After $8.2B loss forced Bitcoin sales, Michael Saylor gives Strategy to September to repair broken dividend engine
Michael Saylor’s Strategy (previously MicroStrategy) is concentrating on a September restoration for its STRC preferred stock as the corporate seeks to revive the financing channel behind its purpose of doubling Bitcoin per MSTR share inside seven years.
The plan follows a second quarter that demonstrated Strategy’s rising publicity to Bitcoin’s worth swings.
The firm reported an $8.22 billion second-quarter loss after incomes $10.02 billion a 12 months earlier. Almost all of the reversal got here from an $8.32 billion loss on its digital belongings as Bitcoin ended June about 40% beneath its stage on the finish of final 12 months’s second quarter.
Strategy continued shopping for by the downturn. Its holdings elevated 11% through the quarter to 846,000 BTC, whereas Bitcoin per diluted share rose 5% to 210,824 satoshis.
The firm subsequently decreased its holdings to 843,775 BTC after promoting chosen cash to meet preferred-stock obligations. Bitcoin per share additionally declined to 203,683 satoshis by July 26.
Those gross sales stay small in contrast with Strategy’s acquisitions. The firm purchased 174,895 BTC and sold 3,620 BTC during the first seven months of 2026, that means purchases exceeded disposals by greater than 48 instances.
STRC turns into central as institutional demand grows
The transactions however spotlight how STRC has changed Strategy’s model. The most popular inventory has given the corporate one other manner to finance Bitcoin purchases, however it has additionally created a rising money burden that have to be managed when markets weaken.
STRC’s stated value practically doubled through the second quarter, rising from about $5.3 billion on the finish of March to $10.5 billion by June 30.
Strategy raised $7.53 billion by the variable-rate perpetual most popular inventory through the first seven months of the 12 months, making it one of many firm’s largest sources of recent capital.
Its investor base additionally broadened. Institutional holdings practically tripled to $3.1 billion between March 17 and July 1, rising their share of STRC to 29% from 22%.
Retail buyers remained dominant, holding $7.4 billion, or 71%, of the excellent inventory. The common retail place elevated to $48,000 from $44,000, whereas the typical institutional holding greater than doubled to $3.5 million.
Saylor mentioned:
“As of the first of July, the institutional holdings had grown from $1.1 billion to $3.1 billion.”
He argued that the shift ought to enhance the safety’s stability and assist Strategy appeal to buyers past the crypto market.
Strategy initially sees STRC competing with non-public credit score, financial institution most popular shares and high-yield bonds, with investment-grade and mortgage-backed securities representing longer-term markets.
Strategy makes use of September as its restoration benchmark
STRC’s efficient yield stood at 13.6% in late July, reflecting its 12% dividend fee and discount to its $100 stated value. That low cost made the product extra engaging to earnings buyers, however it additionally restricted Strategy’s capacity to problem further shares effectively.
The shares fell to $74.57 on May 28 earlier than recovering to about $89. Selling extra STRC at that stage would elevate much less money than the $100 senior declare created towards Strategy, weakening its usefulness as a Bitcoin financing device.
Management attributed a part of STRC’s decline to its determination to direct an excessive amount of capital towards Bitcoin whereas permitting the money reserve supporting its most popular securities to shrink.
Strategy’s designated greenback reserve fell to $871 million in late May, masking solely about six months of most popular dividends and debt curiosity. The firm has since rebuilt it to $3.75 billion, extending estimated protection to 2.1 years.
Chief Executive Phong Le mentioned the expertise forced Strategy to rethink the way it balances Bitcoin purchases with the liquidity wanted to help STRC.
Strategy plans to preserve STRC’s dividend fee at 12% after concluding that additional will increase have been unlikely to restore the value. Its restoration plan now depends on the bigger greenback reserve and open-market repurchases.
The firm licensed $1 billion of preferred-stock buybacks and spent $25 million acquiring STRC shares. It has $975 million remaining below this system.
Those measures have additionally given Strategy a timetable towards which buyers can decide the repair effort.
The firm is monitoring September 8 as a casual benchmark for returning STRC to par, primarily based on the 70 buying and selling days the safety required to climb from its $90 providing worth to $100 after its July 2025 launch. Applying the identical interval from the May 28 decline produces the September date.
Saylor mentioned:
“We’re preserving observe of that date, and we’re preserving observe of our progress. If we did it in 70 days after the IPO, then it’s affordable to goal 70 days after it fell off of our buying and selling vary.”
The comparability doesn’t assure one other 70-day restoration. STRC’s initial rise occurred below completely different market situations, and Strategy can’t compel buyers to worth the inventory at $100.
The scale of the present low cost additionally means that the repair could require extra intervention.
Saylor positioned STRC’s market capitalization at $9.2 billion towards $10.5 billion of acknowledged worth, leaving a niche of about $1.2 billion.
While Strategy wouldn’t want to buy the complete distinction if stronger demand lifts the shares, the remaining authorization is smaller than the quoted dislocation.
Still, Saylor insisted that the agency has “the means to return STRC to par,” citing its $58.5 billion Bitcoin reserve.
This means that help past the present authorization might require additional Bitcoin gross sales, new securities issuance, or capital that may in any other case fund accumulation.
STRC restoration underpins Strategy’s 2033 goal
Returning STRC to par would permit Strategy to resume issuing the popular inventory at phrases that help its longer-term Bitcoin strategy.
Le mentioned:
“Our general goal is to double Bitcoin per share in seven years by digital credit score.”
The goal implies development of roughly 10% yearly by 2033 within the quantity of Bitcoin represented by each diluted MSTR share.
To obtain this, the corporate plans to problem STRC and different most popular securities, retain a part of the proceeds in its greenback reserve, and use the rest to purchase Bitcoin with out producing the identical instant dilution as an MSTR sale.
At the identical time, Strategy needs annual digital-credit gross sales to equal between 10% and 20% of its Bitcoin reserve. Based on the roughly $55 billion portfolio cited in its outcomes, that would quantity to between $5.5 billion and $11 billion of issuance every year at present values.
Le mentioned:
“We need digital credit score to work as a result of we’re ready to promote digital credit score to purchase Bitcoin. That generates amplification to the corporate.”
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