MSTR · Forward model · Product support
What has to happen in Product support
Model as of
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Product support
The annuity being cannibalised. On-premise maintenance revenue has fallen in every quarter but two since March 2023, from $65.5m to $40.2m, and the decline is accelerating: 8.9% sequentially in each of the last two quarters against 1.8% and 0.9% a year earlier. Customers leaving this line mostly reappear in subscription services, which is why consolidated revenue has been flat while both lines moved violently. It carries the highest gross margin in the company at 86.0%, so its decline costs more profit than its revenue suggests - and it cannot fall at 9% a quarter forever, because what is left at the end is the on-premise core that will not move to cloud at any price.
Latest: $16M (2031Q2E)
| Period | Value |
|---|---|
| 2023Q1 | $65M |
| 2023Q2 | $66M |
| 2023Q3 | $67M |
| 2023Q4 | $65M |
| 2024Q1 | $63M |
| 2024Q2 | $62M |
| 2024Q3 | $61M |
| 2024Q4 | $58M |
| 2025Q1 | $53M |
| 2025Q2 | $52M |
| 2025Q3 | $51M |
| 2025Q4 | $48M |
| 2026Q1 | $44M |
| 2026Q2 | $40M |
| 2026Q3E | $37M |
| 2026Q4E | $34M |
| 2027Q1E | $32M |
| 2027Q2E | $30M |
| 2027Q3E | $28M |
| 2027Q4E | $27M |
| 2028Q1E | $26M |
| 2028Q2E | $24M |
| 2028Q3E | $23M |
| 2028Q4E | $22M |
| 2029Q1E | $22M |
| 2029Q2E | $21M |
| 2029Q3E | $20M |
| 2029Q4E | $19M |
| 2030Q1E | $19M |
| 2030Q2E | $18M |
| 2030Q3E | $17M |
| 2030Q4E | $17M |
| 2031Q1E | $16M |
| 2031Q2E | $16M |
Assumptions & reasoning
- Eleven quarters are printed on the face of a filing. The three marked estimated are fourth quarters derived as the 10-K full year less the nine months in that year's third-quarter 10-Q: 263,888 - 198,422, 243,805 - 185,440 and 204,225 - 155,728.
- Highest gross margin in the company at 86.0% - $5,634 thousand of cost on $40,245 thousand of revenue - so each dollar lost here costs roughly 1.35x the gross profit of a dollar of subscription revenue.
- The run-off is long-running rather than new, and the annual figures show it without any derivation at all: $266.5m in 2022, $263.9m in 2023, $243.8m in 2024, $204.2m in 2025.
- The centred four-quarter moving-average test formally passes on this line - a signal of 0.0474 against a worst window spread of 0.0286 - and seasonality is still not applied. The apparent Q1 trough rests on two observations, 0.9878 and 0.9593, that are moving apart rather than repeating, which is an accelerating decline contaminating the ratio rather than an annual shape. Maintenance revenue is recognised ratably and no mechanism is disclosed.