MicroStrategy Targets September Recovery for Struggling Preferred Stock

MicroStrategy's Strategy is aiming to recover its STRC preferred stock by September after an $8.22 billion loss in the second quarter, which was largely due to a decline in Bitcoin's price.

The company reported that its digital assets fell by $8.32 billion as Bitcoin's value dropped by 40% at the end of June compared to last year's second quarter. Despite this decline, MicroStrategy continued to purchase BTC, increasing its holdings by 11% to 846,000 units during the quarter.

However, the company was forced to sell some of its coins to meet preferred-stock obligations, reducing its holdings to 843,775 BTC and causing a decrease in Bitcoin per share. The sales were relatively small compared to MicroStrategy's acquisitions, which exceeded disposals by over 48 times during the first seven months of this year.

The STRC preferred stock has become an essential financing tool for MicroStrategy, allowing it to raise capital to buy more BTC. However, its stated value nearly doubled during the second quarter, rising from $5.3 billion at the end of March to $10.5 billion by June 30. The company's investor base also broadened, with institutional holdings increasing to $3.1 billion and retail investors holding 71% of the outstanding stock.

MicroStrategy is targeting September 8 as an informal benchmark for returning STRC to par, based on the 70 trading days it took for the security to climb from its $90 offering price to $100 after its July 2025 launch. The company believes that if it can achieve this, it will be able to resume issuing preferred stock at terms that support its longer-term Bitcoin strategy.

CEO Phong Le said that MicroStrategy wants to double Bitcoin per share in seven years through digital credit and plans to issue STRC and other preferred securities to fund this goal. The company aims to retain part of the proceeds in its dollar reserve and use the remainder to buy BTC without producing immediate dilution.