Strategy Posts $12.5B Q1 Loss as BTC Prices Weigh on Results

Michael Saylor said Strategy may have to sell some of its Bitcoin to pay a dividend and “inoculate the market.”

The world’s largest corporate Bitcoin (BTC) holder, Strategy, yesterday released its Q1 2026 financial results, which show a net loss of $12.54 billion.

According to the report, this was mostly due to a $14.46 billion unrealized loss stemming from poor BTC prices during the first few months of 2026.

Losses Mount, But Accumulation Continues

Operating loss was $14.47 billion, compared with $ 5.92 billion in the prior year. Loss for the quarter attributable to common stockholders was $12.77 billion, or $38.25 per diluted share, whereas a year earlier, it was $4.23 billion.

However, if you strip out the Bitcoin accounting, the underlying software business held relatively steady, with total revenues growing 11.9% year-over-year to $124.3 million, while gross profit came in at $83.4 million.

Furthermore, the company’s actual BTC position kept growing through the quarter. Strategy bought 89,599 BTC in Q1, bringing its total holdings to 818,334 BTC, which is a 22% increase year to date.

The company has raised nearly $12 billion in capital markets activity so far in 2026, including $7.37 billion in Q1 alone through its at-the-market offering program spanning MSTR shares and its preferred stock instruments.

The preferred equity side of the business was a particular focus on the call. STRC, Strategy’s variable-rate preferred stock, has now scaled to $8.5 billion in notional value in just nine months, which the company described as the largest preferred stock by market cap in the world.

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According to CFO Andrew Kang, the cumulative dividends declared and paid across all instruments have now crossed $693 million across 23 consecutive distributions.

The Bitcoin Sale Question

One of the biggest takeaways from the earnings call was Executive Chairman Michael Saylor’s suggestion that Strategy could sell some of its BTC stash to cover dividend obligations.

“We will probably sell some Bitcoin to pay a dividend just to inoculate the market and send the message that we did it,” he said.

The statement was notable because Saylor has spent years evangelizing BTC as an asset you never sell, and analyst Jeff Park, who participated in the call, flagged the comment as more material than the company’s previous discussions on the subject.

Park also pointed out that Strategy’s exposure to US interest rates is becoming more relevant given STRC’s nature as a floating instrument, especially when you consider the approaching tenure of Kevin Warsh as Federal Reserve chair and the prospect of rate cuts on the table.

A couple of weeks ago, Bitcoin skeptic Peter Schiff held a live X Space, where he called STRC “an obvious Ponzi scheme” and argued that the company had no meaningful income outside its software division and therefore funds dividend payouts by continuously issuing new STRC shares.

Strategy has pushed back on that characterization, pointing to its BTC holdings as a balance sheet backstop.

MSTR shares closed at around $187, down roughly 3.5% in after-hours trading following the earnings release. STRC, meanwhile, is trading just below $100 with an effective annualized yield of 11.5%, with Bitcoin itself holding at around $81,000 at the time of writing.