Let's talk about MSTR's Q3 2025 financial report.

2025-10-31 10:31:19

Author: Phyrex Source: X, @Phyrex_Ni

To begin with, after the U.S. stock market closed on Thursday, MSTR released its earnings report, with earnings per share of $8.42, exceeding market expectations of $7.90. The third quarter revenue was $128.7 million, while the market expectation was $118.3 million. MSTR's third quarter earnings report surpassed market expectations, and the after-hours price rose by over 5%.

As of October 26, 2025, MSTR holds a total of 640,808 coins of $BTC , with a total cost of 47.44 billion USD, equivalent to a cost of 74,032 USD per Bitcoin. The current BTC price is 107,300 USD, resulting in an unrealized profit of 21.333 billion USD. Among them, the net profit (unrealized) for the third quarter is 2.8 billion USD.

What is this concept?

American Express, which is in the S&P 500, is also ranked 67th globally in assets, with a profit of $2.9 billion in the third quarter of 2025. Another well-known tech company, Oracle, reported a GAAP net profit of $2.9 billion in the third quarter.

This doesn't mean that MSTR is particularly impressive; MSTR received a junk bond rating of B- in the latest S&P ratings primarily due to the high volatility of Bitcoin's price. Therefore, I feel that S&P's rating of MSTR is essentially a rating of BTC, with the only difference being that BTC can be rated one or two levels higher due to the absence of leverage.

Therefore, MSTR's net profit (on paper) has basically met the standards of the top 100 companies in the world, which is mainly attributed to the price of BTC.

Crisis?

As of September 30, 2025, MSTR holds cash and cash equivalents of $54.3 million, does that mean it can only buy $54.3 million worth of Bitcoin?

No, MSTR does not buy BTC with cash; it buys BTC through its capital structure by issuing stocks, bonds, and structured credit to convert fiat currency into BTC.

In reality, the financial report for the third quarter of 2025 indicates that as of October 26, 2025, MSTR has a remaining issuance limit of approximately $42.1 billion through multiple ATM programs, meaning that MSTR can buy Bitcoin worth up to $42.1 billion.

So why did MSTR slow down its BTC purchases in the third quarter?

MSTR divides the Common Stock ATM Program (with a remaining capacity of approximately $15.9 billion) into three tranches, determining the issuance intensity and usage based on mNAV levels:

A. mNAV threshold < 2.5x tactical issuance

Pay debt interest
Preferred Stock Dividend
Other companies have favorable conditions (such as small cash supplements).

Limited issuance scale to avoid excessive dilution at low premiums.

B. mNAV threshold 2.5x - 4.0x opportunistic issuance, mainly used for purchasing Bitcoin. Depending on market opportunities, balance financing with BTC yield.

C. mNAV threshold > 4.0x actively issues large-scale purchases of Bitcoin. Accelerate during high premiums to maximize leverage effects.

Currently, mNAV is 1.27x (below 2.5x), so MSTR may only be used for debt/dividend payments, rather than making large purchases of BTC. This explains the slowdown in buying in the third quarter (only 2.2 billion dollars).

What is the calculation formula for mNAV?

The mNAV of MSTR is the multiple of enterprise value (EV) divided by the net asset value of held Bitcoin (Bitcoin NAV).

Enterprise Value (EV): The total value of the company, including market capitalization + debt + preferred stock nominal value - cash.

Bitcoin NAV: The market value of Bitcoin held by the company (currently about 640,000 BTC, worth over 7 billion USD).

Will MSTR crash?

Short-term (2026) probability is low: unless BTC drops more than 50%, the company has $42.1 billion in ATM capacity for quick financing, and operating cash flow is stable.

Long-term (2028) moderate probability: If BTC remains sluggish in the long term, there will be significant pressure from maturing debts (the first large amount due in 2028). Statistics indicate that unless $BTC falls below $16,500, the risk of bankruptcy is highest.

In fact, the price of BTC is not the main reason why MSTR might go bankrupt. If MSTR is really going to go bankrupt, the core reason should be that MSTR cannot continue to print shares to exchange for BTC. As long as the market still recognizes MSTR's method and provides financing channels for MSTR, the probability of bankruptcy for MSTR will be very low.

When is MSTR the safest?

BTC is in a fluctuating upward cycle.
Improvement in Federal Reserve liquidity or expectations of interest rate cuts
The legal capital market is willing to purchase BTC open positions.
U.S. regulatory recognition of BTC has increased
mNAV > 2.5, enterprises can continue to enhance their balance sheets.
Non-Debt Repayment Period

From my personal point of view, there is no need to consider debt repayment until 2028, meaning that almost anything regarding the price of BTC before 2028 will not cause BTC to crash. The year 2028 marks the beginning of a new major cycle, with the U.S. presidential election, the possibility of low interest rates in the U.S., and even potential quantitative easing. Liquidity is very likely to be better than it is now.

So I believe that the debt in 2028 is not an issue, and the price of BTC should also not be a problem. As the only Bitcoin asset in the US stock market, the probability of MSTR facing a major crisis in the recent cycle is still quite low.

PS: MSTR is a cycle of leveraging market confidence → driving up BTC → enhancing mNAV → increasing financing capability → buying BTC again. This is a Soros-style reflexivity model, not an asset-backed model.

BTC1.88%

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