Strategy Inc
For the period ended Jun 30, 2026. Filed Aug 3, 2026.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Jun 30, 2026 · Filed Aug 3, 2026
MSTR$128.93-0.3%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2026-03-31; filed 2026-05-06.
0001050446-26-000031
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2026-06-30; filed 2026-08-03.
0001050446-26-000044
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 237 previous paragraphs and 283 current paragraphs.
120 unchanged; 93 reworded; 62 added; 24 removed; 0 previous and 8 current paragraphs rearranged.
Tables are not compared: 17 previous and 19 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (62)
Current report
Segment Reporting
Current report
Beginning with the second quarter of 2026, we have realigned our financial reporting to present our operations as two reportable segments: our Software segment and our Bitcoin segment. In prior periods, we reported a single reportable operating segment, our Software segment (previously referred to as the “Software Business”), and presented the bitcoin-related activities now comprising our Bitcoin segment within a non-operating “Corporate & Other” category. We made this change to provide users of our financial statements with greater visibility into the activities of our software business distinct from our bitcoin treasury operations. See Note 13, Segment Information, to the Consolidated Financial Statements included in Part I, Item 1 of this Quarterly Report for additional information regarding our reportable segments. The discussion that follows presents a consolidated overview of our results of operations, liquidity, and capital resources, followed by a separate discussion of the results of each of our reportable segments.
Current report
As part of our capital management strategy, we maintain a U.S. dollar reserve (the "USD Reserve") intended to support the payment of dividends on our Preferred Stock and interest expense on our outstanding indebtedness. In June 2026, our board of directors approved a formal policy governing the USD Reserve and adopted a broader capital management framework, which we refer to as our “Digital Credit Capital Framework,” consisting of a board-approved USD Reserve policy, a revised STRC dividend rate policy, a repurchase program for our Preferred Stock, a repurchase program for our class A common stock, and a BTC monetization program, as discussed in further detail under “Liquidity and Capital Resources—Digital Credit Capital Framework” below. Our capital management strategy also contemplates that we may (i) enter into additional capital raising transactions that are secured, directly or indirectly, by our assets, including bitcoin, (ii)
Current report
(b)In the second quarter of 2025, we purchased bitcoin using $5.19 billion of the net proceeds from ATM sales of class A common stock, $979.7 million of the net proceeds from our initial public offering of STRD Stock, $163.0 million of the net proceeds from ATM sales of STRF Stock, and $438.0 million of the net proceeds from ATM sales of STRK Stock.
Current report
(d)In the second quarter of 2026, we purchased bitcoin using $5.46 billion of the net proceeds from ATM sales of STRC Stock, and $0.96 billion of the net proceeds from ATM sales of class A common stock.
Current report
(e)The proceeds from the sales were used to fund dividend payments on Preferred Stock.
Current report
(f)$75,578 presented in the Approximate Average Purchase or Sale Price Per Bitcoin column represents the average price we paid for the bitcoin we held as of June 30, 2026.
Current report
Our unrealized loss on digital assets for the three and six months ended June 30, 2026 amounted to $8.32 billion and $22.77 billion, respectively.
Current report
(1) On March 23, 2026, we announced a new $21.0 billion offering of MSTR Stock (the “MSTR Increase”). The MSTR Stock amount available for issuance reflects the aggregate remaining capacity of both the current offering as of June 30, 2026 and the MSTR Increase. Sales under the MSTR Increase may begin once capacity under the existing offering is substantially depleted.
Current report
Debt Offerings and Repurchases
Current report
During the three months ended June 30, 2026, we repurchased $1.50 billion aggregate principal amount of our 0% Convertible Senior Notes due 2029 in privately negotiated transactions, for an aggregate cash repurchase price of $1.38 billion. The repurchased notes were canceled.
Current report
The Company seeks to acquire bitcoin in a manner it believes to be accretive to common stockholders. To assess achievement of this strategy, the Company monitors and reviews the following Key Performance Indicators (“KPIs”):
Current report
•BTC Yield represents the percentage change in BPS (in Sats) from the beginning of a period to the end of a period.
Current report
◦Three months ended June 30:
Current report
▪Bitcoin Activity: During the three months ended June 30, 2026, we acquired 85,296 bitcoin and sold approximately 1,395 bitcoin, increasing our holdings on a net basis to approximately 846,000 bitcoin, as compared to 69,140 bitcoin acquired and none sold during the three months ended June 30, 2025. These purchases during the three months ended June 30, 2026 were funded primarily with net proceeds from issuances of STRC Stock and class A common stock. The purchases during the three months ended June 30, 2025 were funded primarily with net proceeds from issuances of class A common stock, STRK Stock and STRF Stock.
Current report
▪Assumed Diluted Shares Outstanding: During the three months ended June 30, 2026, we issued approximately 24.7 million shares of class A common stock under our ATM for aggregate net proceeds of approximately $2.94 billion, and our repurchase of $1.50 billion aggregate principal amount of our 2029 Convertible Notes led to a decrease in the number of Assumed Diluted Shares Outstanding by approximately 2.2 million, which, collectively, increased our Assumed Diluted Shares Outstanding by approximately 22.4 million shares, to approximately 401.3 million as of June 30, 2026. Issuances of STRC Stock during this period did not increase our Assumed Diluted Shares Outstanding because shares of STRC Stock are not convertible into shares of class A common Stock. Of those net proceeds from the sale of our class A common stock, approximately $1.65 billion was used to fund the USD Reserve, approximately $317.0 million was used to pay dividends on our Preferred Stock, and approximately $9.0 million was used to pay interest on our Convertible Notes, with the remaining net proceeds used primarily to acquire bitcoin. Because a portion of the proceeds from sales of class A common stock under our ATM was used to pay dividends and interest rather than acquire bitcoin, those sales increased Assumed Diluted Shares Outstanding (the denominator of BPS (in Sats)) without a corresponding increase in our bitcoin holdings. As a result, the issuances reduced, or offset increases in, BTC Yield for the period. By comparison, during the three months ended June 30, 2025, we issued approximately 14.2 million shares of class A common stock and 4.6 million shares of STRK Stock (which is convertible to common stock on a 1 for 10 basis) under our ATM for aggregate net proceeds of approximately $5.7 billion, increasing our Assumed Diluted Shares Outstanding by approximately 14.6 million shares, to approximately 314.2 million as of June 30, 2025. Of the net proceeds from those class A common stock issuances and STRK issuances, approximately $49.1 million was used to pay dividends on our Preferred Stock and $9.0 million was used to pay interest on our Convertible Notes, with the remaining net proceeds used primarily to acquire bitcoin.
Current report
◦Six months ended June 30:
Current report
▪Bitcoin Activity: During the six months ended June 30, 2026, we acquired 174,895 bitcoin and sold approximately 1,395 bitcoin, increasing our holdings on a net basis to approximately 846,000 bitcoin, as compared to 149,855 bitcoin acquired and none sold during the six months ended June 30, 2025. These purchases during the six months ended June 30, 2026 were funded primarily with net proceeds from issuances of STRC Stock and class A common stock and STRK Stock. The purchases during the six months ended June 30, 2025 were funded primarily with net proceeds from issuances of class A common stock, STRK Stock and STRF Stock.
