Strategy Posts Record Loss as Bitcoin Holdings Decline

Strategy, the digital asset-focused company, reported an $8.22 billion net loss for its second quarter. This loss is largely due to a markdown of $8.32 billion on its Bitcoin holdings.

The company held 843,775 BTC worth roughly $54.8 billion as of July 26, which is below its acquisition cost of $63.7 billion recorded in the same period. Strategy plans to continue selling some of its Bitcoin holdings to replenish cash reserves and fund preferred dividends.

The company's revenue grew 6.9% year-over-year to $122.4 million during the quarter, while its gross profit increased to $81.6 million. However, the gross margin narrowed to 66.6% from 68.8%. Strategy's cash and equivalents totaled $1.71 billion at quarter-end.

Strategy has been selling some of its Bitcoin holdings to fund preferred dividends and interest payments. The company sold about $218.4 million worth of BTC during the period, which is a change from its earlier practice of retaining every purchase.