MicroStrategy has bought another 1,587 Bitcoin for $100 million, funding the acquisition by selling $209 million in common stock. The extra proceeds — more than double the bitcoin price tag — were funneled into the company's $1.1 billion cash reserve, which covers dividend payouts and debt obligations.
Funding mechanics
The company shifted away from high-yield preferred stock for this purchase, tapping common stock instead. MicroStrategy has a $21 billion common-stock program at its disposal. The move comes as its leverage-driven model faces mounting pressure: MSTR shares trade at roughly 0.8 times the net value of its Bitcoin holdings.
Balance sheet math
MicroStrategy now holds 846,842 Bitcoin, with a blended cost basis of $75,656 per coin. Bitcoin's current price sits below that average, leaving the position in unrealized loss territory. That gap strains a funding model that relies on the premium of stock over asset value.
First Bitcoin sale since 2022
In late May, the company sold 32 Bitcoin to cover a dividend payment — its first sale of the cryptocurrency since 2022. That sale was small relative to the total pile, but it signaled that MicroStrategy is willing to dip into its Bitcoin stash when cash flow tightens.
Preferred shares and dividend costs
MicroStrategy still carries preferred shares with coupons as high as 11.5%. The company's STRC dividend payouts have shifted from monthly to semi-monthly, adding to the fixed-cost burden. With Bitcoin prices below its average cost, the cash reserve becomes a critical buffer.
Next up: MicroStrategy's July dividend payment. Expect it to tap that cash reserve rather than sell more Bitcoin, at least for now.
