PANews reported on February 19 that according to The Block, Strategy (formerly MicroStrategy) said on Tuesday that it plans to issue $2 billion in zero-interest convertible senior bonds, hours after issuing a profit warning. Strategy intends to use the proceeds from the offering for general corporate purposes, including the acquisition of Bitcoin. Unless repurchased, redeemed or converted in advance, the bonds will expire on March 1, 2030. According to the announcement, Strategy will settle the conversion in cash, Class A common stock, or a combination of the two. Strategy also plans to grant initial purchasers the option to purchase up to $300 million in additional bonds within five business days of issuance.
Earlier on Tuesday, Strategy issued a profit warning in a 10-K filing with the U.S. Securities and Exchange Commission due to a potential increase in tax liabilities. Strategy reviewed a net loss for the fiscal year ending December 31, 2024, mainly due to a $1.79 billion impairment loss on digital assets. The company warned that "profitability may not be restored in the future," especially if its Bitcoin holdings suffer significant fair value losses. It added that a significant decline in the market value of Bitcoin could have an adverse impact on the company's debt repayment ability. Strategy said that its enterprise analytics software business did not generate positive cash flow in 2024, and the company may need to rely on equity or debt financing to meet its financial obligations. The success of obtaining such financing depends largely on the market value of its Bitcoin holdings, and a significant decline in the value of Bitcoin could trigger liquidity risks, which could force the company to sell Bitcoin at unfavorable prices. The company explained that this could have a significant impact on its financial performance and future financing prospects. Strategy acquired a total of approximately 258,320 BTC in 2024. After its latest acquisition between February 3 and 9, 2025, the company now holds 478,740 BTC worth over $46 billion.
