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Strategy Inc. (Nasdaq: MSTR) reported first-quarter 2026 financial results on May 5, highlighting the trade-off behind its bitcoin treasury strategy: expanding bitcoin exposure while absorbing large digital-asset valuation swings. The company increased its BTC position and raised $11.68 billion year to date, but posted a $12.54 billion net loss after digital asset valuation losses affected quarterly earnings.
Strategy reported a $12.54 billion net loss in Q1 2026, driven by $14.46 billion of unrealized bitcoin losses. Revenue increased 11.9% year over year to $124.3 million, but earnings were dominated by digital asset volatility. The company also reported an operating loss of $14.47 billion, tied to the unrealized digital asset decline.
Strategy said its bitcoin expansion continues to be funded through capital markets. It raised $7.37 billion through at-the-market offerings in the first quarter and an additional $4.32 billion from April 1 through May 3. The company indicated that proceeds from sales of class A common stock, STRC stock, and STRK stock supported additional bitcoin purchases.
STRC, Strategy’s perpetual preferred stock, was central to the financing model. The article notes that STRC traded at $99.96 with an 11.50% yield and $8.54 billion in notional value. It averaged $381.1 million in daily trading, with 3.1% volatility and a 4.2x BTC rating. Year to date, STRC raised $5.58 billion, and cumulative dividends declared and paid across preferred stock reached $692.5 million.
CEO Phong Le said:
“Adoption of bitcoin continues to grow in 2026. Digital Credit, highlighted by STRC, has been a big success.”
As of May 3, Strategy reported an original cost basis of $61.81 billion and a market value of $64.14 billion. The company reported a 9.4% BTC yield, a 63,410 BTC gain, and $4.97 billion in BTC gains year to date. Strategy also cautioned that these KPIs are not traditional performance, valuation, liquidity, or yield measures.
The article states that the structure has scaled quickly, reaching $8.5 billion within nine months. It also notes that about $150 million of STRC is held in corporate treasuries and more than $270 million is held across DeFi protocols.
Executive Chairman Michael Saylor said:
“By extracting bitcoin’s performance and engineering price stability, we have produced a credit instrument with a 2.53 Sharpe ratio.”
Strategy proposed moving STRC dividend payments to a semi-monthly schedule. The article frames the overall model as expanding bitcoin exposure alongside rising earnings volatility.
The company also paused bitcoin purchases, shifting focus to its existing 818,334 BTC exposure. The article notes that the pause followed 108 total purchases, but the provided text cuts off before additional details are included.
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