Strategy Inc (MSTR)

Strategy Inc reported third-quarter 2026 revenue of $125.4 million on 29 October, down 3 percent from a year earlier 1. Net income was $19.53 billion, or $44.75 per diluted share, driven by a $20.91 billion gain on its digital assets, which are its bitcoin 1.

All of its revenue came from software, and the 10-Q ties the swing in net income to gains and losses on its digital assets, not to the software business 3. Over the first nine months of 2026 the company still shows a net loss of $1.23 billion 3.

On 25 October 2026 it held about 848,517 bitcoin 1. In the third quarter it purchased 7,218 bitcoin and sold 5,552 to pay preferred dividends and repurchase its STRC preferred stock 3.

Chief Financial Officer Andrew Kang told the company on 26 October that he intends to resign effective 5 November 2026, for personal reasons 2. Phong Le, the chief executive, serves as principal financial officer from 6 November, and Reza Virasteh becomes CFO on 1 January 2027 2.

Shareholders approved daily dividends on four preferred stocks on 28 October, with 381,373,199 votes for and 2,236,551 against 4. The change starts with STRC from 1 November, and the other three follow from 1 January 2027 4.

The company says cash from its software operations is not expected to cover its needs, so it relies on other sources such as its at-the-market stock sales 3.

Strategy was called MicroStrategy until 11 August 2025, when it changed its name 6. Its original business is business intelligence software, which helps organizations build, explore and act on their data 6.

Software revenue was $477.2 million in 2025 and $463.5 million in 2024 6.

Customers have been moving from on-premises licenses, installed on their own servers, to cloud subscriptions 6. In 2025 subscription revenue rose $68.9 million while product support fell $39.6 million, and the 10-K ties both to customers converting to the cloud 6.

The company announced its first bitcoin purchase in August 2020, and in September 2020 its board adopted a Treasury Reserve Policy naming bitcoin the primary treasury reserve asset 6. In the first quarter of 2021 it added a strategy of acquiring and keeping bitcoin, including with money raised from investors 6.

Before 2025 it paid for bitcoin mainly with sales of class A common stock and convertible notes, which are loans that can turn into shares 6. In 2025 it issued five classes of preferred stock that it calls digital credit 6.

Its bitcoin count rose from 447,470 at the start of 2025 to 672,500 at the start of 2026 3.

A change in accounting rules took effect on 1 January 2025, so bitcoin is carried at fair value and every change in that value runs through the income statement 6. The company recorded a loss on digital assets of $5.40 billion for 2025 and a loss from operations of $5.44 billion, against $1.79 billion of impairment losses in 2024 6.

Quarterly results then swung with bitcoin 3. The company recorded a loss on digital assets of $14.46 billion in the first quarter of 2026 and $8.32 billion in the second, then a gain of $20.91 billion in the third 3.

The 10-K says it sold no bitcoin in 2025 or 2024 6. In the second quarter of 2026 it began to sell some, 1,395 bitcoin, and in June its board adopted the Digital Credit Capital Framework, a set of policies built around a U.S. dollar reserve 3.

In the first nine months of 2026 it also repurchased $1.50 billion of principal of its 0% convertible notes due 2029 for $1.38 billion in cash 3. In June 2026 its board authorized the repurchase of its preferred stock 3.

The bitcoin treasury

Strategy calls itself the world's first and largest Bitcoin Treasury Company, one that pursues financial innovation strategies built on its bitcoin holdings 3. Bitcoin is its primary treasury reserve asset, kept beside spare cash 3.

It reported 847,666 bitcoin at 30 September 2026, up from 672,500 at the end of 2025, all of it unencumbered, meaning not pledged to lenders 3. Its bitcoin segment earns no revenue 3.

From 26 October to 1 November 2026 it purchased 811 bitcoin for $65.5 million, bringing its total to 849,327 5. The company says it plans to keep accumulating bitcoin and has set no fixed amount to reach 3.

Three custodians keep the bitcoin: Coinbase Custody with 354,348 bitcoin (42 percent), Anchorage with 326,554 (38 percent) and Fidelity with 167,615 (20 percent) 3.

The segment reported net income of $19.01 billion in the third quarter, almost all of it the gain on digital assets 3.

Digital credit: the preferred stocks

Preferred stock is a share class that pays set dividends ahead of common shares 6. Strategy calls its versions digital credit and designed each to suit a different kind of investor 6.

STRF, STRK and STRD pay 10.00, 8.00 and 10.00 percent a year, STRE pays 10.00 percent in euros, and STRC pays a variable rate the company sets 6. The company keeps the STRC rate at 12.00 percent 1.

In the first nine months of 2026 it raised $21.16 billion net from at-the-market sales, which are shares sold gradually through brokers 3. Of that, $13.64 billion came from class A common stock and $7.52 billion from STRC 3.

