MicroStrategy plans to fund future Bitcoin accumulation primarily through perpetual preferred stock, marking a shift away from common stock issuance.
CEO Phong Le stated the company will transition from equity capital to preferred capital to mitigate share price volatility. This strategy aims to reduce dilution for existing shareholders by utilizing variable-rate perpetual preferred stock as a primary funding instrument.
The pivot follows significant year-to-date declines in MicroStrategy's stock price amid a slump in Bitcoin's value. The company raised $370 million through common stock sales to fund its three most recent Bitcoin purchases. Preferred shares accounted for only $7 million of that raised capital.