Current report
▪Assumed Diluted Shares Outstanding: During the six months ended June 30, 2026, we issued approximately 58.5 million shares of class A common stock under our ATM for aggregate net proceeds of approximately $8.24 billion, and our repurchase of $1.50 billion aggregate principal amount of our 2029 Convertible Notes led to a decrease in the number of Assumed Diluted Shares Outstanding by approximately 2.2 million, which, collectively, increased our Assumed Diluted Shares Outstanding by approximately 56.4 million shares, to approximately 401.3 million as of June 30, 2026. Issuances of STRC Stock during this period did not increase our Assumed Diluted Shares Outstanding because shares of STRC Stock are not convertible into shares of class A common Stock. Of those net proceeds from the sale of our class A common stock, approximately $1.52 billion was used to fund the USD Reserve, approximately $546.0 million was used to pay dividends on our Preferred Stock, and approximately $17.3 million was used to pay interest on our Convertible Notes, with the remaining net proceeds used primarily to acquire bitcoin. Because a portion of the proceeds from sales of class A common stock under our ATM was used to pay dividends and interest rather than acquire bitcoin, those sales increased Assumed Diluted Shares Outstanding (the denominator of BPS (in Sats)) without a corresponding increase in our bitcoin holdings. As a result, the issuances reduced, or offset increases in, BTC Yield for the period. By comparison, during the six months ended June 30, 2025, we issued approximately 26.9 million shares of class A common stock and 12.2 million shares of STRK Stock (which is convertible to common stock on a 1 for 10 basis) under our ATM for aggregate net proceeds of approximately $10.69 billion, and issued the 2030B
Current report
Convertible Notes for aggregate net proceeds of approximately $1.98 billion, collectively increasing our Assumed Diluted Shares Outstanding by approximately 32.5 million shares, to approximately 314.2 million as of June 30, 2025. Of the net proceeds from those class A common stock issuances and STRK issuances, approximately $58.1 million was used to pay dividends on our Preferred Stock and $17.2 million was used to pay interest on our Convertible Notes, with the remaining net proceeds used primarily to acquire bitcoin.
Current report
▪Legal and regulatory uncertainty: Due to the continuing evolution of the legal and regulatory framework governing bitcoin and those who own, hold, or transact in bitcoin, we face the risk that legislative and regulatory bodies in the U.S. and other jurisdictions may adopt new legislation, regulations, or guidance affecting bitcoin, digital assets, and market participants. Any such developments could have a material impact on bitcoin (including its price, liquidity, and utility), the digital asset markets generally, and us.
Current report
•Software:
Current report
We began presenting Software and Bitcoin as two reportable operating segments in the second quarter of 2026 and the discussion below addresses both our consolidated results and, where useful to explain material drivers, segment-level results. See Note 13, Segment Information, to the Consolidated Financial Statements included in Part I, Item 1 of this Quarterly Report.
Current report
Consolidated Overview
Current report
The following table sets forth our revenue and net income (loss) by reportable segment for the periods indicated:
Current report
Total revenues were $122.4 million and $246.7 million for the three and six months ended June 30, 2026, respectively, compared to $114.5 million and $225.6 million for the same periods in the prior year. All of our revenues in each period presented were generated by our Software segment. For a discussion of the drivers of the changes in our revenues, see "Software Segment" below.
Current report
We recognized a net loss of $8.22 billion and $20.76 billion for the three and six months ended June 30, 2026, respectively, compared to net income of $10.02 billion and $5.80 billion for the same periods in the prior year. The unfavorable change was primarily attributable to unrealized losses on digital assets resulting from the volatility and decline in the market price of bitcoin during the 2026 periods, compared to unrealized gains on digital assets recognized during the comparable periods in the prior year.
Current report
Bitcoin Segment
Current report
The following table sets forth the results of operations of our Bitcoin segment for the periods indicated:
Current report
Our Bitcoin segment had net loss of $8.22 billion and $20.28 billion for the three and six months ended June 30, 2026, respectively. Segment net loss increased by $18.21 billion and $26.03 billion for the three and six months ended June 30, 2026, respectively, as compared to the same periods in the prior year, primarily due to unrealized losses on digital assets resulting from the volatility and decrease in the market price of bitcoin during the period, as compared to unrealized gains on digital assets recognized in the prior year.
Current report
Software Segment
Current report
The following table sets forth the results of operations of our Software segment for the periods indicated:
Current report
Our Software segment had net income of $3.7 million and net loss of $485.7 million for the three and six months ended June 30, 2026 respectively, representing a decrease of $26.7 million and $534.3 million as compared to the same periods in the prior year. The following discussion presents the components of our Software segment results of operations.
Current report
Total Software segment revenues were $122.4 million and $246.7 million for the three and six months ended June 30, 2026, respectively, an increase of $7.9 million and $21.1 million as compared to the same periods in the prior year. The increases were primarily driven by growth in subscription services revenues, partially offset by declines in product support revenues, in each case reflecting the continued migration of our on-premises customers to our Cloud subscription services offerings. Changes in product licenses revenues and other services revenues were not significant in either period. See the following discussion of the drivers of the changes in subscription services and product support revenues.
Current report
Expenses
Current report
Total significant expenses were $115.8 million and $235.7 million for the three and six months ended June 30, 2026, respectively, an increase of $1.3 million and $10.5 million as compared to the same periods in the prior year. Controllable expenses increased by $5.7 million and $15.9 million, primarily driven by higher sales and marketing, and cloud and maintenance expenses, while non-controllable expenses decreased by $4.5 million and $5.4 million. See the following discussion of the drivers of the changes in sales and marketing and cloud and maintenance expenses.
Current report
•Cloud and Maintenance expenses. Cloud and Maintenance expenses consist primarily of personnel and related overhead costs associated with providing product support and cloud subscription services, as well as cloud hosting infrastructure costs. Cloud and Maintenance expenses increased by $5.5 million and $12.9 million for the three and six months ended June 30, 2026, respectively, primarily driven by increased cloud infrastructure costs.
Current report
Consolidated Items
Current report
The following items are discussed on a consolidated basis.
Current report
We manage our liquidity and capital resources on a consolidated basis across both of our reportable segments. Our Software segment generates the recurring operating cash flows that fund our day-to-day operations, while our capital markets activities, our bitcoin holdings, and our USD Reserve are the principal sources of capital supporting our Bitcoin segment and preferred stock dividend payments and our indebtedness obligations. Accordingly, the following discussion of liquidity and capital resources is presented on a consolidated basis.
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Removed paragraphs (24)
Previous report
Our unrealized loss on digital assets for the three months ended March 31, 2026 and 2025 amounted to $14.46 billion and $5.91 billion, respectively, partially offset by $2.42 billion and $1.69 billion in deferred tax benefit respectively. See “Results of Operations – Bitcoin Impacts” additional information.
Previous report
(1) Excludes proceeds from shares sold during the period but not yet settled as of March 31, 2026.
Previous report
(2) On March 23, 2026, we announced the following updates to our ATM: (i) a new $21.0 billion offering of STRC Stock (the “STRC Increase”), (ii) a new $21.0 billion offering of MSTR Stock (the “MSTR Increase”), (iii) the termination of our prior offering of STRK Stock and (iv) a new $2.1 billion offering of STRK Stock. The STRC Stock and MSTR Stock amounts reflect the aggregate remaining capacity of such securities as of March 31, 2026 under the then-existing offering and the respective increases. Sales under the STRC Increase and MSTR Increase begin once capacity under the then-existing offerings is substantially depleted.
Previous report
Debt Offerings
Previous report
We seek to increase BPS (defined below) by growing our bitcoin holdings faster than Assumed Diluted Shares Outstanding (defined below) through a combination of bitcoin acquisitions and disciplined use of equity and credit markets. To assess achievement of this strategy, we monitor and review the following Key Performance Indicators ("KPIs"):
Previous report
•BTC Yield is a KPI that represents the percentage change in BPS from the beginning of a period to the end of the period.
