01—Abstract
Summary
Summary of the 8-K filed July 30, 2026. Cited figures are marked; the original filing is the authoritative source.
Strategy Inc (Nasdaq: MSTR) reported a second-quarter 2026 net loss of $8.22 billiona, or $24.45 per diluted common share, versus net income of $10.02 billion in the year-earlier quarter.
The loss was driven by an operating loss of $8.33 billionb, which includes an unrealized loss on digital assets of $8.32 billion as bitcoin prices declined. Total revenues were $122.4 million, up from $114.5 million a year earlier, and gross profit was $81.6 million. Net loss attributable to common stockholders was $8.62 billion after $400.7 million of preferred stock dividends.
The company's bitcoin holdings rose to 846,000 bitcoin at June 30, 2026 (843,775 as of July 26, 2026), with a carrying value of $49.67 billionc at quarter-end and an average cost of $75,578 per bitcoin. Management highlighted balance sheet actions, including the May 2026 repurchase of $1.50 billion of 0% convertible notes due 2029 for approximately $1.38 billion in cash, which reduced convertible principal from $8.21 billion to $6.71 billion. The USD Reserve was $3.75 billion as of July 26, 2026, which management said covers preferred dividends and interest for more than 2.1 years.
Management also outlined its Digital Credit strategy, including a STRC dividend rate increased to 12.00%, a $1.0 billiond STRC repurchase program under which 288,930 shares were bought at an average price of $86.53, and a $1.0 billion MSTR repurchase program with no repurchases to date. The company expects its preferred distributions to be treated as non-taxable return of capital for the foreseeable future. The filing's results are presented in the attached press release (Exhibit 99.1), and the information is furnished rather than filed.
02—Key points
Key Highlights
- Q2 2026 net loss of $8.22 billion ($24.45 per diluted share), compared with net income of $10.02 billion ($32.60 per diluted share) in Q2 2025
- Operating loss of $8.33 billion, including an unrealized loss on digital assets of $8.32 billion
- Total revenues of $122.4 million, up from $114.5 million a year earlier; gross profit of $81.6 million
- Bitcoin holdings of 846,000 at June 30, 2026, with a carrying value of $49.67 billion versus an average cost of $75,578 per bitcoin
- Convertible notes reduced from $8.21 billion to $6.71 billion after the May 2026 repurchase of $1.50 billion principal for about $1.38 billion in cash
- USD Reserve of $3.75 billion as of July 26, 2026, which management says covers more than 2.1 years of preferred dividends and interest
- Preferred dividends of $400.7 million in Q2 2026; STRC dividend rate raised to 12.00%, with a $1.0 billion STRC repurchase program and no MSTR repurchases to date
03—Questions
Frequently Asked Questions
Why did Strategy report a large net loss in Q2 2026?
The net loss was driven by an unrealized loss on digital assets of $8.32 billion in the quarter, as the company's bitcoin is measured at fair value under ASU 2023-08 and the market price of bitcoin declined. The company reported total revenues of $122.4 million in the same period.
How much bitcoin does Strategy hold and what did it cost?
As of June 30, 2026, the company held approximately 846,000 bitcoin with a carrying value of $49.67 billion and an average purchase price of $75,578 per bitcoin. As of July 26, 2026, it held approximately 843,775 bitcoin, with a market price of about $64,915 per bitcoin as of July 27, 2026.
What did the company do to reduce its debt?
In May 2026, Strategy repurchased $1.50 billion of its 0% Convertible Senior Notes due 2029 for approximately $1.38 billion in cash, an approximate 8% discount to par. This reduced aggregate convertible note principal from $8.21 billion to $6.71 billion.
Can Strategy cover its preferred dividends and interest payments?
Management stated that the USD Reserve of $3.75 billion as of July 26, 2026 covers existing preferred dividend payments and interest obligations for more than 2.1 years. The company also noted 18 consecutive months of dividend payments and sold $218.4 million of bitcoin in 2026 year to date to fund a portion of preferred dividends.
What do the STRC and MSTR repurchase programs mean for investors?
The company has a $1.0 billion STRC repurchase program and repurchased 288,930 STRC shares for about $25.00 million at an average price of $86.53, a 13.47% discount to the $100 stated amount. The $1.0 billion MSTR repurchase program has had no repurchases to date, and management says it will consider MSTR buybacks when the stock trades below intrinsic value.
04—Continue