Strategy Reports $19.53 Billion Net Income as Quarterly Revenue Falls 3%
Key Facts
Strategy reported on October 29 that net income was $19.53 billion for the three months ended September 30, 2026, with diluted earnings of $44.75 per share. Net income rose from $2.79 billion in the third quarter of 2025, according to the company statement accompanying its filing. But the jump does not reflect comparable growth in operating revenue: quarterly revenue fell 3% to $125.4 million from $128.7 million a year earlier. The gap highlights the effect of digital-asset remeasurement gains on the accounting result compared with revenue performance. Income attributable to common shareholders was also $19.12 billion after accounting for preferred stock dividends.
Preferred stock dividends totaled $419.6 million in the quarter, compared with $139.9 million in the year-earlier period, when net income attributable to common shareholders was $2.65 billion. These figures show that reported net income and earnings per share are not the same as the amount attributable to common shareholders after dividends. The previous quarter had recorded a net loss attributable to common shareholders of $8.62 billion, after $400.7 million in preferred dividends. In the second quarter of 2025, the company instead recorded income attributable to common shareholders of $9.97 billion. The quarter-to-quarter comparison reflects the volatility of results as the value of digital assets recorded in income changes.
The company attributed operating income of $20.91 billion to a gain of the same amount on its digital assets during the third quarter of 2026. The digital-asset gain and comparable operating income were $3.89 billion in the third quarter of 2025. The company said accounting standard ASU 2023-08 requires bitcoin to be measured at fair value at the end of the period, with changes recognized in the period’s net income or loss. The expansion in operating income this quarter is therefore tied to remeasurement of digital assets, not a comparable increase in revenue. Gross profit fell to $89.6 million from $90.7 million a year earlier, despite the gross margin rising to 71% from 70%.
Strategy held about 848,517 bitcoin as of October 25, up 26% since the start of 2026, while the stated market value of its digital assets was $68.90 billion. The company estimated the original cost basis of its holdings at $64.02 billion on the same date. The chief executive said the company raised $21 billion in capital through equity and increased its bitcoin holdings 26% since the start of the year, in what he described as a challenging market. In the third quarter alone, the company’s net proceeds from its at-the-market offering program were $5.41 billion. It also said it had sold about $431.8 million of bitcoin since the start of the year to help fund part of its preferred stock dividends and STRC repurchases.
On liquidity, cash and cash equivalents were $2.50 billion on September 30, up from $1.71 billion on June 30. Short-term investments were $3.40 billion, compared with $736.1 million at the end of June. The company said MSTR shares rose 76% in the third quarter, compared with a 43% increase in bitcoin’s price. But the stock closed at $130.51 on October 30, down from $141.62 in the previous session, according to EL7 data. The figures show the stock and bitcoin moved by different percentages during the quarter, followed by a lower stock close in the latest session in the available data.
On dividends, Strategy said it will begin paying daily dividends on STRC on November 1, 2026, followed by STRF, STRK and STRD on January 1, 2027. The company expects distributions on its preferred instruments to be treated as a non-taxable return of capital for the foreseeable future, which it defined as ten years or more. It also announced that Andrew Kang will leave his position as chief financial officer on November 5, 2026, with Reza Verasteh taking over the role on January 1, 2027. During the transition, Fong Lee will serve as principal financial officer. These dates put management changes and the dividend schedule among the main upcoming steps listed in the announcement.