Previous report
◦We acquired 89,599 bitcoin (increasing our total holdings to 762,099) during the three months ended March 31, 2026, compared to 80,715 bitcoin acquired (increasing our total holdings to 528,185) during the three months ended March 31, 2025. Of the approximately $7.36 billion in net proceeds we raised from capital markets activity during the three months ended March 31, 2026, approximately $5.30 billion was attributable to issuances of class A common stock and STRK Stock under our ATM, which resulted in an increase of approximately 33.8 million shares in Assumed Diluted Shares Outstanding (bringing our total Assumed Diluted Shares Outstanding to approximately 378.8 million as of March 31, 2026), while approximately $2.06 billion was attributable to issuances of the STRC Stock under our ATM, which did not increase our Assumed Diluted Shares Outstanding. In comparison, the $7.69 billion in net proceeds we raised from capital markets activity during the three months ended March 31, 2025, was primarily attributable to approximately $4.40 billion from issuances of class A common stock under our then-existing class A common stock ATM, $563.2 million from the initial public offering of the STRK Stock, $30.4 million from the issuances of STRK Stock under our then-existing STRK Stock ATM, and $1.98 billion of net proceeds from the issuance of our 2030B Convertible Notes, which resulted in an increase of approximately 18.0 million shares in Assumed Diluted Shares Outstanding (bringing our total Assumed Diluted Shares Outstanding to approximately 299.7 million as of March 31, 2025), while approximately $710.9 million was attributable to the initial public offering of STRF Stock and which did not increase our Assumed Diluted Shares Outstanding. Further, we used proceeds from the issuance of class A common stock under our ATM to pay $220.3 million and $17.4 million of dividends on our Preferred Stock and interest on our Convertible Notes, collectively, during the three months ended March 31, 2026 and 2025, respectively. Such issuances increased Assumed Diluted Shares Outstanding without a corresponding increase to our bitcoin holdings, thereby offsetting BTC Yield in such period. See “Liquidity and Capital Resources” for additional information. While issuances of STRF Stock, STRC Stock, STRE Stock and STRD Stock do not increase our Assumed Diluted Shares Outstanding, these securities, as well as STRK Stock and our Outstanding Convertible Notes, rank senior to our class
Previous report
•Software business:
Previous report
The following table sets forth certain operating highlights for the three months ended March 31, 2026 and 2025:
Previous report
Unrealized losses associated with digital assets
Previous report
We did not sell any of our digital assets during the three months ended March 31, 2026 and 2025.
Previous report
Software Business Impacts
Previous report
•Product licenses revenues. Product license revenues are derived from fees earned for licensing our business intelligence software to customers on a term or perpetual basis for installation on-premises. Product license revenue is recognized at the point when control to the license is transferred to the customer. Product license revenues decreased by $1.8 million for the three months ended March 31, 2026, as compared to the same period in the prior year, primarily due to increased migration to our cloud subscription services offerings.
Previous report
•Other services revenues. Other services revenues are derived from providing consulting services and training and education services. Revenue from consulting services and certain education services is recognized over time as the services are delivered, and revenue from annual education subscriptions is recognized on a straight-line basis over the contract period. Other services revenues increased by $1.6 million for the three months ended March 31, 2026, as compared to the same period in the prior year, primarily due to higher demand for consulting services.
Previous report
Costs of Revenue
Previous report
•Cost of Revenues. Cost of revenues increased by $7.0 million for the three months ended March 31, 2026, as compared to the same period in the prior year, driven primarily by an increase in subscription services cost of revenues due to higher cloud‑hosting costs from increased customer and internal usage.
Previous report
Operating Expenses
Previous report
•Research and development expenses. Research and development expenses consist of the personnel costs for our software engineering personnel and related overhead costs. Research and development expenses increased by $0.2 million for the three months ended March 31, 2026, as compared to the same period in the prior year, reflecting higher cloud-hosting costs for internal development and testing, partially offset by lower personnel costs attributable to a shift in the geographic mix of our workforce.
Previous report
•General and administrative expenses. General and administrative expenses consist of personnel and related overhead costs, and other costs of our executive, finance, human resources, information systems, and administrative departments, as well as third-party consulting, legal, and other professional fees, and third-party costs associated with our digital asset holdings. General and administrative expenses decreased by $3.2 million for the three months ended March 31, 2026, as compared to the same period in the prior year, primarily due to decreases in bitcoin advocacy costs for the current quarter, costs related to our special meeting of shareholders held in first quarter 2025 and share-based compensation expense, offset by increased professional fees.
Previous report
Debt Offerings
Previous report
On March 31, 2026, we announced that our board of directors maintained the monthly regular dividend rate per annum on STRC Stock at 11.50% for monthly periods commencing on or after April 1, 2026. Also on March 31, 2026, our board of directors declared a monthly cash dividend of $0.958333333 per share payable on STRC Stock on April 30, 2026 (or, if such day is not a business day, the next business day) to stockholders of record as of 5:00 p.m., New York City time, on April 15, 2026.
Previous report
Net cash provided by financing activities decreased by $0.55 billion for the three months ended March 31, 2026, compared to the same period in the prior year, primarily due to (i) a $1.99 billion decrease in long-term debt proceeds, net of issuance costs, as we did not complete any new debt offerings during the three months ended March 31, 2026, and (ii) a $220.3 million increase in dividends paid on our Preferred Stock compared to the prior year period, partially offset by (iii) a $0.89 billion increase in net proceeds from ATM sales of class A common stock as compared to the prior year period, (iv) a $0.76 billion increase in net proceeds from ATM sales of STRC Stock and STRK Stock as compared to the prior year period.
Previous report
BTC Yield is a KPI that represents the percentage change in BPS from the beginning of a period to the end of a period.
Previous report
•BPS does not represent (i) our ability to satisfy our financial obligations, or (ii) our book value per share. Ownership of a share of our common stock does not represent an ownership interest in the bitcoin held by us.
Reworded paragraphs (93)
Previous wording
In addition to and in conjunction with our Treasury Reserve Policy, we pursue a corporate strategy of acquiring and holding bitcoin, including with the proceeds of capital raising transactions. Our capital markets strategy generally involves issuing class A common stock and preferred securities, which we collectively refer to as “digital credit,” through at-the-market equity offering programs (“ATMs”) when we deem advantageous.
Current wording
In addition to and in conjunction with our Treasury Reserve Policy, we pursue a corporate strategy of acquiring and holding bitcoin, including with the proceeds of capital raising transactions. Our capital markets strategy generally involves issuing preferred securities, which we collectively refer to as “digital credit,” and class A common stock through at-the-market equity offering programs (“ATMs”) when we deem advantageous.
Previous wording
As part of our capital management strategy, we maintain a U.S. dollar reserve (the "USD Reserve"), which is a management-designated portion of our liquidity intended to support the payment of dividends on our Preferred Stock and interest on our outstanding indebtedness. Our capital management strategy also contemplates that we may (i) enter into additional capital raising transactions that are secured, directly or indirectly, by our assets, including bitcoin, (ii) pursue strategies intended to generate income streams or otherwise generate funds using our bitcoin holdings; and (iii) periodically sell bitcoin for general corporate purposes, such as satisfying liquidity needs and financial obligations.
Current wording
pursue strategies intended to generate income streams or otherwise generate funds using our bitcoin holdings, and (iii) periodically sell bitcoin for general corporate purposes, such as satisfying liquidity needs and financial obligations.
Previous wording
We view our bitcoin holdings as long-term holdings and expect to continue to accumulate bitcoin. We have not established a specific target amount of bitcoin to hold and actively evaluate market conditions, financing opportunities, liquidity needs, and capital structure considerations on an ongoing basis.
Current wording
We view our bitcoin holdings as long-term holdings and plan to continue to accumulate bitcoin over the long term. We have not established a specific target amount of bitcoin to hold and actively evaluate market conditions, financing opportunities, liquidity needs, and capital structure considerations on an ongoing basis.
Previous wording
Strategy One™, our cloud-native analytics platform, is used by enterprises across a wide range of industries to deliver business intelligence and analytics solutions. It delivers visualization, reporting, and embedded analytics capabilities across retail, banking, technology, manufacturing, insurance, consulting, healthcare, telecommunications, and the public sector. Complementing this, Strategy Mosaic™ is a universal data layer that enables organizations to achieve a single source of truth across their data. It provides enterprises with consistent definitions and governance across data sources, regardless of where that data resides or which tools access it. AI-powered data modeling hastens data product creation, while Mosaic’s intelligent architecture promotes accelerated performance for all workloads.
