- Strategy (formerly MicroStrategy) has lost about 40% of its market capitalization since founder Michael Saylor stopped selling bonds on Feb. 21, 2025.
- From Dec. 11, 2020, the company issued senior notes to raise cash and used the proceeds to buy Bitcoin; those offerings required cash interest and eventual principal repayment.
- On Jan. 31, 2025, Saylor shifted the company toward dividend-paying preferred shares to avoid principal repayment and to raise capital without immediate common-stock dilution.
- Preferred-share sales briefly lifted the common stock from about $350 to $457 by July, but MSTR has since fallen 64% from that high and 52% since Jan. 31, 2025.
- Investors later focused on the long-term cost of perpetual dividend obligations, prompting a reversal in market sentiment.
Strategy, led by founder Michael Saylor, stopped selling traditional bonds on Feb. 21, 2025 and began issuing dividend-paying preferred shares, a shift that coincides with a roughly 40% drop in the company’s market capitalization.
Since December 11, 2020, the company had issued senior notes that required cash interest payments and repayment of principal in cash or stock at or before maturity. The company used proceeds from those bond sales to buy bitcoin and continued issuing bonds through Feb. 21, 2025.
On Jan. 31, 2025, Saylor announced a move to preferred shares that pay dividends instead of repaying principal. Preferreds let the company raise capital without immediate dilution to common shareholders and without scheduling principal repayment; dividends are ongoing cash payments to preferred holders. The company said it would pay higher rates but allowed timing flexibility, noting the board could delay payments "if the board of directors ever sensed a crisis."
Initially, sales of preferreds helped lift the common stock price from about $350 on Jan. 31 to a 2025 high near $457 by July. Earlier, the common stock had risen sharply after the first bond offering—tripling from $29 to $100 within two months and ultimately rising about 1,000% by the final bond issuance. Since the July peak, however, MSTR has fallen about 64%, and it is down 52% since Jan. 31, 2025. A chart of MSTR since the last bond offering shows the decline (Source: TradingView).
Technical terms: senior notes are debt instruments that require regular interest payments and eventual repayment of principal; preferred shares are equity that usually pay dividends and typically do not require returning principal. At-the-market (ATM) sales are offerings of common stock sold gradually into the open market.
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