NEW YORK, July 30, 2026, 17:04 EDT – Strategy shares declined after second-quarter results, while its $3.75 billion reserve gives the company more time to maintain its Bitcoin exposure.
- Strategy finished regular trading up 4.7% at $97.74, before edging down 0.6% in after-hours trading. Extended-hours figures are subject to change.
- The company reported a net loss of $8.22 billion, following an $8.32 billion digital-asset loss.
- The $3.75 billion reserve is sufficient to fund over 2.1 years of dividend and interest payments.
Strategy NASDAQ:MSTR shares slipped to $97.11 following the earnings release. Earlier in the session, they had gained 4.7%. The U.S. cash market was shut, while after-hours trading continued.
The headline loss mainly reflected an accounting adjustment. Investors concentrated on the expenses tied to backing Strategy’s expanding preferred-stock structure.
Preferred dividends totaled $400.7 million for the quarter, amounting to 4.9 times the $81.6 million gross profit recorded by the software segment. This highlights the importance of the sizable reserve, which provides time rather than boosting operating profit.
As of July 26, Strategy’s bitcoin holdings totaled 843,775 tokens. With bitcoin trading at around $64,732, the value of that position was roughly $54.6 billion. The latest estimate is 14.2% under Strategy’s average acquisition cost of $75,476.
The latest figures indicate a significant turnaround compared to the previous year’s increase driven by bitcoin.
| Q2 metric | 2026 | 2025 | Change |
|---|---|---|---|
| Revenue | $122.4 million | $114.5 million | up 6.9% |
| Gross profit | $81.6 million | $78.7 million | increased 3.7% |
| Gross margin | 66.6% | 68.8% | down 2.2 points |
| Operating result | -$8.33 billion | +$14.03 billion | reversed by $22.36 billion |
| Net result | -$8.22 billion | +$10.02 billion | declined by $18.24 billion |
| Preferred dividends | $400.7 million | $49.1 million | jumped 716% |
The operating loss reflected an unrealized bitcoin loss of $8.32 billion. Revenue increased, but there was no gross-margin expansion. Preferred dividends increased more than eight times.
Management acted during the quarter to ease immediate financial strain. Strategy bought back $1.50 billion in 2029 convertible notes, paying around $1.38 billion. This reduced its remaining convertible debt to $6.71 billion.
Liquidity picked up pace following the end of the quarter. The company’s recent filings and financials demonstrate this trend.
| Balance-sheet measure | Earlier level | Latest level | Change |
|---|---|---|---|
| Bitcoin holdings | 762,099 on March 29 | 846,000 on June 30 | +11.0% |
| Bitcoin holdings | 846,000 on June 30 | 843,775 on July 26 | -0.3% |
| Cash and short-term investments | $2.21 billion on March 31 | $2.45 billion on June 30 | +10.7% |
| USD reserve | About $2.4 billion on June 30 | $3.75 billion on July 26 | +$1.35 billion |
| Convertible notes | $8.21 billion before May repurchase | $6.71 billion following the repurchase | -18.3% |
The reserve coverage statement suggests yearly dividends and interest are roughly $1.8 billion or under, based on an early estimate from company figures. Preferred dividends for the second quarter, when annualized, total approximately $1.60 billion.
Annualized gross profit totaled approximately $326 million, while estimated fixed claims were around 5.5 times higher. Gross profit does not equate to cash flow, but the significant scale difference persists.
Strategy’s “current effective cost of credit” stands at 10.8%, Chief Financial Officer Andrew Kang said. Bitcoin needs to deliver an annual return higher than that rate for net bitcoin per share to achieve a positive spread, he added. Business Wire
Capital-market access continues to be crucial. Strategy secured $8.41 billion in the quarter, with an additional $1.28 billion raised by July 26. Total fundraising for the year so far stands at $17.06 billion.
| Gross ATM proceeds | Q2 2026 | July 1–26 |
|---|---|---|
| MSTR common stock | $2.947 billion | $1.276 billion |
| STRC preferred stock | $5.465 billion | — |
| Total | $8.412 billion | $1.276 billion |
The structure of funding leads to varying expenses. Issuing common stock may result in dilution for current shareholders. Introducing new preferred shares increases dividend obligations ranked above those of common equity.
Strategy has disposed of $218.4 million in bitcoin during the year, using the funds to cover some preferred dividend payments. The company’s board has authorized bitcoin sales up to $1.25 billion to support reserve funding and security buybacks.
Management is reallocating some funds into undervalued securities. Strategy acquired $25 million of Stretch preferred stock NASDAQ:STRC at a mean price of $86.53, reflecting a 13.5% reduction from the $100 face value. Chief Executive Phong Le stated that purchases will continue to be “regular and disciplined” as long as STRC trades under par. Business Wire
The company approved a $1 billion MSTR share buyback initiative. As of July 26, it had not repurchased any common stock. Michael Saylor characterized the environment as marked by “muted bitcoin sentiment and market skepticism.” Business Wire
Risks are still elevated. A further drop in bitcoin prices would lower asset coverage and increase reported losses. If demand for common or preferred shares is weak, more bitcoin may need to be sold. The strategy is also exposed to risks of dilution, refinancing, and dividend resets.
MSTR shareholders see the $3.75 billion reserve as delaying the funding test rather than eliminating it. Ongoing gains now hinge on bitcoin surpassing Strategy’s credit threshold without additional dilution per common share.
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