Strategy Booked an $8.3 Billion Bitcoin Loss Last Quarter. Could Q3 Show a Gain?
Strategy absorbed a staggering paper loss last quarter as Bitcoin slumped, but the cryptocurrency then staged a powerful rally that could flip the script entirely. Whether Q3 delivers a blockbuster reversal depends on one number investors are watching closely.
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Strategy Inc. (NASDAQ: MSTR | MSTR Price Prediction) experienced an $8.3 billion paper loss on its Bitcoin (CRYPTO: BTC) holdings in the second quarter, largely due to a drop in the cryptocurrency’s price. The company is expected to announce its Q3 earnings on October 29, 2026, though it has not yet been officially confirmed. The big question now is whether Strategy can turn that significant loss into a third-quarter profit.
Strategy Took an $8.32 Billion Hit in Q2, Then Bitcoin Rallied 42.8%
In its second-quarter report released on July 30, Strategy reported a net loss of $8.22 billion. A whopping $8.32 billion in unrealized Bitcoin losses drove that result, reflecting a decline in value that hit overall earnings. The company’s earnings per share (EPS) fell to -$24.45, missing expectations of $3.07, while revenue was $122.4 million.
These losses stem from fair value accounting, which requires companies to adjust asset values to reflect current market prices at the end of each quarter. Bitcoin closed on June 30 at $58,524 but climbed to $83,556 by September 30, marking a 42.8% increase during the quarter.
Strategy has continued to acquire Bitcoin, as its October 19 filing showed it purchased 267 BTC, valued at around $22.1 million, between October 12 and 18 at an average price of $82,900. This brings its total Bitcoin holdings to 848,517 BTC, which were purchased at a total cost of $64.02 billion, averaging $75,446 per coin.
As of October 23, MSTR shares were priced at $146, down 10% over the month but up 6.7% over the past week.
Wall Street’s Q3 Estimates Point Back to a Profit
Analysts are hopeful for a return to profitability in Q3, with consensus estimates projecting earnings of $17.98 per share, compared to $8.42 during the same period last year.
| Metric | Consensus | Year-Ago Actual | YoY Change |
|---|---|---|---|
| Q3 2026 EPS | $17.98 | $8.42 | +113.5% |
| Q3 2026 Revenue | $129.4 million | $128.7 million | +0.5% |
| FY 2026 EPS | -$19.12 | -$15.23 | Larger loss |
| FY 2026 Revenue | $501.7 million | $477.2 million | +5.1% |
Analysts’ EPS estimates for Q3 vary widely, ranging from -$0.99 to $52.82, reflecting different assumptions about Bitcoin’s quarter-end price.
Strategy’s Q3 Report Could Cover STRC Buybacks, Daily Dividends and Saylor’s Post
The potential unrealized gain from Bitcoin will be a key focus. With Bitcoin closing at $83,556 on September 30, prices were above Strategy’s average acquisition cost of $75,446, suggesting the company may report Q3 gains. By the end of Q2, the market value of their Bitcoin holdings was $49.7 billion, compared to a $63.9 billion cost basis.
Another key topic is the company’s preferred stock, STRC. This type of stock takes priority over common shares for dividends. The recent filing reported $193.1 million in STRC buybacks and an increased buyback authorization of $3 billion, with $1.16 billion remaining. In July, CEO Phong Le noted that buying STRC shares below par would reduce future dividend obligations.
Shareholders will also vote on October 28 on paying STRC dividends daily rather than twice a month, at the current annual rate of 12%. If approved, these daily dividends could start on November 1, allowing stockholders to earn dividends for each day they own shares without worrying about specific record dates. This change could help stabilize the price fluctuations that STRC typically experiences around ex-dividend dates.
Michael Saylor stirred interest on October 23 with a post stating, “Just resolving a few Bitcoin matters behind closed doors.” Investors will likely seek clarification on this comment, as well as updates on other revenue streams, such as subscription revenue, which rose 54% in Q2 to $62.9 million. Additionally, concerns are growing regarding Strategy’s potential removal from MSCI indexes.
Could Strategy’s Q3 Earnings Reflect a Bitcoin Gain?
Yes, Strategy could report a substantial unrealized gain for Q3, given Bitcoin’s rising value, which ended the quarter 42.8% higher than where it started. However, Bitcoin’s price has dipped since September 30, trading just above $80,000, marking a 3.9% decline over the past month.
This recent decrease affects only Q4, as Q3 ended on September 30. If Bitcoin remains below its September 30 close of $83,556 through December 31, Strategy could lose some of its Q3 gains in its next quarterly report.
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Sam Daodu is a crypto analyst and the editor of 24/7 Wall St.'s Crypto Desk, where he covers Bitcoin, XRP, Ethereum, Solana and the altcoins investors search for most. His work focuses on price levels, spot ETF flows, on-chain data and the regulatory decisions that move crypto markets, written so a first-time buyer and a seasoned trader can both use it.
Sam has written about crypto professionally since 2019 and has published more than 2,000 articles. Before joining 24/7 Wall St., he wrote for crypto media outlets and Web3 companies and ghostwrote for crypto founders and token launches. His analysis is syndicated on Yahoo Finance, MSN and AOL and has been cited by other crypto news sites. He also founded MacLabs Marketing, a content and personal branding agency for crypto founders and executives.
When he isn't reading charts, Sam is usually at the gym or watching One Piece, a series he maintains has better tokenomics than most altcoins.
