Strategy to Sell Bitcoin for Dividends After $14.47B Operating Loss
Strategy reported a first-quarter net loss of $38.25 per share, driven by a $14.46 billion unrealized Bitcoin writedown on its 818,334-coin holding. Executive Chairman Michael Saylor said the company will sell Bitcoin to fund preferred-stock dividends, reversing its “never sell” policy.
1. First-Quarter Results
Strategy reported Q1 revenue of $124.3 million, up 11.9% year-on-year but slightly below consensus. Net loss per share was $38.25, driven by a $14.46 billion unrealized writedown that expanded the operating loss to $14.47 billion.
2. Bitcoin Sale Consideration
Executive Chairman Michael Saylor said the firm will likely sell some Bitcoin to fund preferred-stock dividend payments, marking a shift from its long-standing “never sell” stance. He indicated that sale volume will depend on Bitcoin’s price and equity market conditions.
3. Bitcoin Holdings and Capital Strategy
As of May 3, the company held 818,334 BTC, a 22% increase year-to-date, financed mainly through debt and equity offerings including $5.58 billion of preferred shares. CEO Phong Le noted that selling Bitcoin could generate tax benefits to strengthen the balance sheet.
4. Market Reaction
Shares fell 3.1% in aftermarket trading following the results, reflecting investor concern over the deeper-than-expected loss. Bitcoin traded at a three-month high near $81,130, up 0.8%, showing muted response to the sale proposals.