Strategy Q2 Earnings Live
Speakers
Michael Saylor
— Executive Chairman, MicroStrategy
Andrew Kang
— Founder and CEO of RoboStrategy
Fong Lee
— Chief Executive Officer, MicroStrategy Incorporated
Summary
Strategy reported Q2 2026 earnings with a net loss driven by Bitcoin mark-to-market, while Bitcoin holdings grew to ~846,000 BTC. Management emphasized their shift to active capital management, building a USD reserve, and repurchasing convertible debt. Michael Saylor detailed the investment case for Bitcoin, MSTR equity, and the company's digital credit instruments (STRC, STRF, STRD), highlighting their high yields, strong collateralization, and significant market undervaluation.
- Strategy holds 846k Bitcoin, the largest institutional holder.
- Q2 saw a $8.3B non-cash loss due to Bitcoin price decline, but quarter-to-date recovery of $5.2B.
- The company raised $17B year-to-date via equity and digital credit, with 44% from stretch (STRC).
- Stretch (STRC) traded below par at $89.50; management outlined pillars to return it to par including USD reserve strengthening, Bitcoin monetization, and buybacks.
- Michael Saylor views Bitcoin as digital capital trading near the 200-week MA, with banking adoption accelerating and dominance growing.
- He argues MSTR is designed to outperform Bitcoin over four-year periods and the digital credit business is undervalued.
- STRC, STRF, and STRD are presented as attractive credit instruments with high effective yields, large spread premiums, and robust collateral coverage.
Ideas
Bitcoin is digital capital near cycle low.
Bitcoin is the dominant digital capital network with growing dominance, increasing banking adoption, and sentiment near cycle lows. It is trading at a very slight premium to its 200-week moving average, historically a solid entry point. Headwinds from AI capital expansion, trade tensions, and Fed policy are expected to ease or turn into tailwinds, supporting long-term appreciation.
STRC yields highest among credit instruments.
STRC (Stretch) is the flagship digital credit product offering a 13.6% effective yield and 21.6% tax-equivalent yield, the highest among major credit classes. It is the number one holding in the three largest preferred credit ETFs, reflecting institutional demand. The company is committed to using its $1 billion buyback and other measures to return it to par, making it an attractive short-duration credit instrument with limited downside.
STRF senior preferred with high spread premium.
STRF senior preferred has a BTC overcollateralization of 12.9x, with a floor rate requiring Bitcoin to fall >21% per year to be undercollateralized. Even with modest Bitcoin appreciation (12.5% annually), it would be investment grade. It offers a massive spread premium over theoretical credit spreads and is attractively priced for long-term credit investors who trust the company.
STRD high-yield preferred for long-duration investors.
STRD is a high-yield preferred with an effective yield around 16% and a spread premium of 1,048 basis points above theoretical credit spreads. Even under skeptical Bitcoin return assumptions, its risk-adjusted return is compelling for long-duration credit investors who believe in the company's plan.
MSTR designed to outperform Bitcoin long-term.
MSTR equity is built to outperform Bitcoin over the long term, with a 100% success rate over four-year holding periods. The digital credit business is dramatically undervalued by the market, which implies only a $2 billion premium to net reserves despite potential for billions in annual net income from credit issuance. Wide moats from capital, technology, brand, and network effects support future valuation expansion.
