Strategy Inc Considers Bitcoin Sales After Q1 $14.46B Writedown
MSTR•Strategy Inc posted a Q1 net loss of $38.25 per share driven by a $14.46B unrealized Bitcoin writedown on its 818,334-BTC holdings. The company will consider selling Bitcoin to fund preferred-stock dividend payments, reversing its “never sell” stance.
1. Q1 Financial Results
Strategy Inc reported Q1 revenue of $124.3 million, up 11.9% year-over-year but below the $125.07 million consensus. Net loss widened to $38.25 per share and operating loss surged to $14.47 billion, driven by a steep unrealized writedown on its crypto holdings.
2. Bitcoin Holdings and Writedown
As of May 3, the firm held 818,334 Bitcoins, 22% growth year-to-date at an average cost of $75,537 per BTC. A $14.46 billion unrealized loss on these digital assets accounted for the bulk of the quarterly deficit.
3. Dividend Funding Strategy
Chairman Michael Saylor signaled plans to sell Bitcoin to fund preferred-stock dividend obligations, marking a departure from the prior no-sell policy. CEO Phong Le noted potential tax benefits on any sales, suggesting a tactical approach tied to market conditions.
4. Market Reaction and Outlook
Shares fell 3.1% in after-hours trading on investor concern over the deep losses. With $2.21 billion in cash and ongoing preferred share issuances, the company will gauge Bitcoin price levels and equity market appetite before executing any sales.
