quarter of 2024.
  • Other services revenues were $14.2 million, a 15.0% decrease year-over-year, compared to the first quarter of 2024.
• Gross Profit: Gross profit for the first quarter of 2025 was $77.1 million, representing a 69.4% gross margin, compared to $85.2 million, representing a gross margin of 74.0%, for the first quarter of 2024.

Other Q1 Financial Highlights

• Operating Expenses: Operating expenses for the first quarter of 2025 were approximately $6.0 billion, a 1,976.1% increase year-over-year. Operating expenses for the first quarter of 2025 include unrealized losses on the Company’s digital assets, which were $5.9 billion. This reflects the first reporting period for which we have applied fair value accounting. Digital asset impairment losses for the first quarter of 2024, determined in accordance with the cost-less-impairment accounting model we were subject to prior to January 1, 2025, were $191.6 million.
• Loss from Operations, Net Loss and Net Loss Attributable to Common Stockholders: Loss from operations was $5.921 billion, compared to $203.7 million for the first quarter of 2024. Net loss was $4.217 billion, or $16.49 per common share on a diluted basis, as compared to $53.1 million, or $0.31 per common share on a diluted basis, for the first quarter of 2024. Net loss attributable to common stockholders was $4.228 billion as compared to $53.1 million for the first quarter of 2024.
• Cash and Cash Equivalents: As of March 31, 2025, the Company had cash and cash equivalents of $60.3 million, as compared to $38.1 million as of December 31, 2024, an increase of $22.2 million.

The tables provided at the end of this press release include a reconciliation of the most directly comparable financial measures prepared in accordance with generally accepted accounting principles in the United States (“GAAP”) to non-GAAP financial measures for the three months ended March 31, 2025 and 2024. An explanation of non-GAAP financial measures is also included under the heading “Non-GAAP Financial Measures” below. Additional non-GAAP financial measures are included in Strategy’s “Q1 2025 Earnings Presentation,” which will be available under the “Events and Presentations” section of Strategy’s investor relations website at https://www.strategy.com/investor-relations.

Strategy Dashboard

Strategy’s dashboard can be found on its website at strategy.com, which can be used as a disclosure channel to provide broad, non-exclusionary distribution of information regarding the Company to the public. Some of the information distributed through the website dashboard may be considered material information. The website dashboard will include information regarding market data for our securities and bitcoin, BTC Yield, BTC Gain and BTC $ Gain KPIs, bitcoin purchases, bitcoin holdings, capital markets activity, and other related information. Investors and others are encouraged to regularly review the information that the Company makes public via the website dashboard.

Conference Call

Strategy will be discussing its first quarter 2025 financial results on a live Video Webinar today beginning at approximately 5:00 p.m. ET. The live Video Webinar and accompanying presentation materials will be available under the “Events and Presentations” section of Strategy’s investor relations website at https://www.strategy.com/investor-relations. Log-in instructions will be available after registering for the event. An archived replay of the event will be available beginning approximately two hours after the call concludes.

About Strategy

MicroStrategy Incorporated d/b/a Strategy (Nasdaq: MSTR/STRK/STRF) is the world's first and largest Bitcoin Treasury Company. We are a publicly traded company that has adopted Bitcoin as our primary treasury reserve asset. By using proceeds from equity and debt financings, as well as cash flows from our operations, we strategically accumulate Bitcoin and advocate for its role as digital capital. Our treasury strategy is designed to provide investors varying degrees of economic exposure to Bitcoin by offering a range of securities, including equity and fixed-income instruments. In addition, we provide industry-leading AI-powered enterprise analytics software, advancing our vision of Intelligence Everywhere. We leverage our development capabilities to explore innovation in Bitcoin applications, integrating analytics expertise with our commitment to digital asset growth. We believe our combination of operational excellence, strategic Bitcoin reserve, and focus on technological innovation positions us as a leader in both the digital asset and enterprise analytics sectors, offering a unique opportunity for long-term value creation.

Strategy, MicroStrategy, and Intelligence Everywhere are either trademarks or registered trademarks of MicroStrategy Incorporated in the United States and certain other countries. Other product and company names mentioned herein may be the trademarks of their respective owners.

