Strategic Shift in Capital Management
Strategy Inc. (Nasdaq: MSTR), led by Executive Chairman Michael Saylor, has signaled a potential shift in its financial strategy, identifying bitcoin sales as a viable mechanism to fund the repurchase of its Variable Rate Series A Perpetual Stretch Preferred Stock (STRC). This move is part of an effort to maintain the trading price of STRC near its $100 stated amount while ensuring liquidity and reducing volatility.
In a statement released on July 27, 2026, Saylor clarified that while the company maintains a robust USD reserve—now at a record $3.75 billion—this capital remains strictly earmarked for debt obligations and dividend payments. Consequently, future STRC buybacks will be financed through alternative channels, specifically the issuance of MSTR common stock or the strategic sale of bitcoin when market conditions render the repurchases economically advantageous.
The Economics of STRC Repurchases
The company’s focus on STRC is driven by the desire to reduce long-term dividend liabilities. During the week ending July 26, Strategy repurchased 288,930 STRC shares for approximately $25 million, at an average price of $86.52 per share. By retiring these shares at a discount to their $100 par value, the company effectively lowers its recurring dividend expenditure.
Phong Le, President and CEO of Strategy, noted that the firm intends to scale these purchases based on market price and liquidity. The company has approximately $975 million remaining under its current authorization for such buybacks, providing significant capacity for future operations.
Bitcoin Yield and Market Criticism
The strategy has drawn scrutiny from critics, including investor Peter Schiff, who argues that the company’s focus on stock-based financing is diluting the value for common shareholders. Schiff highlighted that Strategy’s ‘Bitcoin Yield’—a metric tracking the amount of bitcoin held per MSTR share—has declined significantly as the company issues more common shares without corresponding bitcoin acquisitions. According to Schiff, the yield dropped from 13.3% in late May to approximately 4.5% in late July.
Strategy’s own Q1 2026 filings acknowledged this potential outcome, noting that if the company increases its diluted share count at a faster rate than its bitcoin holdings, a decrease in Bitcoin Yield is inevitable. Investors are now looking toward the upcoming Q2 2026 earnings report, scheduled for July 30, for official data on the company’s holdings and the impact of these capital maneuvers.