MicroStrategy Reports Record $12.5 Billion Loss in Q1 2026 on Bitcoin Markdowns

MicroStrategy Inc. reported a net loss of $12.54 billion for the first quarter of 2026, the largest in its history, after booking a $14.46 billion unrealized markdown on its Bitcoin (BTC) holdings. The company continued to expand its bitcoin position despite the drawdown. Holdings rose to 818,334 BTC, up 22% since January. As of May 3, MicroStrategy's digital assets were valued at $64.14 billion. The average cost basis was $75,537 per coin, compared with a May 1 market price around $78,374. Under the firm's proprietary metrics, it posted a 9.4% BTC Yield year-to-date, representing 63,410 additional bitcoin and about $4.97 billion in illustrative gains for shareholders. The company also led U.S. equity issuance in 2026, raising $11.68 billion year-to-date. STRC, MicroStrategy's Variable Rate Series A Perpetual Stretch Preferred Stock, has scaled to an $8.5 billion market capitalization in nine months. Daily trading volume is near $375 million, with realized volatility of 3%. The instrument has raised $5.58 billion year-to-date, up 189%. Cumulative dividends across all preferred series total $692.5 million, paid over 23 consecutive distributions. Shareholders are voting on a proposal to move STRC payments to a semimonthly schedule, which management says would support liquidity and price stability. MicroStrategy's software business remained steady. Analytics revenue increased 11.9% to $124.3 million in the quarter, gross margin held at 67.1%, and cash reserves ended Q1 at $2.21 billion. The next quarterly results are expected to be influenced by bitcoin's price trajectory and ongoing demand for the company's preferred stock offerings.