- Strategy posted $12.54B net loss after a 30% Bitcoin drop, with $14.46B in unrealized losses driving earnings miss.
- Firm expanded holdings to 818,334 BTC, continuing aggressive accumulation despite market downturn pressure.
- Company may sell Bitcoin to fund dividends, signaling shift from strict hold strategy amid market volatility.
Strategy Inc. reported a sharp earnings miss, driven by large Bitcoin losses in the first quarter of 2026. The firm posted a $38.25 loss per share, far exceeding estimates. The decline followed a steep Bitcoin price drop during the quarter, which triggered heavy unrealized losses.
Earnings Miss Driven By Bitcoin Decline
Strategy reported a net loss of $12.54 billion for the quarter ended March 2026. This widened from a $4.22 billion loss a year earlier. The company recorded a $14.46 billion markdown on its Bitcoin holdings, which drove the earnings miss.
However, revenue reached $124.3 million, slightly below expectations of $124.6 million. Notably, this marked an increase from $111.1 million in the same period last year. The growth reflected stable performance in its core operations despite market pressure.
Meanwhile, Bitcoin fell nearly 30% during the quarter amid the U.S.-Iran war. However, prices later recovered above $81,000. This rebound pushed Strategy’s year-to-date Bitcoin gains to $5.1 billion.
Bitcoin Holdings Expand Amid Pressure
Despite losses, Strategy continued accumulating Bitcoin throughout the quarter. As of early May 2026, the company held 818,334 BTC, up 22% year-over-year. It also reported a 9.4% Bitcoin yield and a gain of 63,410 BTC year-to-date.
The company purchased 89,599 BTC during the quarter, maintaining its acquisition strategy. CEO Phong Le said adoption of Bitcoin continued to grow in 2026. He added that the STRC program helped raise billions with relatively low volatility.
CFO Andrew Kang highlighted dividend consistency, noting 23 consecutive payouts completed on time. Meanwhile, Executive Chairman Michael Saylor said STRC scaled to $8.5 billion within nine months.
Shift In Strategy and Market Reaction
During the earnings call, Michael Saylor said the company may sell some Bitcoin to fund dividends. He explained the move aims to demonstrate Bitcoin’s use as a treasury asset.
Phong Le also confirmed the company could sell Bitcoin when it benefits operations. He said the firm would not commit to a strict “never sell” stance going forward.
Markets reacted quickly to the update. Strategy shares fell over 4% after hours, while Bitcoin briefly dipped below $81,000. Notably, the company previously sold 704 BTC in December 2022 during market stress.