Non-GAAP Financial Measures

Strategy is providing supplemental financial measures for (i) non-GAAP loss from operations that excludes the impact of share-based compensation expense, and (ii) non-GAAP net loss attributable to common stockholders and non-GAAP diluted loss per common share that exclude the impacts of share-based compensation expense, interest expense arising from the amortization of debt issuance costs related to Strategy’s long-term debt, gains and losses on debt extinguishment, if any, and related income tax effects. These supplemental financial measures are not measurements of financial performance under GAAP and, as a result, these supplemental financial measures may not be comparable to similarly titled measures of other companies. Management uses these non-GAAP financial measures internally to help understand, manage, and evaluate business performance and to help make operating decisions.

Strategy believes that these non-GAAP financial measures are also useful to investors and analysts in comparing its performance across reporting periods on a consistent basis. The first supplemental financial measure excludes a significant non-cash expense that Strategy believes is not reflective of its general business performance, and for which the accounting requires management judgment and the resulting share-based compensation expense could vary significantly in comparison to other companies. The second set of supplemental financial measures excludes the impacts of (i) share-based compensation expense, (ii) non-cash interest expense arising from the amortization of debt issuance costs related to Strategy’s long-term debt, (iii) gains and losses on debt extinguishment, if any, and (iv) related income tax effects. Strategy believes the use of these non-GAAP financial measures can also facilitate comparison of Strategy’s operating results to those of its competitors.

Important Information About KPIs

BTC Yield is a key performance indicator (“KPI”) that represents the percentage change, during a period, of the ratio between the Company’s bitcoin holdings and its Assumed Diluted Shares Outstanding, where:

• “Assumed Diluted Shares Outstanding” refers to the aggregate of our Basic Shares Outstanding as of the dates presented plus all additional shares that would result from the assumed conversion of all outstanding convertible notes and convertible preferred stock, exercise of all outstanding stock option awards, and settlement of all outstanding restricted stock units and performance stock units as of such dates. Assumed Diluted Shares Outstanding is not calculated using the treasury method and does not take into account any vesting conditions (in the case of equity awards), the exercise price of any stock option awards or any contractual conditions limiting convertibility of convertible debt instruments.
• “Basic Shares Outstanding” reflects the actual class A common stock and class B common stock outstanding as of the dates presented. For purposes of this calculation, outstanding shares of such stock are deemed to include shares, if any, that were sold under at-the-market equity offering programs that were to be issued pursuant to options that had been exercised or restricted stock units that have vested or that were to be issued with respect to conversion requests received with respect to convertible securities, but which in each case were pending issuance as of the dates presented.

BTC Gain is a KPI that represents the number of bitcoins held by the Company at the beginning of a period multiplied by the BTC Yield for such period.

BTC $ Gain is a KPI that represents the dollar value of the BTC Gain calculated by multiplying the BTC Gain by the market price of bitcoin. For determining BTC $ Gain QTD and YTD, unless otherwise specified, the Company uses the current market price of bitcoin. For determining BTC $ Gain for a past fiscal year or other past period, the Company uses the market price of bitcoin as of 4:00pm ET as reported on the Coinbase exchange on the last day of the applicable period. The Company uses these market prices of bitcoin for this calculation solely for the purpose of facilitating this illustrative calculation.

The Company uses BTC Yield, BTC Gain and BTC $ Gain as KPIs to help assess the performance of its strategy of acquiring bitcoin in a manner the Company believes is accretive to shareholders. The Company believes these KPIs can be used to supplement an investor’s understanding of the Company’s decision regarding the manner in which it funds the purchase of bitcoin and the value created in a period by:

• in the case of BTC Yield, comparing the rate of change in the Company’s bitcoin holdings as compared to the rate of change in the number of shares of its common stock and instruments convertible to common stock;
• in the case of BTC Gain, hypothetically expressing the change reflected in the BTC Yield metric as if it reflected an increase in the amount of bitcoin held at the end the applicable period as compared to the beginning of such period;
• in the case of BTC $ Gain, further expressing that gain as a dollar value by multiplying that bitcoin-denominated gain by the market price of bitcoin at the end of the applicable period as described above; and

When the Company uses these KPIs, management takes into account the various limitations of these metrics, including that they

• do not take into account debt, preferred stock and other liabilities and claims on company assets that would be senior to common equity; and
• assume that all indebtedness will be refinanced or, in the case of the Company’s senior convertible debt instruments and convertible preferred stock, converted into shares of common stock in accordance with their respective terms.

