Strategy reported a net loss of $8.22 billion for the second quarter of 2026, swinging from net income of $10.02 billion in the same period a year earlier, as a drop in bitcoin's price forced a large markdown on its holdings.
The bitcoin treasury company reported an $8.32 billion unrealized markdown on its holdings as bitcoin traded well below its average purchase price
Bloomberg / Getty Images
Strategy reported a net loss of $8.22 billion for the second quarter of 2026, swinging from net income of $10.02 billion in the same period a year earlier, as a drop in bitcoin's price forced a large markdown on its holdings.
The loss, equal to $24.45 per diluted share, was driven by an $8.32 billion unrealized loss on the company's digital assets under fair-value accounting rules. Strategy held 846,000 bitcoin as of June 30, acquired at an average cost of roughly $75,578 per coin. Bitcoin was trading at around $64,915 as of late July, leaving the company's holdings worth approximately $54.8 billion against an acquisition cost of $63.9 billion, the company said.
Quarterly revenue climbed to $122.4 million from $114.5 million in the year-ago period, a gain of roughly 6.9%. Gross profit was $81.6 million, representing a 66.6% gross margin.
The results renewed investor attention on Strategy's capital structure, which includes multiple classes of preferred stock, common equity, and convertible debt. Strategy has taken in $17.06 billion via at-the-market equity issuances so far this year and in May bought back $1.5 billion of its convertible notes at an 8% discount to face value, trimming total convertible debt outstanding from $8.21 billion to $6.71 billion.
To shore up confidence in its ability to meet obligations, Strategy accumulated a $3.75 billion cash cushion in U.S. dollars, which the company said is sufficient to service preferred dividends and interest for over two years. "Our USD Reserve currently stands at $3.75 billion, which is enough to cover our existing preferred dividend payments and interest obligations for more than 2.1 years," Chief Financial Officer Andrew Kang said in a statement.
The company also raised approximately $218.4 million by liquidating a portion of its bitcoin holdings this year through a newly introduced monetization program, using the proceeds to help cover preferred stock dividend obligations — a notable break from its historical buy-and-hold approach. Strategy separately repurchased about $25 million of its STRC preferred shares at an average price of $86.53, a roughly 13% discount to their $100 stated value, and said it intends to continue buying those securities while they trade below par.
Executive Chairman Michael Saylor pointed to the company's longer-term ambitions. "In the midst of this phase of muted bitcoin sentiment and market skepticism, we continue to evolve our business model and establish Digital Credit as a new asset class," Saylor said in a statement.
Strategy stock edged lower in after-market trading following the results.
Join 500,000+ readers who start their day with Quartz.
By subscribing, you agree to our Terms of Service and Privacy Policy.