MicroStrategy Q1 net loss $12.5B after $14.5B Bitcoin writedown

MicroStrategy reported a $12.54 billion net loss for the first quarter of 2026, or $38.25 per diluted share, after recording a $14.46 billion unrealized writedown on its Bitcoin holdings. Bitcoin fell more than 23% between January and March, and the company’s revenue increased to $124.3 million.

The company recorded an operating loss of $14.47 billion for the quarter, up from $5.92 billion a year earlier. Net loss attributable to common stockholders widened to $12.77 billion, compared with $4.23 billion in Q1 2025. The unrealized digital asset markdown was $14.46 billion, versus $5.91 billion in the year-ago quarter.

Analysts had expected a smaller GAAP loss per share on average; the most bearish estimate before the report had been $36.89 per share.

Bitcoin posted its worst first quarter since 2018. Market pressures cited by the company during the quarter included a pullback in technology stocks, outflows from Bitcoin exchange-traded funds, a 15% global tariff introduced by the Trump administration, heightened U.S.–Iran tensions, and the Federal Reserve holding policy rates at 3.5%–3.75%.

Revenue rose 11.9% to $124.3 million from $111.1 million a year earlier. Gross profit increased to $83.4 million from $77.1 million, while gross margin narrowed to 67.1% from 69.4%. Cash and cash equivalents were $2.21 billion at March 31, down from $2.30 billion at the end of 2025.

MicroStrategy held 818,334 Bitcoin as of May 3, 2026. The company’s aggregate purchase cost for those coins was about $61.81 billion, or roughly $75,537 per coin. Using a Bitcoin price of $78,374 on May 1, the stake was valued at about $64.14 billion, leaving an approximate $2.3 billion paper gain on the aggregate cost basis.

The company continued to buy Bitcoin during the quarter, adding roughly 89,600 coins for about $5.5 billion, its second-largest quarterly purchase. The last reported acquisition in the reporting period was 3,273 Bitcoin on April 27 at an average price of $77,906 per coin.

MicroStrategy funded purchases through issuance of its Digital Credit instrument STRC and through sales under its at-the-market equity program. The company reported raising about $7.37 billion in gross proceeds via its ATM program during Q1 and an additional $4.32 billion from April 1 to May 3.

CEO Phong Le noted the growth in demand for STRC and said, “Digital Credit, highlighted by STRC, has been a big success. STRC has shown strong demand, high liquidity, and low volatility. We raised $5.6 billion year-to-date of STRC gross proceeds, increased daily trading volume to $375 million, while bringing volatility down to 3%, all done during a bitcoin bear market.”

CFO Andrew Kang described the company as the largest issuer of Digital Credit and cited the instruments’ contribution to returns: “MicroStrategy is the dominant issuer of Digital Credit in the world, with over $13.5 billion of preferred equity outstanding, supported by a fortress Bitcoin balance sheet. Strong demand for our Digital Credit instrument, STRC, has driven a BTC Yield of 9.4% and BTC $ Gain of approximately $5 billion through the first four months of the year.”

Founder and Executive Chairman Michael Saylor emphasized STRC’s size and risk-adjusted performance: “STRC has scaled to $8.5 billion in just 9 months and is now the largest preferred stock by market cap in the world. By extracting bitcoin’s performance and engineering price stability, we have produced a credit instrument with a 2.53 Sharpe ratio.”

The company reported a year-to-date BTC Yield of 9.4% and a BTC dollar gain of about $4.97 billion through the first four months of 2026, along with a net increase of 63,410 Bitcoin during that period.