As of 25 October it reported U.S. dollar assets of $5.07 billion, which it says gives 3.4 years of coverage on dividend and interest obligations 1. Year to date it repurchased 20,980,508 STRC shares for about $2.04 billion 1.

It reports $1.48 billion of cumulative dividends paid on all its preferred stock to date 1. The company also has convertible notes outstanding, with $1.01 billion due in 2028 and $1.50 billion due in 2029 3.

The rest are $800 million of 2030A notes, $2.00 billion of 2030B notes, $603.7 million due in 2031 and $800 million due in 2032 3.

Enterprise analytics software

Strategy One is an AI-powered business intelligence platform that combines interactive dashboards, enterprise reports, AI agents and embedded analytics in one product 6. Mosaic is a data layer that gives a company one set of definitions across its data sources 6.

An assistant called Auto turns plain-language questions into reports and dashboards, and the platform runs on Amazon, Microsoft and Google clouds 6. Customers are in retail, banking, technology, manufacturing, insurance, healthcare and the public sector 3.

In the third quarter subscription services brought in $68.6 million, product support $37.7 million, other services $15.3 million and product licenses $3.8 million 3.

Gross profit was $89.6 million, a 71 percent margin, meaning 71 cents of each revenue dollar was left after the costs of delivering the product 1. Software net income was $519.3 million, helped by a $503.5 million income tax benefit 3.

Strategy sells mainly through its own sales force and through partners including AWS, Microsoft, STACKIT and Google 6. Cloud subscriptions typically run 36 months, and full support for on-premises licenses ends on 31 December 2026 6.

Rivals

In enterprise analytics the 10-K names IBM, Microsoft, Oracle, Salesforce and SAP as competitors 6. For investor money, it names exchange-traded products, bitcoin miners and other companies that keep bitcoin as a treasury reserve 6.

People and control

Phong Le is president and chief executive, and Michael Saylor is founder and executive chairman 1. Kang leaves on 5 November, and Shelley Khanna, the global controller, becomes chief accounting officer on 6 November 2.

Virasteh, age 50, has been with the company since 2008 and has been executive vice president of operations since January 2024 2. At the end of 2025 the company had 1,539 employees, 448 of them in the United States 6.

Saylor beneficially owned 19,616,680 class B shares at 30 September 2026, worth 32.8 percent of total votes, because each class B share carries ten votes against one for class A 3.

Problems and legal

A Brazilian subsidiary reported in 2018 that it may have broken local procurement rules and later signed leniency agreements with Brazilian authorities, paying about BRL 8.6 million 3. In February 2026 the competition agency SG/CADE recommended no fines, and the case is pending with CADE's Tribunal 3.

The umbrella, in words

The company sells its software under the names Strategy One, Strategy Mosaic and Auto, and issues five preferred stocks, STRF, STRC, STRK, STRD and STRE 6. The first four list on Nasdaq and STRE on the Luxembourg exchange 1.

The subsidiaries exhibit lists them as of 19 February 2026, among them MacroStrategy LLC and Macro1 LLC in Delaware, and MicroStrategy units in the United Kingdom, Germany, France, Japan, India, Brazil and other countries 7. It does not say which are listed 7.

Its treasury reserve assets are spare cash and short-term investments plus bitcoin, and its filings name no equity stake in another company 3. It leases about 190,000 square feet in Northern Virginia for its headquarters, a lease that expires in December 2030 6.

Control rests with Saylor's class B shares, which carry 32.8 percent of the votes 3. The 10-Q also mentions near-term payments for a new corporate aircraft 3.

Kang leaves on 5 November 2026 and advises the company through 31 December 2026 2. From 1 January 2027 Le is to be primarily responsible for the financial management of the bitcoin strategy, and Virasteh for the software operations, finances and budget 2.

Daily dividends on STRF, STRK and STRD take effect on 1 January 2027, and the STRC November daily dividends are payable in place of the semi-monthly dividend due 15 November 4. The company says the change leaves dividend rates and total obligations unchanged 4.

The board authorized up to $3.0 billion of repurchases of digital credit securities, with about $956.7 million left on 25 October, and $1.0 billion for common stock, none used 1.

A bitcoin monetization program lets the company sell bitcoin to fund the dollar reserve up to $1.25 billion, to pay dividends and interest and to fund repurchases 1. It has sold about $431.8 million of bitcoin this year 1.

Chief executive Phong Le said on the earnings call that "the primary way to acquire Bitcoin is by issuing digital credit" 8. The company says it has set no fixed amount of bitcoin to reach 3.

Management does not intend to recommend a change from the 12.00 percent STRC rate until STRC shows sustained trading near its $100 stated amount 3.

Holders of the 2028 convertible notes can require repurchase for cash from 15 September 2027 3. Full support for on-premises software licenses ends on 31 December 2026 6.

Strategy says it believes it has no positive accumulated earnings and profits for U.S. tax purposes and expects its preferred distributions to be treated as non-taxable return of capital for ten years or more 1. The Brazil case awaits the CADE Tribunal 3.