Strategy Inc

Hello, everyone, and good evening. I'm CJ, Head of Investor Relations at Strategy. It's an honor to kick off Strategy's first quarter 2026 earnings webinar. I'll be your moderator today. We will start the call with a 16-minute presentation, starting with Andrew Kang, followed by Fong Lee, and then Michael Saylor. This will be followed by a 30-minute interactive Q&A session with four Wall Street equity analysts and four Bitcoin analysts. Before we proceed, I will read the Safe Harbor Statement. Some of the information we provide in the presentation regarding our future expectations, plans, and prospects may constitute forward-looking statements. Actual results may differ materially from these forward-looking statements due to various important factors, including fluctuations in the price of Bitcoin and the risk factors discussed under the caption Risk Factors. in Strategy's annual report on Form 10-K filed with the SEC on Feb 19th, 2026, and the risks described in other filings that Strategy may make with the SEC. We assume no obligation to update these forward-looking statements, which speak only as of today. With that, I will turn the call over to Andrew Prang, the CFO of Strategy.

Thank you, CJ.

First off, I'd like to officially welcome T.J. Jain to his new role as Strategy's Head of Industrial Relations. I also want to take a moment to thank Sharish Jodhia, our Corporate Treasurer, for helping establish and lead our IR function for the last 20 quarters. As our team grows, I know we will strive to continue to provide transparent and relevant information to all of our shareholders and stakeholders. So, welcome, T.J. Now, turning to the quarter's results. We are off to a very strong start in 2026. We now hold 818,334 Bitcoin, which is about 3.9% of all Bitcoin that will ever exist. That keeps Strategy in a clear leadership position as the largest corporate Bitcoin holder in the world. Our market cap is now $62 billion, and Stretch, SGRC, has grown to $8.5 billion outstanding. showing strong market fit and investor demand and filling a gap that has existed for investors seeking stable price and attractive yields, backed by Bitcoin. So far in 2026, we've raised about $11.7 billion of capital, giving us more flexibility to keep our Bitcoin position and creating long-term value for our shareholders. Turning to Q1 financial results. we reported an operating loss of $14.5 billion and a net loss of $12.8 billion. As you would expect, these results were primarily driven by the decline in Bitcoin's fair value during the quarter. And as these are largely non-cash market-driven impacts tied to Bitcoin's quarter end price, our underlying strategy remains unchanged. Raise capital responsibly, buy and hold Bitcoin over the long term, and grow Bitcoin per share for our shareholders. On slide eight here, Bitcoin per share increased from 181,030 sats per share in May 2025 to 213,371 sats per share in May 2026, which is roughly an 18% year-over-year increase. Year-to-date, we have delivered 9.4% BTC yield compared to 22.8% for the full year of 2025, showing acceleration year-to-date compared to the same point last year. We've also generated 63,410 BTC gain so far in 2026 compared with 101,873 BTC for all of 2025, having already achieved about 62% of last year's full BTC gain in just the first four months of the year. In dollar terms, that represents approximately $5 billion of BTC dollar gain year-to-date versus $8.9 billion for the full year of 2025. Since 2020, Bitcoin per share has grown to 213,371 FAS per share as of May 2026, which is nearly a 4x increase since the beginning, delivering positive BTC yield every year across multiple market environments. In 2025, we delivered 22.8% BTC yield, and so far in 26, we've already added another 9.4%. We remain focused on consistently increasing Bitcoin per share over time through our disciplined treasury operations and long-term conviction in Bitcoin. Here on slide 11, our track record remains constant, having acquired additional Bitcoin in every quarter since 2020 across 108 separate acquisitions. As of May 4th, we held over 818,000 Bitcoin for a total value of approximately $64 billion and a total acquisition cost of about $62 billion. Our average purchase price is approximately $76,000 per Bitcoin, and our holdings now represent, as I mentioned, 3.9% of all the Bitcoin that will ever exist. Turning here to the balance sheet, digital assets ended the quarter at $51.6 billion compared to 58.2%. $9 billion at year end. Having acquired 89,599 Bitcoin in Q1, the change reflects the lower price of Bitcoin at the end of the quarter versus at the end of last year. Cash and cash equivalents were $2.2 billion, which largely reflects our USD cash reserve. Regarding taxes, the change this quarter was driven by the quarter and the mark-to-market movement in Bitcoin. And as Bitcoin moved from an unrealized gain at the year end to an unrealized loss at the end of Q1, our deferred tax liability of $1.9 billion shifted to a deferred tax asset. A full valuation allowance against that tax asset brought the net balance sheet tax solution to zero, which also resulted in a non-cash tax