Current wording
Our cloud-native analytics platform, is used by enterprises across a wide range of industries to deliver business intelligence and analytics solutions. It delivers visualization, reporting, and embedded analytics capabilities across retail, banking, technology, manufacturing, insurance, consulting, healthcare, telecommunications, and the public sector. Complementing this, Strategy Mosaic™ is a universal data layer that enables organizations to achieve a single source of truth across their data. It provides enterprises with consistent definitions and governance across data sources, regardless of where that data resides or which tools access it. AI-powered data modeling hastens data product creation, while Mosaic’s intelligent architecture promotes accelerated performance for all workloads.
Previous wording
The following table presents a roll-forward of our bitcoin holdings, including additional information related to our bitcoin purchases, bitcoin sales (if any), and unrealized gain or loss on digital assets within the respective periods:
Current wording
The following table presents a roll-forward of our bitcoin holdings, including additional information related to our bitcoin purchases, bitcoin sales, and unrealized gain or loss on digital assets within the respective periods:
Previous wording
(b)In the first quarter of 2026, we purchased bitcoin using $2.06 billion of the net proceeds from ATM sales of STRC Stock, $3.3 million of the net proceeds from ATM sales of STRK Stock and $5.19 billion of the net proceeds from ATM sales of class A common stock.
Current wording
(c)In the first quarter of 2026, we purchased bitcoin using $2.06 billion of the net proceeds from ATM sales of STRC Stock, $3.3 million of the net proceeds from ATM sales of STRK Stock and $5.19 billion of the net proceeds from ATM sales of class A common stock.
Previous wording
The amounts reported as “Market Value” in the above table represent only a mathematical calculation consisting of the price for one bitcoin reported on the Coinbase exchange (our principal market for bitcoin) in each scenario defined above multiplied by the number of bitcoins held by us at the end of the applicable period. Bitcoin and bitcoin markets may be subject to manipulation and the spot price of bitcoin may be subject to fraud and manipulation. Accordingly, the Market Value amounts reported above may not accurately represent fair market value, and the actual fair market value of our bitcoin may be different from such amounts and such deviation may be material. Moreover, (i) the bitcoin market historically has been characterized by significant volatility in price, limited liquidity and trading volumes compared to sovereign currencies markets, relative anonymity, a developing regulatory landscape, potential susceptibility to market abuse and manipulation, compliance and internal control failures at exchanges, and various other risks that are, or may be, inherent in its entirely electronic, virtual form and decentralized network and (ii) we may not be able to sell our bitcoins at the Market Value amounts indicated above, at the market price as reported on the Coinbase exchange (our principal market for bitcoin) on the date of sale, or at all.
Current wording
The amounts reported as “Market Value” in the above table represent a mathematical calculation consisting of the price for one bitcoin reported on the Coinbase exchange (our principal market for bitcoin) in each scenario defined above multiplied by the number of bitcoins held by us at the end of the applicable period. Bitcoin and bitcoin markets may be subject to manipulation and the spot price of bitcoin may be subject to fraud and manipulation. Accordingly, the Market Value amounts reported above may not accurately represent fair market value at any given point, and the actual fair market value of our bitcoin may be different from such amounts and such deviation may be material. Moreover, (i) the bitcoin market historically has been characterized by significant volatility in price, limited liquidity and trading volumes compared to sovereign currencies markets, relative anonymity, a developing regulatory landscape, potential susceptibility to market abuse and manipulation, compliance and internal control failures at exchanges, and various other risks that are, or may be, inherent in its entirely electronic, virtual form and decentralized network and (ii) we may not be able to sell our bitcoins at the Market Value amounts indicated above, at the market price as reported on the Coinbase exchange (our principal market for bitcoin) on the date of sale, or at all. The Market Value amount based on the market price of one bitcoin at the end of the applicable period is determined on the same basis as the fair value of our bitcoin recognized in our unaudited consolidated financial statements. See Note 3, Digital Assets, to the Consolidated Financial Statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q.
Previous wording
As of April 26, 2026, we held approximately 818,334 bitcoins, which had an aggregate market value of $64.04 billion as of April 26, 2026 (based on the market price of $78,258 of one bitcoin as reported on the Coinbase exchange as of April 26, 2026, 4:00 p.m. Eastern Time).
Current wording
As of July 24, 2026, we held approximately 843,775 bitcoins, which had an aggregate market value of $54.14 billion, based on the market price of $64,164 of one bitcoin as reported on the Coinbase exchange at 4:00 p.m. Eastern Time on July 24, 2026.
Previous wording
Consistent with our Treasury Reserve Policy and bitcoin strategy, we use the vast majority of our cash, including cash generated from capital raising transactions, to acquire bitcoin. We fund our purchases of bitcoin primarily from proceeds of our offerings of our class A common stock and Preferred Stock instruments. We have also previously used proceeds from offerings of convertible notes and senior secured notes, and a loan secured by bitcoin, to purchase bitcoin, and we may incur additional indebtedness in the future, including for the purpose of purchasing bitcoin.
Current wording
Consistent with our Digital Credit Capital Framework, we use the vast majority of our cash, including cash generated from capital raising transactions, to acquire bitcoin, pay for dividends on our Preferred Stock and interest expense on our Convertible Notes and fund our USD Reserve. We fund our purchases of bitcoin primarily from proceeds of our offerings of our class A common stock and Preferred Stock instruments. We have also previously used proceeds from offerings of convertible notes and senior secured notes, and a loan secured by bitcoin, to purchase bitcoin, and we may incur additional indebtedness in the future, including for the purpose of purchasing bitcoin.
Previous wording
The following table sets forth total shares sold and total net proceeds received from shares sold under our initial public and at-the-market offerings for the periods indicated. For the three months ended March 31, 2026, the amounts presented reflect only shares sold under our at-the-market offerings. For the three months ended March 31, 2025, the amounts include shares sold under both our initial public offerings and ATMs.
Current wording
The following table sets forth total shares sold and total net proceeds received from shares sold under our initial public and ATMs for the periods indicated. For the three and six months ended June 30, 2026, the amounts presented reflect only shares sold under our ATMs. For the three and six months ended June 30, 2025, the amounts include shares sold under both our initial public offerings and ATMs.
Previous wording
From April 1, 2026 to April 26, 2026, we issued and sold 35.1 million additional shares of STRC Stock and 4.5 million additional shares of class A common stock under our ATM for total net proceeds (net of sales commissions and expenses) of approximately $4.24 billion.
Current wording
From July 1, 2026 to July 24, 2026, we sold 13.0 million additional shares of class A common stock under our ATM for total net proceeds (net of sales commissions and expenses) of approximately $1.27 billion. These amounts include sales made during this period that were pending settlement as of July 24, 2026. From July 1, 2026 to July 24, 2026, we repurchased 288,930 shares of STRC Stock under our share repurchase program, for an aggregate purchase price of $25.0 million.
Previous wording
During the three months ended March 31, 2026, we did not complete any new debt offerings. During the three months ended March 31, 2025, we received net proceeds of approximately $1.98 billion from the issuance of our 2030B Convertible Notes. We used the net proceeds from this offering for general corporate purposes, including the acquisition of bitcoin and for working capital.
Current wording
During the three and six months ended June 30, 2026, we did not complete any new debt offerings. During the first quarter of 2025, we received net proceeds of approximately $1.98 billion from the issuance of our 2030B Convertible Notes. We used the net proceeds from this offering for general corporate purposes, including the acquisition of bitcoin and for working capital. In addition, in June 2025, we entered into a loan agreement that provides for aggregate borrowings of up to $31.1 million, available in multiple tranches, and bearing interest, with respect to each tranche, at a variable rate equal to the one-year Secured Overnight Financing Rate plus 4.24%.
