Strategy, the largest corporate holder of Bitcoin, is facing a mixed financial outlook for the second quarter of 2025. While the company is projected to report substantial unrealized gains from its Bitcoin holdings, its core software business is expected to show stalled revenue. This divergence highlights the increasing gap between Strategy's digital asset investments and its operational performance.

Bloomberg analysis indicates that Strategy could reveal over $13 billion in unrealized gains for the second quarter of 2025, fueled by its significant cryptocurrency assets. This surge in unrealized gains is primarily due to the increasing price of Bitcoin, in which Strategy has heavily invested. As of March 31, Strategy held 528,185 Bitcoins, valued at over $43.5 billion at the time. By the end of June, these holdings had risen to $56.3 billion, resulting in an unrealized gain of $12.8 billion over the past three months.

However, Strategy's core software business is expected to generate only $112.8 million in revenue. This relatively small revenue figure underscores the company's increasing reliance on Bitcoin for its financial performance. Once primarily an enterprise software firm, Strategy has transitioned into a leveraged investment in Bitcoin, allowing investors exposure to the cryptocurrency without direct ownership.

Strategy's commitment to Bitcoin is evident in its recent purchases. The company acquired 4,980 Bitcoins for $531.9 million between June 23 and June 29, at an average price of $106,801 per Bitcoin. This acquisition increased Strategy's total holdings to 597,325 Bitcoins, acquired for approximately $42.4 billion. These purchases were financed through the sale of common stock and newly issued preferred stocks.

Michael Saylor, Strategy's Executive Chairman, has consistently advocated for Bitcoin as a strategic reserve asset. His strategy involves issuing securities to acquire more Bitcoin, aiming to increase its scarcity and price. Saylor believes this approach could transform traditional credit markets and potentially drive Bitcoin's price to $3 million.

Despite the potential for substantial gains, Strategy's stock price experienced a 6% drop on Tuesday. However, it has still soared over 170% in the past year, reflecting investor confidence in the company's Bitcoin strategy. Benchmark analyst Mark Palmer noted that Strategy's Bitcoin yield was 19.7% between January 1 and June 29.

The company's Bitcoin holdings have also drawn attention from the broader financial community. Other companies have followed Strategy's lead, adding Bitcoin to their balance sheets as the cryptocurrency's price has increased. As of June 2025, 250 businesses held Bitcoin, with 26 announcing BTC treasury strategies in June alone.

However, some analysts suggest that the increasing number of companies holding Bitcoin may not be sustainable. A VC report has predicted that few Bitcoin treasury companies will survive a potential "death spiral". Concerns have also been raised about the potential impact of long-term holders selling Bitcoin, which could offset the demand from institutional investors and limit price growth.