Strategy is pushing the boundaries of corporate finance with a novel proposal for its flagship funding instrument. The software company, formerly known as MicroStrategy, has submitted plans to the U.S. Securities and Exchange Commission to convert its STRC preferred stock into what would be the world’s first security paying dividends twice a month. This move to implement 24 annual payouts—on the 15th and the last day of each month—aims directly at calming the stock’s notorious volatility, particularly the typical price dips following ex-dividend dates.
The company’s relentless Bitcoin accumulation strategy is the driving force behind this financial engineering. Between April 13 and 19, Strategy deployed approximately $2.54 billion to purchase 34,164 Bitcoin, a massive acquisition financed primarily through its complex capital structure. The STRC instrument was central to this deal, funding about 86% of the purchase in an effort to limit dilution for common shareholders. This brings the firm’s total Bitcoin hoard to 815,061 tokens, a treasury valued at over $62 billion.
However, this aggressive strategy is not without significant cost and risk. The preferred shares used to fund these purchases carry a hefty 11.5% dividend yield, a substantial ongoing financial burden on the company’s cash flow. Market sentiment has soured, reflected in a shrinking premium to the net asset value (mNAV), which makes raising new equity capital less efficient. Investors are growing increasingly nervous about dilution and the sustainability of the model, concerns that have pressured the share price.
Should investors sell immediately? Or is it worth buying Strategy?
The stock closed Wednesday at €147.50, a gain of roughly 5% for the session but still trading about 25% below its 200-day moving average. This underscores the deep uncertainty that has shadowed Strategy since its peak near €392 in July 2025, despite the current price holding above the 50-day average.
A major test of the strategy’s viability arrives with the company’s first-quarter 2026 earnings report, scheduled for May 5. Analysts project revenue of around $127 million, a year-over-year increase of about 12%. Yet the top line is secondary to the balance sheet impact. Since adopting fair-value accounting in 2025, Bitcoin’s price swings now directly hit reported net income. For Q1 2026, analysts anticipate a significant loss per share of approximately $35.56, despite the multi-billion dollar crypto holdings on the books. A return to positive earnings per share is not forecast until the second quarter.
The upcoming report will be scrutinized for how management communicates these paper losses and whether the market interprets the proposed bi-monthly dividend for STRC as a stabilizing mechanism or merely another layer of financial complexity. The core challenge for Strategy remains proving that the long-term benefits of its monumental Bitcoin bet can outweigh the steep and immediate costs of financing it.
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