Previous wording
•Bitcoin Per Share (in Sats) ("BPS") is a KPI that represents the ratio between our bitcoin holdings and Assumed Diluted Shares Outstanding, expressed in terms of "Satoshis" or "Sats", where:
Current wording
•Bitcoin Per Share (in Sats) ("BPS (in Sats)") represents the ratio between the Company’s gross bitcoin holdings and its Assumed Diluted Shares Outstanding, expressed in terms of “Satoshis” or “Sats”, where:
Previous wording
•“Assumed Diluted Shares Outstanding” refers to the aggregate of our Basic Shares Outstanding as of the dates presented plus all additional shares that would result from the assumed conversion of all outstanding convertible notes and convertible preferred stock, exercise of all outstanding stock option awards, and settlement of all outstanding restricted stock units and performance stock units as of such dates. Assumed Diluted Shares Outstanding is not calculated using the treasury method, incorporates approximate forfeitures of awards in the current period which may be subject to future adjustment and does not take into account any vesting conditions (in the case of equity awards), the exercise price of any stock option awards or any contractual conditions limiting convertibility of convertible debt instruments.
Current wording
◦“Assumed Diluted Shares Outstanding” refers to the aggregate of the Company’s Basic Shares Outstanding as of the dates presented plus all additional shares that would result from the assumed conversion of all outstanding convertible notes and convertible preferred stock, exercise of all outstanding stock option awards, and settlement of all outstanding restricted stock units and performance stock units as of such dates. Assumed Diluted Shares Outstanding is not calculated using the treasury method, incorporates approximate forfeitures of awards in the current period which may be subject to future adjustment and does not take into account any vesting conditions (in the case of equity awards), the exercise price of any stock option awards or any contractual conditions limiting convertibility of convertible debt instruments.
Previous wording
•“Basic Shares Outstanding” reflects the actual class A common stock and class B common stock outstanding as of the dates presented. For purposes of this calculation, outstanding shares of such stock are deemed to include shares, if any, that (A) were sold under ATMs, or (B) were to be issued pursuant to (i) options that had been exercised, (ii) restricted stock units that have vested or (iii) conversion requests received with respect to convertible securities, but which in each case were pending issuance as of the dates presented.
Current wording
◦“Basic Shares Outstanding” reflects the actual class A common stock and class B common stock outstanding as of the dates presented. For purposes of this calculation, outstanding shares of such stock are deemed to include shares, if any, that (A) were sold under at-the-market equity offering programs, or (B) were issued pursuant to (i) options that had been exercised, (ii) restricted stock units that have vested or (iii) conversion requests received with respect to convertible securities, but which in each case were pending issuance as of the dates presented.
Previous wording
•BTC Gain is a KPI that represents the number of bitcoins held by us at the beginning of a period multiplied by the BTC Yield for the period.
Current wording
•BTC Gain represents the gross number of bitcoins held by the Company at the beginning of a period multiplied by the BTC Yield for such period.
Previous wording
•BTC $ Gain is a KPI that represents the dollar value of the BTC Gain calculated by multiplying the BTC Gain by the market price of bitcoin. For determining BTC $ Gain on a quarter-to-date or year-to-date basis, unless otherwise specified, we use the current market price of bitcoin. For determining BTC $ Gain for a past fiscal year or other past period, we use the market price of bitcoin as of 4:00pm ET as reported on the Coinbase exchange on the last day of the applicable period. We use these market prices of bitcoin for this calculation solely for the purpose of facilitating this illustrative calculation.
Current wording
•BTC $ Gain represents the dollar value of the BTC Gain calculated by multiplying the BTC Gain by the market price of bitcoin as reported on the Coinbase exchange as of the applicable measurement time.
Previous wording
We use BPS, BTC Yield, BTC Gain and BTC $ Gain as KPIs to help assess the performance of our strategy of acquiring bitcoin in a manner we believe is accretive to shareholders. We also believe these KPIs can supplement investors’ understanding of how we choose to fund bitcoin purchases and the value created in a period:
Current wording
The Company uses BPS (in Sats), BTC Yield, BTC Gain and BTC $ Gain as KPIs to help assess the performance of its strategy of acquiring bitcoin in a manner it believes to be accretive to shareholders. The Company also believes these KPIs can supplement investors’ understanding of how the Company chooses to fund bitcoin purchases and the value created in a period:
Previous wording
•BPS measures the ratio of our bitcoin holdings to Assumed Diluted Shares Outstanding, which provides management and investors a baseline with which to assess our achievement of our strategy of acquiring bitcoin in an accretive manner over a given period. When evaluating a capital raise transaction, we review this metric and consider the impact such transaction will have on this ratio on a pro forma basis. This metric forms the baseline for our BTC Yield, BTC Gain and BTC $ Gain KPIs, which present changes in BPS from the beginning of a period to the end of the period in different formats, and which we review to assess the performance of our strategy of acquiring bitcoin in a manner we believe to be accretive to shareholders.
Current wording
•BPS (in Sats) measures the ratio of the Company’s gross bitcoin holdings to Assumed Diluted Shares Outstanding, which provides management and investors a baseline with which to assess the Company’s achievement of its strategy of acquiring bitcoin in an accretive manner over a given period. When evaluating a capital raise transaction, the Company reviews this metric and considers the impact such transaction will have on this ratio on a pro forma basis. This metric forms the baseline for the Company’s BTC Yield, BTC Gain and BTC $ Gain KPIs, which present changes in BPS (in Sats) from the beginning of a period to the end of the period in different formats.
Previous wording
A common stock, and would entitle their holders to claims on our assets (including bitcoin) senior to those of holders of our common stock if we were to liquidate; as a result, additional bitcoin acquired using the proceeds from the sale of such instruments may not accrete to common shareholders.
Current wording
•BTC Yield measures the percentage change in BPS (in Sats) from the beginning of a period to the end of a period, which helps management and investors assess how the Company’s achievement of its strategy of acquiring bitcoin in an accretive manner varies across periods. The Company uses BTC Yield to evaluate whether its capital markets activity and bitcoin acquisition strategy has resulted in gross per-share accretion (or dilution) on an Assumed Diluted Shares Outstanding basis over an applicable period, and to compare the impact of its strategy across periods. While issuances of STRF Stock, STRC Stock, STRE Stock and STRD Stock do not increase our Assumed Diluted Shares Outstanding, these securities, as well as STRK Stock and our Outstanding Convertible Notes, rank senior to our class A common stock, and would entitle their holders to claims on our assets (including bitcoin) senior to those of holders of our common stock if we were to liquidate; as a result, additional bitcoin acquired using the proceeds from the sale of such instruments may not accrete to common shareholders.
Previous wording
•BTC Gain hypothetically expresses the percentage change reflected in the BTC Yield metric as if it reflected an increase in the amount of bitcoin held at the end of the applicable period as compared to the beginning of such period, which provides management and investors with visibility into the absolute change in our bitcoin holdings resulting from our BTC Yield. We use BTC Gain to measure the accretive or dilutive impact of the change in BPS over an applicable period in absolute terms relative to our bitcoin holdings. This metric can be particularly helpful when comparing the execution of our capital markets strategy across periods, as BTC Yield may be lower when our bitcoin asset base is larger, but result in the same BTC Gain. For example, a 10% BTC Yield with a starting amount of 100,000 bitcoin will result in 10,000 BTC Gain, which is the same BTC Gain that would result from 5% BTC Yield with a starting amount of 200,000 bitcoin.
Current wording
•BTC Gain hypothetically expresses the percentage change reflected in the BTC Yield metric as if it reflected an increase in the amount of bitcoin held at the end of the applicable period as compared to the beginning of such period, which provides management and investors with visibility into the absolute change in the Company’s bitcoin holdings resulting from the Company’s BTC Yield. The Company uses BTC Gain to measure the accretive or dilutive impact of the change in BPS (in Sats) over an applicable period in absolute terms relative to the Company’s bitcoin holdings. This metric can be particularly helpful when comparing the execution of the Company’s capital markets strategy across periods, as BTC Yield may be lower when the Company’s bitcoin asset base is larger, but result in the same BTC Gain. For example, a 10% BTC Yield with a starting amount of 100,000 bitcoin will result in 10,000 BTC Gain, which is the same BTC Gain that would result from 5% BTC Yield with a starting amount of 200,000 bitcoin.
