Strategy announces the issuance of $2 billion convertible bonds to support future Bitcoin purchases

According to The Block, Strategy (formerly MicroStrategy) announced on Tuesday that it plans to issue $2 billion in zero interest convertible senior bonds, hours after issuing a profit warning. Strategy Company plans to use the proceeds from this issuance for general corporate purposes, including the acquisition of Bitcoin. Unless repurchased, redeemed, or converted in advance, these bonds will mature on March 1, 2030. According to the announcement, Strategy Company will settle the conversion in cash, Class A common stock, or a combination of both. Strategy also plans to grant initial buyers the option to purchase up to $300 million in additional bonds within five working days after issuance. Earlier on Tuesday, Strategy issued a profit warning in its 10-K filing with the US SEC due to potential tax burden increases. Strategy reviewed the net loss for the fiscal year ending December 31, 2024, primarily due to a $1.79 billion impairment loss on digital assets. The company warns that it may not be able to restore profitability 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 may have a negative impact on the company's debt paying ability. Strategy stated 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 largely depends on the market value of its Bitcoin holdings, and a significant decline in Bitcoin value may trigger liquidity risks, which could force companies to sell Bitcoin at unfavorable prices. The company explained that this may have a significant impact on its financial performance and future financing prospects. Strategy acquired approximately 258320 BTC in 2024. After the latest acquisition between February 3rd and 9th, 2025, the company currently holds 478740 BTC worth over $46 billion.