Harvard reported a $112.6 million net operating deficit for FY25 even as its endowment and total assets grew—reflecting an unprecedented financial strain tied to federal actions that have frozen or curtailed research reimbursements. The university says an abrupt termination of federally sponsored research reimbursements and grant suspensions materially affected operating cash flows. Harvard’s leadership framed the shortfall as the product of political interference in research funding and regulatory maneuvers that threaten patent and research autonomy. Donors and investment returns sustained overall asset growth, but the operating gap highlights vulnerabilities for institutions heavily reliant on federal research dollars. Universities watching Harvard’s disclosures will weigh contingency plans for grant disruptions, insurance for research revenue risk, and the governance tradeoffs of negotiating with federal agencies under political pressure.