Previous wording
•BTC $ Gain further expresses the percentage change reflected in the BTC Yield metric as an illustrative dollar value by multiplying that bitcoin-denominated change by the market price of bitcoin at the end of the applicable period as described above. We refer to this metric for illustrative purposes to consider the magnitude of our BTC Gain for an applicable period with reference to the market price of bitcoin as of the end of an applicable period.
Current wording
•BTC $ Gain further expresses the percentage change reflected in the BTC Yield metric as an illustrative dollar value by multiplying that bitcoin-denominated change by the market price of bitcoin at the end of the applicable period as described above. The Company refers to this metric for illustrative purposes to consider the magnitude of the Company’s BTC Gain for an applicable period with reference to the market price of bitcoin as of the end of an applicable period.
Previous wording
When we present these KPIs for any period (a "Measurement Period") that is a subdivision of a longer specified period (the "reference period"), (i) BTC Yield is calculated as the BTC Yield for the period from the beginning of the reference period to the end of the Measurement Period, less the BTC Yield for the period from the beginning of the reference period to the beginning of the Measurement Period, (ii) BTC Gain is calculated using the BTC Yield for the Measurement Period and our bitcoin holdings at the beginning of the reference period rather than at the beginning of the Measurement Period, and (iii) BTC $ Gain is calculated by multiplying such revised BTC Gain by the market price of bitcoin at the end of the Measurement Period. When we present these metrics for an interim period within a fiscal year (e.g., a monthly, quarterly, or quarter-to-date period), then the reference period is that fiscal year, unless stated otherwise.
Current wording
When the Company presents these KPIs for any period (a “measurement period”) that is a subdivision of a longer specified period (the “reference period”), (i) BTC Yield is calculated as the BTC Yield for the period from the beginning of the reference period to the end of the measurement period, less the BTC Yield for the period from the beginning of the reference period to the beginning of the measurement period, (ii) BTC Gain is calculated using the BTC Yield for the measurement period and the Company’s bitcoin holdings at the beginning of the reference period rather than at the beginning of the measurement period, and (iii) BTC $ Gain is calculated by multiplying such revised BTC Gain by the market price of bitcoin at the end of the measurement period. When the Company presents these metrics for an interim period within a fiscal year (e.g., a monthly, quarterly, or quarter-to-date period), then the reference period is that fiscal year, unless stated otherwise.
Previous wording
For example, if BPS is 100 at the beginning of a fiscal year (the reference period), 110 at the end of the first quarter and 125 at the end of the second quarter, the BTC Yield for the second quarter (the Measurement Period) is calculated as (125/100 − 1) less (110/100 − 1), or 15%—reflecting the 15-point BPS increase from 110 to 125 expressed against the reference period starting BPS of 100. The sum of the first quarter BTC Yield (10%) and the second quarter BTC Yield (15%) equals the year-to-date BTC Yield of 25% (125/100 − 1). See "Important Information about KPIs" for additional information.
Current wording
For example, if BPS (in Sats) is 100 at the beginning of a fiscal year (the reference period), 110 at the end of the first quarter and 125 at the end of the second quarter, the BTC Yield for the second quarter (the applicable measurement period) is calculated as (125/100 − 1) less (110/100 − 1), or 15%—reflecting the 15-point BPS (in Sats) increase from 110 to 125 expressed against the reference period starting BPS (in Sats) of 100. The sum of the first quarter BTC Yield (10%) and the second quarter BTC Yield (15%) equals the year-to-date BTC Yield of 25% (125/100 − 1). See "Important Information about KPIs" for additional information.
Previous wording
The following table presents our bitcoin holdings, our Assumed Diluted Shares Outstanding, our BPS, and the price of bitcoin, each as of March 31, 2026 and 2025, as well as the changes in each between the periods shown:
Current wording
The following table presents our bitcoin holdings, our Assumed Diluted Shares Outstanding, our BPS (in Sats), and the price of bitcoin, each as of June 30, 2026 and 2025, as well as the changes in each between the periods shown:
Previous wording
The following tables present our BTC Yield, BTC Gain, and BTC $ Gain for the three months ended March 31, 2026 and 2025:
Current wording
The following tables present our BTC Yield, BTC Gain, and BTC $ Gain for the three and six months ended June 30, 2026 and 2025:
Previous wording
•BTC Yield: We achieved BTC Yield of 3.2% for the three months ended March 31, 2026, as compared to 11.0% during the same period in the prior year. This decrease was primarily due to (i) a substantially larger bitcoin balance as of December 31, 2025 compared to December 31, 2024, which increased the denominator in the BTC Yield calculation and made higher yield percentages more difficult to achieve and (ii) our class A common stock trading at a lower premium relative to the value of our underlying bitcoin holdings during the three months ended March 31, 2026 as compared to prior year period, which reduced the BTC Yield attributable to class A common stock issuances used to purchase bitcoin. Such factors were partially offset by a change in mix of dilutive versus non-dilutive issuances to acquire bitcoin compared to the prior year period and an increase in total bitcoin acquired during the quarter compared to the prior year period.
Current wording
•BTC Yield: We achieved BTC Yield of 5.0% and 8.1% for the three and six months ended June 30, 2026, respectively, as compared to 8.7% and 19.7% during the same periods in the prior year. These decreases were primarily due to (i) a substantially larger bitcoin balance as of March 31, 2026 and December 31, 2025 compared to the corresponding prior-year dates, which increased the numerator in the BPS (in Sats) calculation and made higher BTC Yield percentages more difficult to achieve, (ii) our class A common stock trading at a lower premium relative to the value of our underlying bitcoin holdings during the three and six months ended June 30, 2026 as compared to same periods from prior year, which reduced the BTC Yield attributable to class A common stock issuances used to purchase bitcoin, (iii) an increase in sales of our class A common stock for purposes other than purchasing bitcoin in the current periods, including for funding the USD Reserve and paying for dividends on our Preferred Stock and interest expense on our Convertible Notes, and (iv) sales of 1,395 bitcoins during the three months ended June 30, 2026. These factors were partially offset by increased sales of Preferred Stock during the three and sixth months ended June 30, 2026, which netted proceeds of $5.46 billion and $7.52 billion, respectively, which we used to purchase 72,408 and 100,438 bitcoins, respectively, during these periods, as compared to sales of Preferred Stock during the three and six months ended June 30, 2025, which netted proceeds of $1.61 billion and $2.95 billion, respectively, and corresponding purchases of 15,212 and 29,661 bitcoin, respectively.
Previous wording
•BTC Gain: We achieved BTC Gain of 21,329 for the three months ended March 31, 2026, as compared to 49,132 during the same period in the prior year, as applicable, primarily due to a decrease in our BTC Yield for the three months ended March 31, 2026, as compared to the same period in the prior year, as set forth above, partially offset by an increase in our bitcoin holdings as of the beginning of 2026 compared to the beginning of 2025 (as of December 31, 2025 and 2024, we held 672,500 and 447,470 bitcoin, respectively).
Current wording
•BTC Gain: We achieved BTC Gain of 37,733 and 54,625 for the three and six months ended June 30, 2026, respectively, as compared to 46,008 and 88,109 during the same periods in the prior year, as applicable, primarily due to a decrease in our BTC Yield for the three and six months ended June 30, 2026, as compared to the same periods in the prior year, as set forth above, partially offset by an increase in our bitcoin holdings as of the beginning of 2026 compared to the beginning of 2025 (as of December 31, 2025 and 2024, we held 672,500 and 447,470 bitcoin, respectively).
Previous wording
•BTC $ Gain: We achieved BTC $ Gain of approximately $1.45 billion for the three months ended March 31, 2026, as compared to approximately $4.05 billion during the same period in the prior year, primarily due to a decrease in bitcoin price to $67,773 as of March 31, 2026 from $82,445 as of March 31, 2025, as well as a decrease in BTC Gain compared to the same period in the prior year, as set forth above.
Current wording
•BTC $ Gain: We achieved BTC $ Gain of approximately $2.22 billion and $3.21 billion for the three and six months ended June 30, 2026, respectively, as compared to approximately $4.96 billion and $9.49 billion during the same periods in the prior year, primarily due to a decrease in bitcoin price to $58,714 as of June 30, 2026 from $107,752 as of June 30, 2025, as well as a decrease in BTC Gain compared to the same periods in the prior year, as set forth above.
