Strategy reported a net loss of $12.54 billion for the first quarter of 2026 on Tuesday — its third consecutive earnings miss — driven almost entirely by unrealised losses on its Bitcoin holdings. But the number that sent MSTR down more than 4% in after-hours trading was not on the income statement. It was something Michael Saylor said on the earnings call.
Saylor suggested during the Q1 call that the company may sell a portion of its Bitcoin holdings to fund dividend payments, saying: "We will probably sell some bitcoin to pay a dividend just to inoculate the market and send the message that we did it." He elaborated on the logic: "You buy bitcoin with credit, you let it appreciate, and then you sell bitcoin to pay the dividend."
It was the first time Saylor had indicated a willingness to reduce Strategy's Bitcoin position, a reversal of the company's defining posture since it began accumulating BTC in 2020. The world's largest corporate Bitcoin holder has not sold any of its position before. The model has always been to buy and hold.
The context for the shift is Strategy's growing dividend obligations. The company carries roughly $1.5 billion in annual dividend and debt-related obligations, and has approximately 18 months of USD reserves to cover them at current run-rates. On the call, Saylor walked through the math: if Strategy were to sell $1.5 billion of STRC per year, it could sell Bitcoin to pay dividends, buy more Bitcoin than it sold, grow its Bitcoin stack, and still generate Bitcoin yield. He also told investors that the company's ability to sell Bitcoin to buy U.S. dollars, or to sell Bitcoin to buy debt if it is accretive to Bitcoin per share, is something it would consider going forward, and that it would sell Bitcoin when it is advantageous to the company.
On the financials, the headline loss was accounting-driven. The operating loss for Q1 2026 was $14.47 billion, including an unrealised loss on digital assets of $14.46 billion, compared to an unrealised loss of $5.91 billion in Q1 2025. The underlying software business continued to grow modestly: total revenues for Q1 2026 were $124.3 million, up 11.9% year-over-year, with a gross margin of 67.1%.
On the Bitcoin side, the picture is more constructive. Strategy holds 818,334 BTC as of May 3, representing 22% growth year to date, at an average cost of $75,537 per coin. The company achieved a BTC Yield of 9.4% year to date and a BTC Dollar Gain of approximately $4.97 billion. It raised $11.68 billion year to date through its at-the-market offering program.
The preferred equity business has also scaled rapidly. STRC raised $5.58 billion year to date — 189% growth — and has reached $8.5 billion in market cap in just nine months, making it the largest preferred stock by market cap in the world, according to Saylor. The company has met 23 consecutive dividend distributions totalling over $693 million since launching preferred equity products in early 2025.
The market's reaction to the after-hours call was swift. MSTR fell more than 4%. The drop reflects a straightforward concern: Strategy's equity premium over its Bitcoin NAV has always rested on the assumption that it accumulates BTC indefinitely. Any signal of a change to that model, even a tactical and signposted one, resets the terms of the trade.