benefit on the income statement, which partially offset the pre-tax loss for Q1. Long-term debt remained unchanged at $8.2 billion, while preferred equity increased to $9 billion, driven by strong stretch issuance in the quarter. Overall, the balance sheet remains highly liquid and extremely well capitalized. At the end of Q4, the market value of our Bitcoin was approximately $59 billion, which is based on a Bitcoin price of about $87,500. During Q1, we recognized that unrealized fair value loss of about $14.5 billion. And despite Bitcoin price volatility, we continue to execute having purchased an additional 89,599 Bitcoin in the quarter for approximately $7.3 billion at an average price of about $80,900. We ended the quarter with a digital asset value of $51.6 billion based on a Q1 ending Bitcoin price of about $67,800. In Q2 so far, we are illustrating an unrealized fair value gain of approximately $8.3 billion as of May 1st. We purchased an additional 56,235 Bitcoin quoted a day for approximately $4.1 billion at an average price of roughly $73,400 for that period. Those purchases benefiting from the increase in Bitcoin price adds approximately $300 million of positive fair value. And as of May 1st, our Bitcoin held a market value of approximately $64 billion based on a Bitcoin price of $78,350. In dollar Bitcoin reserves. implying an MNAV of 1.27, which has expanded since the beginning of the year. We have $13.5 billion of preferred equity, representing 34% amplification and net leverage of 9%, made up of the $8.2 billion of convertible debt. Strategy is building around Bitcoin as digital capital. We have approximately $58 billion of equity. You can see here large traditional banks operate with liabilities to asset ratios above 90%. Our ratio is a mere 9%. That gives us a very different foundation made up of a very large equity base, substantial Bitcoin reserves, and structurally lower balance sheet risk. We can issue Bitcoin-backed credit products to support investors with strong collateral and continue accumulating Bitcoin over the long term from a position of strength and durability. We have approximately $6 billion of net debt, which represents just 9.3% net leverage against our Bitcoin reserve, which is effectively a 10.8 times BTC rating. Our strategy is based on a disciplined balance sheet construction, modest leverage, strong collateral, and permanent capital to grow our Bitcoin over time. Our net leverage is lower than the average of the investment-grade S&P universe and lower than every major industry sector across most S&P 500 companies. At the current Bitcoin price, our reserve is valued at approximately $64 billion compared to $6 billion of net debt, which translates to the 10.8 times BTC rating. The stretch case on the right shows that even after a 91% Bitcoin price decline to roughly about $7,300 per Bitcoin, our Bitcoin reserve would still be sufficient to cover our net debt at a one times BTC rating. Our USD cash reserve has remained consistent at $2.25 billion. And while the years of coverage has shifted down with the growth of stretch this year, we believe the stable cash along with our Bitcoin reserves and ability to raise additional capital continues to provide us with the flexibility to continue supporting our dividends for the foreseeable future. On the next slide, the $64 billion of BTC reserves adds an additional 43 years of coverage. Another way to look at this, at today's reserve size, Bitcoin would need to grow by only 2.3% annually for the reserve growth to cover our current obligations. If Bitcoin grows at or faster than the break-even ARR here, the BTC reserve alone can support our dividends without requiring any additional capital. Before I turn it over to Thonker's remarks, I'd like to highlight the amendment to stretch that we have asked for your vote on. We are proposing to move stretch dividends from monthly to semi-monthly with payments twice per month on the 15th and the last day of the month while keeping the economics unchanged. Our goal is to make stretch work better for investors by reducing reinvestment lag, improving liquidity, dampening the impact of a single monthly record date, and helping stretch trade more efficiently around the target price. Today, Stretch pays out 12 times per year with one payment at month end. Under the proposed amendment, Stretch would pay 24 times a year with payments around the 15th and the last day of the month. Again, total dividend economics are unchanged, and payments would simply be about half the size and paid twice as often. Under the proposed change, there would be two record dates, one on the 15th and one at the end of the month, with the related payment dates made on the next scheduled record date. If the vote is approved, the first record date would be June 30th and the first payment date would be July 15th. The mechanics are pretty straightforward, same dividend economics, more frequent payments, and a clear transition timeline. We believe this change creates the highest frequency credit instrument in the world and makes a great product twice as better and we look forward to your support. With that, I will turn it over to Fong.