Previous wording
◦Financial results. Bitcoin is a highly volatile asset that has traded below $65,000 per bitcoin and above $120,000 per bitcoin on the Coinbase exchange (our principal market for bitcoin) in the 12 months preceding March 31, 2026. Although we continue to initially record our bitcoin purchases at cost, upon adoption of ASU 2023-08 on January 1, 2025, any subsequent increases or decreases in fair market value are recognized as incurred in the Consolidated Statements of Operations, and the fair value of our bitcoin is reflected within the Consolidated Balance Sheets each reporting period-end. Due to the volatility of bitcoin, and our substantial holdings of bitcoin, changes in the fair market value of bitcoin have materially impacted, and we expect will continue to materially impact, our results.
Current wording
◦Financial results. Bitcoin is a highly volatile asset that has traded below $60,000 per bitcoin and above $120,000 per bitcoin on the Coinbase exchange (our principal market for bitcoin) in the 12 months preceding June 30, 2026. Although we continue to initially record our bitcoin purchases at cost, upon adoption of ASU 2023-08 on January 1, 2025, any subsequent increases or decreases in fair market value are recognized as incurred in the Consolidated Statements of Operations, and the fair value of our bitcoin is reflected within the Consolidated Balance Sheets each reporting period-end. Due to the volatility of bitcoin, and our substantial holdings of bitcoin, changes in the fair market value of bitcoin have materially impacted, and we expect will continue to materially impact, our results.
Previous wording
◦Bitcoin risks. Bitcoin is a digital asset, which is a novel asset class that is subject to significant legal, commercial, regulatory and technical uncertainty. Holding bitcoin does not generate any cash flows and involves custodial fees and other costs. Additionally, the price of bitcoin has historically experienced significant price volatility, and a significant decrease in the price of bitcoin would adversely affect our financial condition and results of operations. Our strategy of acquiring and holding bitcoin also exposes us to counterparty risks with respect to the custody of our bitcoin, cybersecurity risks, and other risks inherent to holding a digital asset. In particular, we are subject to the risk that, if our private keys with respect to our digital assets are lost or destroyed or other similar circumstances or events occur, we may lose some or all of our digital assets, which could materially adversely affect our financial condition and results of operations.
Current wording
▪Counterparty, cybersecurity and custody risks: Our strategy of acquiring and holding bitcoin exposes us to counterparty risks with respect to the custody of our bitcoin, cybersecurity risks, and other risks inherent to holding a digital asset. In particular, we are subject to the risk that, if our private keys with respect to our digital assets are lost or destroyed or other similar circumstances or events occur, we may lose some or all of our digital assets, which could materially adversely affect our financial condition and results of operations.
Previous wording
◦Source of capital. We rely substantially on the availability of equity and debt capital markets to fund our preferred stock dividend obligations, interest expense, and other financial obligations as well as to maintain the USD Reserve at current levels. As such, we are subject to risks relating to the availability of capital to us on favorable terms or at all.
Current wording
◦Source of capital. We rely substantially on the availability of equity and debt capital markets to fund our preferred stock dividend payments, interest expense, and other financial obligations as well as to maintain the USD Reserve at current levels. We may also sell bitcoin pursuant to our board-authorized bitcoin monetization program to satisfy these obligations. As such, we are subject to risks relating to the availability of capital to us on favorable terms or at all, as well as our ability to sell bitcoin at attractive prices.
Previous wording
◦Preferred stock dividend obligations. Our outstanding Preferred Stock creates recurring and potentially variable cash obligations that can reduce funds available for operations, product investment, and debt service. In addition, any deferred dividends on certain of our Preferred Stock would accrue and compound, including at increasing rates in the case of STRF Stock, which could increase future cash outlays, while STRC Stock’s board-set variable rate can change monthly, introducing additional uncertainty to our dividend expense.
Current wording
◦Preferred stock dividend payments. Our outstanding Preferred Stock creates recurring and potentially variable cash obligations that can reduce funds available for operations, product investment, and debt service. In addition, any deferred dividends on certain of our Preferred Stock would accrue and compound, including at increasing rates in the case of STRF Stock, which could increase future cash outlays, while STRC Stock’s board-set variable rate can change monthly, introducing additional uncertainty to our expected dividend payments.
Previous wording
◦Deferred taxes. Since adopting ASU 2023-08, we are no longer required to account for our bitcoin under a cost-less-impairment accounting model and no longer record deferred tax assets related to bitcoin impairment losses. Instead, we establish a deferred tax liability if the fair market value of bitcoin at the reporting date exceeds the average cost basis of our bitcoin holdings at such reporting date, and subsequent increases or decreases in the fair market value of bitcoin increase or decrease the deferred tax liability. If the fair market value of our bitcoin as of the end of any reporting period is below its average cost basis as of the end of the prior period, the deferred tax liability with respect to unrealized gains, if any, would be reversed, a deferred tax asset for the unrealized loss would be recorded, and we would be required to establish a valuation allowance against our U.S. federal and state deferred tax assets. As of March 31, 2026, the market value of bitcoin had declined to the point where the cost basis of our bitcoin holdings exceeded their fair market value. During the three months ended March 31, 2026, the deferred tax liability recognized as of December 31, 2025 was reversed, a deferred tax asset related to unrealized losses on bitcoin holdings was recorded, and a full valuation allowance on all of our domestic net deferred tax assets was established. See Note 7, Income Taxes, to the Consolidated Financial Statements included in Part I, Item 1 of this Quarterly Report for additional information.
Current wording
◦Deferred taxes. Since adopting ASU 2023-08, we are no longer required to account for our bitcoin under a cost-less-impairment accounting model and no longer record deferred tax assets related to bitcoin impairment losses. Instead, we establish a deferred tax liability if the fair market value of bitcoin at the reporting date exceeds the average cost basis of our bitcoin holdings at such reporting date, and subsequent increases or decreases in the fair market value of bitcoin increase or decrease the deferred tax liability. If the fair market value of our bitcoin as of the end of any reporting period is below its average cost basis as of the end of the prior period, the deferred tax liability with respect to unrealized gains, if any, would be reversed, a deferred tax asset for the unrealized loss would be recorded, and we would be required to establish a valuation allowance against our U.S. federal and state deferred tax assets. As of June 30, 2026, the market value of bitcoin had declined to the point where the cost basis of our bitcoin holdings exceeded their fair market value. During the six months ended June 30, 2026, the deferred tax liability recognized as of December 31, 2025 was reversed, a deferred tax asset related to unrealized losses on bitcoin holdings was recorded, and a full valuation allowance on all of our domestic net deferred tax assets was established. As of June 30, 2026, the market value of bitcoin has remained below our cost basis, and we remain in a net deferred tax asset position; however, due to the full valuation allowance on all our domestic net deferred tax assets, no net deferred tax benefit is reflected in our financial statements. See Note 8, Income Taxes, to the Consolidated Financial Statements included in Part I, Item 1 of this Quarterly Report for additional information.
Previous wording
▪OBBBA: On July 4, 2025, the One Big Beautiful Bill Act was enacted in the U.S., introducing several changes to corporate taxation. These changes include modifications to capitalization of research and development expenses, limitations on deductions for interest expense, accelerated fixed asset depreciation, and adjustments to the international tax framework. The legislation did not have a material impact to our income tax expense or effective tax rate for the three months ended March 31, 2026.
Current wording
▪OBBBA: On July 4, 2025, the One Big Beautiful Bill Act was enacted in the U.S., introducing several changes to corporate taxation. These changes include modifications to capitalization of research and development expenses, limitations on deductions for interest expense, accelerated fixed asset depreciation, and adjustments to the international tax framework. The legislation did not have a material impact to our income tax expense or effective tax rate for the three or six months ended June 30, 2026.
