Strategy Reports $10 Billion Q2 Profit, Launches $4.2 Billion Preferred Stock Offering to Acquire More Bitcoin

Introduction

Strategy Inc.—formerly known as MicroStrategy—reported a breathtaking $10 billion net income for the second quarter of 2025, due primarily to a strong recovery in Bitcoin’s price. In a new SEC filing, the company indicated plans to obtain $4.2 billion through a new STRC preferred stock offering, with the intent of increasing its already extensive Bitcoin holdings.

Q2 Financial Breakthrough

In Q2 2025, Strategy posted $114.5 million in revenue, modestly higher than last year’s figure, but far more attention-grabbing was its $14 billion in operating income, fuelled entirely by a $14 billion unrealized gain in its Bitcoin holdings—thanks to recent accounting rules that now allow such gains to be recognized on the financial statements. That dramatic swing led to a net profit of about $10.0 billion ($32.60 per share), reversing a loss of over $100 million in Q2 2024.
Despite these record results, shares dipped slightly after-hours, with executives noting the company remains one of the most “misunderstood and undervalued” stocks in the market, according to CEO Phong Le.

Bitcoin Strategy in Full Swing

As of June 30, Strategy held 597,325 bitcoins, up nearly 20% from 499,000 at the end of Q1. By early July, that number increased to 628,791 BTC, representing roughly 3% of the total Bitcoin supply, with a total cost basis of around $46 billion—yet valued at approximately $73 billion at then current prices. The firm reported a year to date Bitcoin “yield” of 25%, outpacing its initial target, and has now raised its full year yield target to 30%.
Strategy’s model—raising capital via preferred and common stock offerings, as well as debt financing to accumulate BTC—is regarded as pioneering the corporate “Bitcoin treasury” approach. This model has inspired a wave of similar firms in 2025.

$4.2 Billion STRC Offering: What It Means

On July 31, Strategy filed paperwork with the U.S. Securities and Exchange Commission to raise up to $4.2 billion by issuing a new series of perpetual preferred stock (STRC). The offering follows closely on the heels of an earlier $2.5 billion STRC issuance, whose proceeds funded the purchase of about 21,000 BTC, making it Strategy’s largest preferred stock deal to date.
The STRC shares pay a variable dividend, initially around 9–10%, with the structure and issuance being carefully managed “at the market” to avoid flooding supply and to keep market price near par.

Market Response and Outlook

Analysts remain enthusiastic. TD Cowen analysts have raised their target price for Strategy’s stock to $680, citing expected upside potential as dilution is controlled given current mNAV (market to net asset value) remaining below the 2.5x issuance threshold.
Investors, meanwhile, are watching the growing trend of corporate Bitcoin treasuries—a surge accelerated by supportive regulatory moves, including the U.S. “GENIUS Act” and broader political endorsement of digital assets, pushing Bitcoin past $120,000 in July.

Strategic Takeaways

1. Massive Profit Shift: Strategy swung to a $10 billion net profit in Q2 after accounting rule changes enabled recognition of unrealized gains.
2. Adding to Bitcoin Holdings: The company now owns approximately 628,800 BTC, financed through capital markets completely to fund accumulation.
3. Aggressive Capital-Raising Plans: The recent $4.2 billion STRC currency issuance is the most recent milestone in an ambitious long term “42/42” strategy to raise $42 billion by 2027 to build its crypto treasury.
4. Regulatory and Market Momentum: With increased clarity and support from U.S. policymakers and increased demand from investors for corporate engagement in crypto strategies, Strategy is continuing to find itself at the leading edge of the institutional Bitcoin movement.

Conclusion

Strategy’s Q2 outcomes represent a watershed moment in corporate finance history—not only did it reverse its bottom line, it cemented its place within the framework of being a Bitcoin treasury machine. With fresh funding lined up via STRC, and Bitcoin’s price trajectory showing strength, Strategy appears set to continue scaling its crypto position. What remains is whether the market—and critics—will reprice the company more in line with the value of its Bitcoin holdings.