Strategy posts $12.5B Q1 loss on $14.5B Bitcoin write-down

Strategy Inc. reported a $12.54 billion net loss for the first quarter of 2026, almost entirely due to a $14.46 billion unrealized loss on its Bitcoin holdings. The company recorded an operating loss of $14.47 billion, compared with $5.92 billion a year earlier.

As of May 3, Strategy held 818,334 BTC, up about 22% year to date. The holdings had a market value of roughly $66.8 billion and an original cost basis near $61.81 billion, with an average purchase price of about $75,537 per coin. The unrealized loss reflected a drop in Bitcoin’s price during the quarter; Bitcoin later traded in the low $80,000s and reached its highest level since January.

The company reported $11.68 billion in gross proceeds in 2025 to fund further Bitcoin purchases. Its newer preferred-equity product, STRC, raised $5.58 billion year over year, a 189% increase. Strategy said STRC’s daily trading volume rose to about $375 million while volatility fell to roughly 3%.

Strategy completed 23 consecutive on-time dividend distributions on its preferred equity products, totaling more than $693 million since those instruments launched in early 2025. The company has proposed a shareholder vote to double STRC’s dividend payment frequency to a semi-monthly schedule, which it said could improve liquidity and price stability for the securities.

On public markets, Strategy’s common stock (MSTR) finished a recent trading day at $186.90, up about 1.7% for the day and nearly 56% over the prior month. Shares remain down more than 51% over the past year after trading above $400 last summer.

Outside of its Bitcoin holdings, Strategy’s software business generated $124.3 million in revenue for the quarter, an 11.9% increase year over year, with a gross margin of 67.1%. The company previously reported a $12.4 billion net loss in Q4 2024.

Derivatives markets showed a divergence during the recovery: funding rates on perpetual Bitcoin contracts stayed negative for an extended period even as spot prices rose, a pattern that indicates mixed sentiment across cash and futures markets.

In its release, Strategy quoted President and CEO Phong Le: “Adoption of Bitcoin continues to grow in 2026. Digital credit, highlighted by STRC, has been a big success. STRC has shown strong demand, high liquidity, and low volatility. We raised $5.6 billion year-to-date of STRC gross proceeds, increased daily trading volume to $375 million, while bringing volatility down to 3%, all done during a Bitcoin bear market.”