Strategy Reports $8.33 Billion Q2 Operating Loss as Bitcoin Drops 27% Year-to-Date
Key Takeaways
- •Strategy recorded an $8.32 billion unrealized loss on its digital assets in Q2, reversing a $14.05 billion unrealized gain from the year-ago quarter under fair value accounting rules adopted in 2025.
- •As of July 26, the company held 843,775 Bitcoin with a market value of $54.77 billion, below the original acquisition cost of $63.69 billion at an average purchase price of approximately $75,476 per coin.
- •The core enterprise analytics software business generated $122.4 million in quarterly revenue, up 6.9% year-over-year, with a gross profit of $81.6 million at a 66.6% margin.
- •Strategy reduced its convertible debt by 18% to $6.71 billion after repurchasing $1.5 billion of notes at a discount and raised $17.06 billion through capital markets programs during the year.
- •The company maintained a $3.75 billion dollar reserve covering over two years of preferred stock dividends and interest obligations, while establishing separate $1 billion repurchase programs for common stock and digital credit securities.
Strategy reported an $8.33 billion operating loss for the second quarter, driven by a substantial unrealized loss on its digital asset holdings following Bitcoin's roughly 27% year-to-date decline. The company, formerly known as MicroStrategy, is the largest publicly traded corporate holder of Bitcoin, making its results a closely watched barometer for institutional exposure to the cryptocurrency.
Following the earnings release, Bitcoin was trading near $64,700, down from approximately $88,400 at the end of 2025. The company recorded an $8.32 billion unrealized loss on its digital assets during the quarter, a sharp swing from the $14.05 billion unrealized gain reported in the same period a year earlier. Under fair value accounting rules for digital assets adopted in 2025, these unrealized gains and losses flow directly through the income statement, amplifying reported earnings volatility relative to the company's core software operations.
Strategy posted a net loss of $8.22 billion, or $24.45 per diluted common share, compared with net income of $10.02 billion, or $32.60 per share, in the year-ago quarter. Shares were mostly flat in after-hours trading following the results.
As of July 26, Strategy held 843,775 Bitcoin, representing a 25% increase in holdings since the beginning of the year. The holdings carried an original cost of $63.69 billion and a market value of $54.77 billion, with an average purchase price of approximately $75,476 per Bitcoin, leaving the portfolio valued below its aggregate acquisition cost.
On the operational side, quarterly revenue rose 6.9% year-over-year to $122.4 million from $114.5 million. Gross profit reached $81.6 million, representing a 66.6% margin. These figures reflect the company's enterprise analytics software business, which operates alongside its Bitcoin treasury strategy.
Strategy raised $17.06 billion through its capital markets programs during the year and reported a Bitcoin yield of 4.5%. The company reduced its convertible debt by 18% to $6.71 billion after repurchasing $1.5 billion of notes at a discount.
Its dollar reserve stood at $3.75 billion, providing more than two years of coverage for preferred stock dividends and interest obligations. Strategy sold approximately $218.4 million of Bitcoin this year to help fund preferred dividends and established separate $1 billion repurchase programs for its common stock and digital credit securities.
Strategy Announces Second Quarter Financial Results — BusinessWire