Strategy (MSTR) Status Update summary

Bitcoin Holdings and Financial Guidance

• Increased Bitcoin holdings to 650,000, with a net asset value of $59 billion.

• FY2025 guidance assumes a year-end bitcoin price range of $85,000 to $110,000, impacting BTC dollar gain and GAAP earnings.

• BTC yield percentage expected to end the year between 22% and 26%, below the original 30% target.

• BTC dollar gain now projected at $8.4–$12.8 billion, down from the original $20 billion target.

• Operating income for FY2025 is projected between $(7.0) billion and $9.5 billion; net income between $(5.5) billion and $6.3 billion; diluted EPS between $(17.0) and $19.0.

Capital Structure and Reserves

• Enterprise value stands at $68 billion, with a BTC reserve of $59 billion and a 1.2x mNAV.

• Convertible debt totals $8.2 billion and preferred equity $7.8 billion, resulting in a conservative 22–23% loan-to-value.

• A $1.44 billion USD reserve has been established to cover at least 12 months of dividends, currently covering 21 months, with a goal of 24 months or more.

• The reserve is funded by class A common stock sales and is managed at management's discretion based on market and liquidity needs.

• The reserve aims to smooth volatility and reinforce commitment to credit investors and shareholders.

Digital Credit Model and Risk Management

• BTC rating is 3.7, with digital credit spreads offering significant premiums over model rates.

• USD reserve reduces risk and allows dynamic management of dividend obligations.

• Can fund dividends for 1.75 years from USD reserve or 74 years from BTC reserve at 0% appreciation.

• BTC escape velocity is 10.3% annual appreciation; cruise speed for continuous value creation is 1.4%.

• Earnings results are highly sensitive to bitcoin price fluctuations due to fair value accounting for crypto assets.