BTC Yield, BTC Gain and BTC $ Gain are not, and should not be understood as, operating performance measures or financial or liquidity measures. Specifically:

• BTC Yield is not equivalent to “yield” in the traditional financial context. It is not a measure of the return on investment the Company’s shareholders may have achieved historically or can achieve in the future by purchasing stock of the Company, or a measure of income generated by the Company’s operations or its bitcoin holdings, return on investment on its bitcoin holdings, or any other similar financial measure of the performance of its business or assets.
• BTC Gain and BTC $ Gain are not equivalent to “gain” in the traditional financial context. They also are not measures of the return on investment the Company’s shareholders may have achieved historically or can achieve in the future by purchasing stock of the Company, or measures of income generated by the Company’s operations or its bitcoin holdings, return on investment on its bitcoin holdings, or any other similar financial measure of the performance of its business or assets. It should also be understood that BTC $ Gain does not represent a fair value gain of the Company’s bitcoin holdings, and BTC $ Gain may be positive during periods when the Company has incurred fair value losses on its bitcoin holdings.

The trading price of the Company’s class A common stock is informed by numerous factors in addition to the amount of bitcoins the Company holds and number of actual or potential shares of its class A common stock outstanding, and as a result, the market value of the Company’s securities may trade at a discount or a premium relative to the market value of the bitcoin the Company holds, and neither BTC Yield, BTC Gain nor BTC $ Gain are indicative or predictive of the trading price of the Company’s securities.

As noted above, these KPIs are narrow in their purpose and are used by management to assist it in assessing whether the Company is raising and deploying capital in a manner accretive to shareholders solely as it pertains to its bitcoin holdings.

In calculating these KPIs, the Company does not consider the source of capital used for the acquisition of its bitcoin. Specifically, the Company notes it has acquired bitcoin using proceeds from the offerings of

• non-convertible instruments, such as its 6.125% Senior Secured Notes due 2028 (which the Company has since redeemed) and 10.00% Series A Perpetual Strife Preferred Stock; and
• convertible senior notes and convertible preferred stock, which, at the time of issuance had, and may from time-to-time have, conversion prices above the current trading prices of the Company’s common stock, or, in the case of convertible senior notes, conversion rights that are not then exercisable.

The use of the proceeds from such offerings to purchase bitcoin has the effect of increasing the BTC Yield, BTC Gain and BTC $ Gain, while also increasing the Company’s indebtedness and senior claims of holders of instruments other than class A common stock with respect to dividends and to the Company’s assets, including its bitcoin, in a manner that is not reflected in these metrics.

If any of the Company’s convertible notes mature or are redeemed without being converted into common stock, or if the Company elects to redeem or repurchase its non-convertible instruments, the Company may be required to sell shares of its class A common stock or bitcoin to generate sufficient cash proceeds to satisfy those obligations, either of which would have the effect of decreasing BTC Yield, BTC Gain and BTC $ Gain, and adjustments for such decreases are not contemplated by the assumptions made in calculating these metrics. Accordingly, these metrics might overstate or understate the accretive nature of the Company’s use of capital to buy bitcoin because not all bitcoin is purchased using proceeds of issuances of class A common stock, and not all proceeds from issuances of class A common stock are used to purchase bitcoin.

In addition, we are required to pay dividends with respect to our Perpetual Strike Preferred Stock and Perpetual Strife Preferred Stock in perpetuity. We could pay these dividends with cash or, in the case of Perpetual Strike Preferred Stock, by issuing shares of class A common stock. If we issue shares of class A common stock in lieu of paying dividends in cash, or if we issue shares of class A common stock for cash to fund the payment of cash dividends, then we would experience an increase in our Assumed Diluted Shares Outstanding without a corresponding increase in our bitcoin holdings, resulting in a decrease in BTC Yield, BTC Gain and BTC $ Gain for the period in which such sales of bitcoin or issuance of shares of class A common stock occurred.

The Company has historically not paid any dividends on its shares of class A common stock, and by presenting these KPIs the Company makes no suggestion that it intends to do so in the future. Ownership of the Company’s securities, including its class A common stock and preferred stock, does not represent an ownership interest in the bitcoin the Company holds.

The Company determines its KPI targets based on its history and future goals. The Company’s ability to achieve positive BTC Yield, BTC Gain, or BTC $ Gain may depend on a variety of factors, including its ability to generate cash from operations in excess of its fixed charges and other expenses, as well as factors outside of its control, such as the price of bitcoin, and the availability of debt and equity financing on favorable terms. Past performance is not indicative of future results.

Investors should rely on the financial statements and other disclosures contained in the Company’s SEC filings. These KPIs are merely supplements, not a substitute. They should be used only by sophisticated investors who understand their limited purpose and many limitations.

