Strategy (NASDAQ:MSTR) Issues Quarterly Earnings Results

Strategy (NASDAQ:MSTR) issued its quarterly earnings data on Thursday. The software maker reported ($24.45) EPS for the quarter, missing the consensus estimate of ($2.19) by ($22.26), FiscalAI reports. The company had revenue of $122.37 million during the quarter, compared to analysts’ expectations of $122.90 million. Strategy had a negative return on equity of 68.55% and a negative net margin of 6,102.95%.The business’s revenue for the quarter was up 6.9% compared to the same quarter last year. During the same period last year, the company earned $32.52 earnings per share.

Here are the key takeaways from Strategy’s conference call:

• Bitcoin holdings expanded significantly: Strategy held approximately 843,775 Bitcoin, acquired 83,901 during Q2, and increased Bitcoin per share by about 5% sequentially and 6% year over year.
• The company raised approximately $17 billion year to date, reduced long-term debt from $8.2 billion to $6.7 billion, and grew its cash and short-term investment reserve to $3.75 billion, providing more than two years of dividend and interest coverage.
• Q2 results were heavily affected by Bitcoin’s quarter-end price, producing an $8.6 billion net loss and negative EPS of $24.45, although management said the post-quarter recovery would imply an estimated $5.2 billion fair-value gain.
• STRC, Strategy’s flagship preferred security, was trading around $89.50 versus the company’s $99–$100 target, following a sharp June decline that management attributed to the withdrawal of leveraged credit lines and forced selling dynamics.
• Management plans to prioritize restoring STRC to par through a larger dollar reserve, potential buybacks, Bitcoin monetization, and careful dividend management, while remaining focused on consolidating its credit products rather than launching additional instruments.

Strategy Price Performance

Strategy stock traded down $4.46 during trading on Friday, reaching $93.28. The company had a trading volume of 20,621,843 shares, compared to its average volume of 15,092,008. Strategy has a 1-year low of $81.81 and a 1-year high of $414.36. The firm has a market capitalization of $32.69 billion, a PE ratio of -0.96 and a beta of 3.54. The firm’s 50-day simple moving average is $110.34 and its 200 day simple moving average is $135.03. The company has a debt-to-equity ratio of 0.22, a quick ratio of 6.05 and a current ratio of 6.05.

Analysts Set New Price Targets

MSTR has been the subject of several research reports. HC Wainwright reiterated a “buy” rating on shares of Strategy in a research note on Friday. BTIG Research reissued a “buy” rating and set a $250.00 price objective on shares of Strategy in a research note on Friday. Mizuho cut their target price on shares of Strategy from $265.00 to $213.00 and set an “outperform” rating on the stock in a research note on Tuesday, July 7th. Benchmark reaffirmed a “buy” rating and set a $435.00 price objective (down from $570.00) on shares of Strategy in a research report on Monday. Finally, Cantor Fitzgerald reiterated an “overweight” rating on shares of Strategy in a research note on Thursday, July 23rd. Two equities research analysts have rated the stock with a Strong Buy rating, twelve have given a Buy rating and four have assigned a Hold rating to the stock. According to data from MarketBeat, Strategy currently has an average rating of “Moderate Buy” and a consensus target price of $257.88.

Insider Buying and Selling at Strategy

In related news, CFO Andrew Kang sold 33,062 shares of the stock in a transaction that occurred on Friday, June 5th. The stock was sold at an average price of $118.73, for a total value of $3,925,451.26. Following the completion of the transaction, the chief financial officer directly owned 68,733 shares in the company, valued at approximately $8,160,669.09. This represents a 32.48% decrease in their ownership of the stock. The sale was disclosed in a legal filing with the SEC, which is accessible through this link. The sale was made to cover tax withholding obligations related to the vesting of equity awards. Also, Director Jarrod M. Patten sold 15,050 shares of the firm’s stock in a transaction that occurred on Friday, May 29th. The shares were sold at an average price of $154.94, for a total transaction of $2,331,847.00. Following the completion of the transaction, the director directly owned 28,000 shares of the company’s stock, valued at approximately $4,338,320. The trade was a 34.96% decrease in their position. Additional details regarding this sale are available in the official SEC disclosure. In the last ninety days, insiders have bought 11,166 shares of company stock worth $1,014,265 and have sold 181,422 shares worth $23,144,128. 6.49% of the stock is currently owned by company insiders.

Institutional Investors Weigh In On Strategy

Institutional investors and hedge funds have recently modified their holdings of the stock. Wilkerson Advisory Group LLC acquired a new stake in Strategy in the fourth quarter valued at $30,000. Binnacle Investments Inc raised its position in shares of Strategy by 492.9% during the 2nd quarter. Binnacle Investments Inc now owns 83 shares of the software maker’s stock worth $34,000 after buying an additional 69 shares in the last quarter. Quarry LP raised its holdings in shares of Strategy by 96.8% in the 4th quarter. Quarry LP now owns 246 shares of the software maker’s stock worth $37,000 after purchasing an additional 121 shares in the last quarter. Itau Unibanco Holding S.A. purchased a new position in shares of Strategy in the fourth quarter worth approximately $40,000. Finally, Wealth Watch Advisors INC purchased a new position in Strategy during the 3rd quarter valued at about $44,000. Hedge funds and other institutional investors own 59.84% of the company’s stock.

Key Headlines Impacting Strategy

Here are the key news stories impacting Strategy this week:

• Positive Sentiment: Strategy’s Bitcoin holdings increased to approximately 843,775 BTC, up about 25% year to date. The company also reported a $3.75 billion U.S. dollar reserve, intended to cover more than two years of preferred dividends and interest, reducing the risk of forced Bitcoin sales. Strategy posts Q2 loss and reserve details
• Positive Sentiment: The reported $8.22 billion loss was driven primarily by an $8.32 billion unrealized Bitcoin fair-value loss, making it largely noncash. Revenue rose 6.9% year over year to about $122.4 million, while subscription-services revenue reportedly grew sharply. BTIG reaffirmed a Buy rating and assigned a $250 price target, reflecting optimism about Bitcoin-per-share growth and Strategy’s treasury model. Strategy financials
• Neutral Sentiment: Management has authorized a $1 billion repurchase program for STRC preferred shares and bought back approximately $25 million at a discount. The move could support STRC’s price and preserve access to capital, but it diverts funds from additional Bitcoin purchases.
• Negative Sentiment: Michael Saylor indicated that Strategy could sell Bitcoin to support STRC if necessary. That possibility, combined with roughly $14.4 billion of preferred equity and investor criticism that the financing structure prioritizes preferred holders over MSTR common shareholders, heightened concerns about dilution, liquidity and downside exposure. Saylor discusses potential Bitcoin sales
• Negative Sentiment: Bitcoin’s retreat below approximately $64,000 pressured MSTR and other crypto-related stocks, reinforcing concerns that further cryptocurrency declines could produce additional accounting losses and weaken the value of Strategy’s Bitcoin-backed financing strategy. Crypto-linked stocks sell off

About Strategy

Strategy, formerly known as MicroStrategy, Incorporated (NASDAQ: MSTR) is a global provider of enterprise analytics and mobility software. The company’s flagship platform offers business intelligence, data discovery, and advanced visualizations that enable organizations to analyze large volumes of data and deliver actionable insights. In addition to traditional on-premises deployments, Strategy provides a range of cloud-based services and managed offerings that allow customers to leverage the power of its analytics tools without managing complex infrastructure.

Founded in 1989 by Michael J.