Strategy reported operating income of $20.91 billion for the third quarter of 2026, its highest on record, with most of the result coming from an unrealized gain on its Bitcoin holdings. Net income was $19.53 billion, or $44.75 per diluted share, compared with $2.79 billion a year earlier.
The company marks its Bitcoin holdings to market each quarter, so price movements affect its reported earnings. Strategy held 848,517 BTC, valued at $68.9 billion on October 23, when Bitcoin was trading at $81,200. The company’s average purchase cost was $75,446 per Bitcoin.
Despite the increase in earnings, revenue fell 3% year over year to $125.4 million, below analyst estimates of $127.2 million. Gross profit was $89.6 million, representing a 71% margin, compared with 70% a year earlier. At the end of September, Strategy had $2.50 billion in cash and equivalents and $3.40 billion in short-term investments.
The company’s Bitcoin yield, which management uses to track Bitcoin held per share, was negative 3.7% year to date. Strategy also reported a $2.03 billion decline in the dollar value of its Bitcoin position over that period. It said it had sold about $431.8 million in Bitcoin this year to help fund preferred dividends and share repurchases.
Strategy raised $21.23 billion in capital during 2026, including $5.41 billion in net proceeds from its at-the-market program in the third quarter. It repurchased 20,980,508 STRC preferred shares for $2.04 billion, at an average price of $97.39. The company said it plans to continue buying STRC while it trades below its $100 stated amount; approximately $956.7 million remains available under the authorization.
Strategy’s dollar reserves totaled $5.07 billion, comprising a $4.83 billion USD Reserve and $242.4 million in USD Cash. The company said the reserves cover 3.4 years of dividend and interest obligations. Its board maintained STRC’s dividend rate at 12% to support trading near the stated amount.
Shareholders approved a change to daily dividends on October 28. STRC is scheduled to begin daily payments on November 1, followed by STRF, STRK and STRD on January 1, 2027. The company said STRC had reached $99.99, but had not confirmed a restart of share issuance.
Chief Financial Officer Andrew Kang announced his departure in the same release as the results. Strategy said it expects preferred distributions to qualify as a non-taxable return of capital for ten years or more, citing its expectation that it will not have positive accumulated earnings and profits. The company advised shareholders to consult their own tax advisers.
Sources: Bitcoin Magazine.