TLDR
- Strategy reported a net loss of $12.54 billion in Q1 2026, driven by a $14.46 billion unrealized markdown on its bitcoin holdings.
- Bitcoin fell from roughly $87,000 to $68,000 during the quarter, triggering the loss.
- The company now holds 818,334 BTC at an average cost of $75,537, currently worth around $66.82 billion.
- Preferred stock STRC has raised $5.58 billion year-to-date and is being positioned as a core funding tool.
- MSTR stock hit $190 on Tuesday, its highest level since mid-November, and is up nearly 20% year-to-date.
Strategy (MSTR) reported a net loss of $12.54 billion for the first quarter of 2026. The loss was almost entirely driven by a $14.46 billion unrealized markdown on its bitcoin holdings.
Strategy Earnings Hit by Bitcoin Drop 🪙$MSTR posted a heavy Q1 loss as $BTC fell sharply, but Bitcoin’s rebound above $80K could shift focus to a stronger Q2 setup 📊 pic.twitter.com/t1AU1UVFek
— CoinCentral (@realcoincentral) May 6, 2026
MSTR stock climbed to $190 on Tuesday — its highest level since mid-November — before dipping 1% in after-hours trading.
Bitcoin dropped from around $87,000 on January 1 to roughly $68,000 by March 31. That’s a fall of more than 25% in just three months.
The company, led by Executive Chairman Michael Saylor, is the largest corporate holder of bitcoin in the world. It now owns 818,334 BTC, bought at an average price of $75,537 per coin.
At bitcoin’s current price near $81,000, that stash is worth approximately $66.82 billion. The company is sitting on an unrealized gain of close to $5 billion.
Strategy ended Q1 with $2.25 billion in cash, which covers about 18 months of preferred stock dividends.
STRC Gains Traction as Funding Tool
Executives pointed to the performance of its preferred stock STRC as a bright spot. CEO Phong Le called it a “big success,” citing strong demand, high liquidity, and low volatility.
STRC is structured to trade near a $100 par value, with an adjustable dividend currently set at an 11.5% annual yield. Strategy uses the capital raised to buy more bitcoin.
Year-to-date, STRC has helped raise $5.58 billion of the company’s total $11.68 billion raised in 2026. Executives are now calling STRC the primary “engine” behind its weekly bitcoin purchases.
Strategy has paid out more than $692 million in cumulative dividends across all its preferred stocks — STRC, STRK, STRF, and STRD.
Not everyone is convinced the model holds up. Critics have called it “circular,” with some going as far as labeling it a Ponzi scheme. Others see it as a practical way to channel yield-seeking capital into bitcoin exposure.
Grayscale analysts have noted that spot bitcoin ETFs remain the “cleanest” way to get bitcoin exposure without the complexity of preferred stock structures.
Bitcoin Rebound Could Flip Q2 to Profit
Five weeks into Q2, bitcoin has recovered above $80,000. Strategy has continued buying throughout the period.
If prices hold, the company could post a sizable profit in the April-June quarter — a stark reversal from Q1.
MSTR stock is up nearly 20% year-to-date, though it remains down more than 50% year-over-year.
With Q1 results largely expected by the market, investor attention is now on the 5 p.m. ET earnings call, where Saylor and his team are expected to outline next steps.
Bitcoin hit a three-month high of nearly $82,000 on Tuesday.
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