In the early hours of Nov. 3, the Islamic State group's leader, Abu Bakr al-Baghdadi, released his first statement in nearly a year — a defiant message that the group will not fade away quietly, even as Iraqi special forces breached the outskirts of Mosul, the last major city in Iraq under Islamic State's control.

Baghdadi tried to project confidence that his jihadists would beat back the Iraqi government's advance. "This total war and the great jihad that the Islamic State is fighting today only increases our conviction that all of this is a prelude to victory," he said in an audio recording.

But despite his bluster and attempt to boost morale for the fight in Mosul, Baghdadi's message also signaled the latest transformation for IS as it loses the core of its self-proclaimed caliphate in Iraq and Syria. Two years ago, Baghdadi reveled in IS' quick expansion; he declared himself caliph and "leader of Muslims everywhere." Today, under pressure from advancing ground forces and U.S.-led air strikes, Baghdadi is looking beyond the caliphate.