Strategy reports record $20.91 billion operating income in Q3 2026

Strategy announced on Thursday that third-quarter 2026 operating income reached a company record of $20.91 billion. Unrealized gains on Strategy's bitcoin holdings generated most of the operating income as bitcoin recovered during the quarter. Net income increased to $19.53 billion, equivalent to $44.75 per diluted share, from $2.79 billion a year earlier. Chief Financial Officer Andrew Kang announced Kang's departure in the same release.

Strategy revalues bitcoin holdings at market prices every quarter, incorporating bitcoin price changes into earnings. Strategy held 848,517 bitcoin worth $68.9 billion on October 23, when bitcoin traded at $81,200. The holdings had an average acquisition cost of $75,446 per bitcoin, leaving Strategy with an unrealized gain. Kang said Strategy had expanded the company's bitcoin holdings by 26% year-to-date despite difficult bitcoin market conditions.

Revenue decreased 3% from a year earlier to $125.4 million, falling short of the $127.2 million analysts expected. Gross profit totaled $89.6 million, representing a 71% margin versus 70% a year earlier. Strategy finished September with cash and equivalents of $2.50 billion. Short-term investments totaled $3.40 billion at September's end.

However, bitcoin per share, management's principal performance measure, declined. Year-to-date BTC yield was negative 3.7%, indicating less bitcoin backing each share than in January. The bitcoin position recorded a dollar-measured loss of $2.03 billion over the same period. Strategy sold approximately $431.8 million of bitcoin this year to pay preferred dividends and finance share repurchases.

Strategy raised $21.23 billion in capital during 2026. The at-the-market program generated net proceeds of $5.41 billion in the third quarter alone. Strategy subsequently directed a substantial portion of the capital raised toward repurchasing the company's preferred shares. Strategy repurchased 20,980,508 STRC shares for $2.04 billion, paying an average of $97.39 per share against a stated amount of $100. Chief Executive Phong Le said the repurchases were intended to restore STRC's financial health. Management said Strategy intends to continue repurchases while STRC trades below par. The repurchase authorization has approximately $956.7 million remaining.

Strategy's dollar reserves now amount to $5.07 billion, comprising a $4.83 billion USD Reserve and $242.4 million of USD Cash. Strategy said the reserves cover 3.4 years of dividend and interest payments. The board maintained STRC's dividend rate at 12.00% to encourage trading close to the $100 stated amount.

Shareholders authorized daily dividend payments on October 28 to improve liquidity and limit price volatility. STRC will start daily payments on November 1. STRF, STRK and STRD will adopt daily payments on January 1, 2027. Le described daily dividends as preparation for a tokenized financial system operating continuously and said Strategy intends to lead that development. Strategy expects preferred distributions to qualify as a non-taxable return of capital for at least ten years because Strategy does not anticipate positive accumulated earnings and profits.

STRC traded as high as $99.99 earlier today, approaching the $100 par value. A return to par would reopen funding for bitcoin purchases. However, Strategy has not confirmed a resumption of STRC share issuance.