Strategy raises $335.5M, adds $300M cash, buys 520 BTC

Strategy, formerly MicroStrategy, sold about 2.71 million common shares between June 15 and June 21 and raised $335.5 million. The company deposited $300 million into its U.S. dollar reserve and allocated $34.9 million to purchase 520 Bitcoin to provide liquidity support for its STRC perpetual preferred securities.

The common-stock sales were executed through Strategy’s at-the-market program. The company did not issue additional STRC preferred shares during the week. The preferred security had fallen to a record intraday low of $82.50, below its $100 stated value, which limited Strategy’s ability to raise cash by selling STRC without increasing future dividend obligations.

After the transaction, Strategy’s dollar reserve reached $1.4 billion. The company’s diluted share count rose to about 388.6 million from 386.1 million the prior week. Strategy’s internal BTC Yield metric, which measures Bitcoin holdings per diluted share, declined to 11.8% from 13% four weeks earlier, reflecting that most proceeds were placed in cash rather than converted into additional Bitcoin.

STRC carries about $10.5 billion in stated value outstanding and pays an annualized $11.50 dividend. Because dividends are calculated on the $100 stated value, issuing STRC while the security trades below $100 would add dividend obligations without generating commensurate cash, according to the company’s filings.

Market prices moved after the filing. STRC briefly traded above $91 following the reserve disclosure but later closed at $88.64. MSTR rose in early trading and finished the day down 2.7% at $109.52. Strategy’s chief executive, Phong Le, disclosed a $1 million purchase of STRC during the decline and said he intended to hold the position until it returned to $100 or longer.

The 520-Bitcoin purchase was smaller than the 1,587 BTC acquired the previous week. Analysts estimate Strategy has bought roughly 174,300 Bitcoin so far this year, with about 55% of those purchases financed through STRC issuance and the remainder funded by common-stock sales.

Strategy’s filings show remaining capacity under its programs: about $25.4 billion available under its MSTR issuance program and $17.5 billion under STRC. The company’s filings indicate it is unlikely to use significant STRC capacity while the preferred trades below its stated value, leaving common-stock issuance as the more immediate source of capital if MSTR trades at a suitable level.

Quinn Thompson, chief investment officer at Lekker Capital, called the decision to use common-stock issuance to raise cash “exactly what we’ve been advocating for — use MSTR issuance to raise cash to bolster the balance sheet.” He added the cash increase should help meet dividend and interest obligations across the company’s capital structure and reduce the likelihood of forced Bitcoin sales.

Samson Mow, a Bitcoin industry executive, described the discount-to-yield dynamic of STRC as a “self-repairing mechanism,” noting that the $11.50 annual dividend produces a higher effective yield when the security trades below $100 and may attract buyers seeking yield and potential capital gains.

STRC is a perpetual preferred with no maturity date and a $100 stated value. Strategy has historically issued STRC when it trades at or above $100 and used proceeds to buy Bitcoin or meet other corporate needs. The recent choice to place most equity proceeds into cash rather than into Bitcoin followed the preferred’s drop below par and the mechanics of dividend obligations on preferred shares.