Previous wording
◦On-premise to cloud subscription. During the three months ended March 31, 2026, we continued to migrate existing customers from on-premise perpetual licenses to cloud-based subscription offerings. This transition has resulted, and is expected to continue to result, in changes to payment patterns and revenue recognition, with a shift from upfront recognition to ratable recognition over the contract term, which has affected and may continue to affect our reported revenue, operating results, and cash flows. For the three months ended March 31, 2026, we experienced growth in cloud subscription services revenue of $21.8 million, partially offset by declines in product license revenue and related product support revenue of $10.1 million in the aggregate. We expect product license revenue and related product support revenue to continue to decline in future periods, as we no longer actively market new perpetual licenses or associated product support offerings.
Current wording
◦On-premise to cloud subscription. During the three and six months ended June 30, 2026, we continued to migrate existing customers from on-premise perpetual licenses to cloud-based subscription offerings. This transition has resulted, and is expected to continue to result, in changes to payment patterns and revenue recognition, with a shift from upfront recognition to ratable recognition over the contract term, which has affected and may continue to affect our reported revenue, operating results, and cash flows. For the three and six months ended June 30, 2026, we experienced growth in cloud subscription services revenue of $22.0 million and $43.8 million, respectively, partially offset by declines in product license revenue and related product support revenue of $15.3 million and $25.5 million in the aggregate, respectively. We expect product license revenue and related product support revenue to continue to decline in future periods, as we no longer actively market new perpetual licenses or associated product support offerings.
Previous wording
We recognized an unrealized loss on digital assets of approximately $14.46 billion and $5.91 billion for the three months ended March 31, 2026 and 2025, respectively, primarily due to a decrease in the fair market value of our bitcoin. Due to the volatility of bitcoin, and our substantial holdings of bitcoin, we expect changes in the fair market value of bitcoin to materially impact our results.
Current wording
We recognized an unrealized loss on digital assets of approximately $8.32 billion and $22.77 billion for the three and six months ended June 30, 2026, respectively. We recognized an unrealized gain on digital assets of approximately $14.05 billion and $8.14 billion for the three and six months ended June 30, 2025, respectively. Due to the volatility of bitcoin, and our substantial holdings of bitcoin, we expect changes in the fair market value of bitcoin to materially impact our results in future periods.
Previous wording
•Subscription services revenues. Subscription services revenues are derived from our Cloud subscription service and are recognized ratably over the service period in the contract. Subscription services revenues increased by $21.8 million for the three months ended March 31, 2026, as compared to the same period in the prior year, primarily due to conversions to cloud-based subscriptions from existing on-premises customers, a net increase in the use of subscription services by existing customers, and sales contracts with new customers.
Current wording
•Subscription services revenues. Subscription services revenues are derived from our Cloud subscription service and are recognized ratably over the service period in the contract. Subscription services revenues increased by $22.0 million and $43.8 million for the three and six months ended June 30, 2026, respectively, as compared to the same periods in the prior year, primarily due to conversions to cloud-based subscriptions from existing on-premises customers, a net increase in the use of subscription services by existing customers, and sales contracts with new customers.
Previous wording
•Product support revenues. Product support revenues are derived from providing technical software support and software updates and upgrades to customers. Product support revenues are recognized ratably over the term of the contract, which is generally one year. Product support revenues decreased by $8.3 million for the three months ended March 31, 2026, as compared to the same period in the prior year, primarily due to existing customers converting from on-premises product licenses with support contracts to our Cloud subscription services offerings and non-renewals of existing support contracts.
Current wording
•Product support revenues. Product support revenues are derived from providing technical software support and software updates and upgrades to customers. Product support revenues are recognized ratably over the term of the contract, which is generally one year. Product support revenues decreased by $11.8 million and $20.2 million for the three and six months ended June 30, 2026, respectively, as compared to the same periods in the prior year, primarily due to existing customers converting from on-premises product licenses with support contracts to our Cloud subscription services offerings and non-renewals of existing support contracts.
Previous wording
•Sales and marketing expenses. Sales and marketing expenses consist of personnel costs, commissions, and costs related to office facilities, travel, advertising, public relations programs, and promotional events, such as trade shows, seminars, and technical conferences. Sales and marketing expenses increased by $8.7 million for the three months ended March 31, 2026, as compared to the same period in the prior year, primarily driven by increased commission expense, as well as higher promotional event costs associated with the timing of our annual Strategy World conference, which occurred in the first quarter of 2026 as compared to the second quarter of 2025.
Current wording
•Sales and marketing expenses. Sales and marketing expenses consist of personnel costs, commissions, and costs related to office facilities, travel, advertising, public relations programs, and promotional events, such as trade shows, seminars, and technical conferences. Sales and marketing expenses increased by $3.0 million and $10.7 million for the three and six months ended June 30, 2026, respectively, as compared to the same periods in the prior year, primarily reflecting higher commission expense in connection with increased sales activity, as well as higher personnel and recruiting costs and higher spending on promotional events.
Showing the first 40 of 93 pairs. Open the source sections for the rest.
Rearranged current paragraphs (8)
Current report — wording carried from elsewhere
◦Bitcoin risks. Bitcoin is a digital asset, which is a novel asset class that is subject to significant legal, commercial, regulatory and technical uncertainty.
Current report — wording carried from elsewhere
▪No cash flows: Holding bitcoin does not generate any cash flows and involves custodial fees and other costs.
Current report — wording carried from elsewhere
▪Volatility: The price of bitcoin has historically experienced significant price volatility, and a significant decrease in the price of bitcoin would adversely affect our financial condition and results of operations.
Current report — wording carried from elsewhere
BTC $ Gain represents the dollar value of the BTC Gain calculated by multiplying the BTC Gain by the market price of bitcoin as reported on the Coinbase exchange as of the applicable measurement time.
Current report — wording carried from elsewhere
The Company uses BPS (in Sats), BTC Yield, BTC Gain and BTC $ Gain as KPIs to help assess the performance of its strategy of acquiring bitcoin in a manner it believes to be accretive to shareholders. The Company also believes these KPIs can supplement investors’ understanding of how the Company chooses to fund bitcoin purchases and the value created in a period:
Current report — wording carried from elsewhere
•BPS (in Sats) measures the ratio of the Company’s gross bitcoin holdings to Assumed Diluted Shares Outstanding, which provides management and investors a baseline with which to assess the Company’s achievement of its strategy of acquiring bitcoin in an accretive manner over a given period. When evaluating a capital raise transaction, the Company reviews this metric and considers the impact such transaction will have on this ratio on a pro forma basis. This metric forms the baseline for the Company’s BTC Yield, BTC Gain and BTC $ Gain KPIs, which present changes in BPS (in Sats) from the beginning of a period to the end of the period in different formats.
Current report — wording carried from elsewhere
•BTC Gain hypothetically expresses the percentage change reflected in the BTC Yield metric as if it reflected an increase in the amount of bitcoin held at the end of the applicable period as compared to the beginning of such period, which provides management and investors with visibility into the absolute change in the Company’s bitcoin holdings resulting from the Company’s BTC Yield. The Company uses BTC Gain to measure the accretive or dilutive impact of the change in BPS (in Sats) over an applicable period in absolute terms relative to the Company’s bitcoin holdings. This metric can be particularly helpful when comparing the execution of the Company’s capital markets strategy across periods, as BTC Yield may be lower when the Company’s bitcoin asset base is larger, but result in the same BTC Gain. For example, a 10% BTC Yield with a starting amount of 100,000 bitcoin will result in 10,000 BTC Gain, which is the same BTC Gain that would result from 5% BTC Yield with a starting amount of 200,000 bitcoin.
Current report — wording carried from elsewhere
•BTC $ Gain further expresses the percentage change reflected in the BTC Yield metric as an illustrative dollar value by multiplying that bitcoin-denominated change by the market price of bitcoin at the end of the applicable period as described above. The Company refers to this metric for illustrative purposes to consider the magnitude of the Company’s BTC Gain for an applicable period with reference to the market price of bitcoin as of the end of an applicable period.