Forward-Looking Statements

This press release may include statements that may constitute “forward-looking statements,” including estimates of future business prospects or financial results, our targets relating to our BTC Yield, BTC Gain and BTC $ Gain KPIs, and statements containing the words “believe,” “estimate,” “project,” “expect,” “will,” or similar expressions. Forward-looking statements inherently involve risks and uncertainties that could cause actual results of MicroStrategy Incorporated and its subsidiaries (collectively, the “Company”) to differ materially from the forward-looking statements. Factors that could contribute to such differences include: fluctuations in the market price of bitcoin and any associated unrealized gains or losses on digital assets that the Company may record in its financial statements as a result of a change in the market price of bitcoin from the value at which the Company’s bitcoins are carried on its balance sheet; the availability of debt and equity financing on favorable terms; gains or losses on any sales of bitcoins; changes in the accounting treatment relating to the Company’s bitcoin holdings; changes in securities laws or other laws or regulations, or the adoption of new laws or regulations, relating to bitcoin that adversely affect the price of bitcoin or the Company’s ability to transact in or own bitcoin; the impact of the availability of spot exchange traded products and other investment vehicles for bitcoin and other digital assets; a decrease in liquidity in the markets in which bitcoin is traded; security breaches, cyberattacks, unauthorized access, loss of private keys, fraud or other circumstances or events that result in the loss of the Company’s bitcoins; impacts to the price and rate of adoption of bitcoin associated with financial difficulties and bankruptcies of various participants in the digital asset industry; the level and terms of the Company’s substantial indebtedness and its ability to service such debt; the extent and timing of market acceptance of the Company’s new product offerings; continued acceptance of the Company’s other products in the marketplace; the Company’s ability to recognize revenue or deferred revenue through delivery of products or satisfactory performance of services; the timing of significant orders; delays in or the inability of the Company to develop or ship new products; customers continuing to shift from a product license model to a cloud subscription model, which may delay the Company’s ability to recognize revenue; fluctuations in tax benefits or provisions; changes in the market price of bitcoin as of period-end and their effect on our deferred tax assets, related valuation allowance, and tax expense; other potentially adverse tax consequences, including the potential taxation of unrealized gains on our bitcoin holdings; competitive factors; general economic conditions, including levels of inflation and interest rates; currency fluctuations; and other risks detailed in the Company’s registration statements and periodic and current reports filed with the Securities and Exchange Commission (“SEC”). The Company undertakes no obligation to update these forward-looking statements for revisions or changes after the date of this release.

MICROSTRATEGY INCORPORATED

SEGMENT INFORMATION

(in thousands, unaudited)

The Company has one reportable operating segment, the “Software Business,” which is engaged in the design, development, marketing, and sales of the Company’s enterprise analytics software platform through cloud subscriptions and licensing arrangements and related services (i.e., product support, consulting and education). The “Corporate & Other” category presented in the following tables is not considered an operating segment. It consists primarily of costs and expenses related to executing the Company’s bitcoin strategy and includes the impairment charges and other third-party costs associated with the Company’s bitcoin holdings, net interest expense primarily related to long-term debt obligations (the net proceeds of which were primarily used to purchase bitcoin), and income tax effects generated from the Company’s bitcoin holdings and related debt issuances.

Beginning in 2025, the Company has dedicated certain corporate personnel to its bitcoin strategy, including both individuals fully dedicated to the initiative and others with responsibilities apportioned in part to support the strategy. These personnel and related costs, including related Share-based compensation expense are included within the “Corporate resources” and the “Share-based compensation expense” segment expense line items to better align with their activities and utilization. There were no other significant changes in the Company’s expense allocation methodology that affect period over period comparison during the first quarter of 2025.

The Company’s chief operating decision maker (“CODM”), is the Company’s Chief Executive Officer, who manages the entity on a consolidated basis. The CODM uses “net income (loss)” to assess the profitability of the software business by comparing actual to budgeted results on a monthly basis. In doing so, he focuses on “controllable costs” across main functions of the Software Business and will allocate personnel and budget accordingly to maximize potential profitability. The CODM also uses “net income (loss)” to understand the impact from income taxes and debt-related items for general tax and liquidity planning purposes.

The following tables present (for each of the Software Business segment and Corporate & Other category, and on a consolidated basis) the Company’s revenues and significant expenses regularly provided to the CODM, reconciled to net (loss) income (in thousands) for each of the periods presented. Total segment assets (in thousands) provided to the CODM are also disclosed in the tables below for each period presented.

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