Strategy has announced a $42 billion capital plan split between equity and fixed income, to expand its Bitcoin holdings and raise its BTC yield target for 2025.
This comes despite recently reporting a record $4.2 billion first-quarter loss. The loss came after the firm adopted a new accounting rule requiring Bitcoin to be valued at market prices.
Nevertheless, the company remains committed to increasing its Bitcoin exposure. This latest expansion move includes a $21 billion common share sale and a $21 billion fixed income issuance, together forming a $42 billion capital plan. With these efforts, the firm appears committed to deepening its position as a Bitcoin-focused enterprise.
Strategy announces BTC Yield of 13.7% and BTC $ Gain of $5.8B year-to-date, doubles capital plan to $42B equity and $42B fixed income to purchase bitcoin, and increases BTC Yield target from 15% to 25% and BTC $ Gain target from $10B to $15B. $MSTR $STRK $STRF
— Strategy (@Strategy) May 1, 2025
Accounting Change Drives Record Loss
The first-quarter loss followed Strategy’s adoption of an accounting change approved in late 2023. This shift, under ASU 2023-08, requires firms to reflect unrealized changes in the value of their Bitcoin holdings in their earnings.
Previously, the company had classified Bitcoin as intangible assets, a designation that restricted recognition of gains unless the assets were sold, while losses were recorded permanently when values dropped. With the new rule now in effect, Strategy reported a significant unrealized loss due to a quarter-end Bitcoin price of $82,445.
However, the company has emphasized that its current position has since improved. Based on an approximate Bitcoin price of $97,300, Strategy estimates a fair value gain of about $8 billion for the second quarter so far. This swing reflects the volatility introduced by the updated accounting standards, which now affect firms holding large quantities of digital assets.
Equity and Debt Programs Expanded
Strategy’s latest fundraising plan includes a $21 billion equity sale, following the full utilization of a similar-sized program initiated in October. In tandem, the company announced a $21 billion fixed income issuance, bringing the total capital plan to $42 billion.
These moves indicate Strategy’s intent to build on its current Bitcoin portfolio, which stands at 553,555 BTC.
According to Benchmark analyst Mark Palmer, increasing Bitcoin demand by corporate buyers could further enhance Strategy’s market position. He noted that firms mimicking Strategy’s balance sheet strategy might indirectly contribute to rising Bitcoin prices, which could benefit Strategy’s valuation. However, this potential effect remains subject to market conditions and other external variables.
Strategy’s Early-Year Bitcoin Performance
Despite the first-quarter loss, Strategy reported a robust start to 2025, driven by a 13.7% year-to-date BTC yield. The company also posted a $5.8 billion Bitcoin gain, representing 58% of its annual target.
This performance reflects strong returns on its crypto holdings, even amid accounting-driven volatility. CFO Andrew Kang highlighted that these figures cover over 90% of the firm’s 2025 yield target within the first four months.
Meanwhile, Strategy’s stock performance continues to reflect investor interest, having surged nearly 3,000% since 2020.
$MSTR is now up more than 3000% since adopting the Bitcoin Standard. pic.twitter.com/ZqBKMHG999
— Michael Saylor (@saylor) May 1, 2025
However, David Trainer of New Constructs cautioned that Strategy’s transformation followed a period of stagnation and that the sustainability of this approach remains uncertain.
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