What’s actually slowing this PC down?
Pick the symptom - the matching free tool is one click away.
iTechGuides is reader-supported. When you buy through links on our site, we may earn an affiliate commission. As an Amazon Associate I earn from qualifying purchases. Learn more
Strategy says it currently funds most bitcoin purchases with proceeds from at-the-market (ATM) sales of Class A common stock and preferred stock. It has also used convertible notes, senior secured notes, a bitcoin-secured loan and, historically, operating cash flow. The shareholder effect depends on more than the bitcoin headline: new common shares reduce each existing holder’s percentage ownership, preferred securities add senior claims and dividends, and convertible instruments can create common shares later.
The useful test is bitcoin exposure per diluted share after interest, dividends, fees, taxes and other claims—not whether the company’s total bitcoin balance increased. Strategy presents accretion as management’s objective, not as an independently proven result.
What funds Strategy’s bitcoin buying
Strategy’s 2025 Form 10-K says its current approach emphasizes Class A common stock and preferred-stock ATM proceeds. An ATM program lets the company sell securities into the market over time rather than through one fixed-price offering. The same filing says Strategy previously used convertible-note offerings, senior secured notes and a bitcoin-secured loan to acquire bitcoin, and may borrow again. Operating cash flow has also been used historically. See the company’s 2025 Form 10-K.
Recommended Free Tools
Class A common-stock ATM sales
When Strategy sells newly issued Class A shares, investors pay cash to the company and the total common-share count rises. Existing holders still own the same number of shares unless they participate, but those shares represent a smaller percentage of the company. The cash can be deployed to buy bitcoin, meet corporate obligations or support other capital needs described in the offering documents.
#1 Best Overall
- BITCOIN EXCLUSIVE, PHONE VERIFICATION: Bitkey is designed from the ground up exclusively for bitcoin — a dedicated hardware wallet for secure bitcoin storage. Approve transactions with a tap using your phone and NFC. No device screen is required.
- SELF-CUSTODY, NO EXCHANGE OR CUSTODIAN REQUIRED: You hold two of the three keys in the Bitkey system – one on your phone and one on your Bitkey device. The third is stored on Bitkey’s server and cannot move your bitcoin on its own.
- NO SEED PHRASE: Set up and use Bitkey without creating or storing a seed phrase.
- 2-of-3 MULTISIG: Three keys are stored separately across your phone, Bitkey device, and Bitkey’s server. Any two keys are required to move your bitcoin.
- BUILT-IN RECOVERY: Encrypted backup and recovery tools can help you regain access if you lose your phone or Bitkey device. You can also designate a Recovery Contact.
Preferred-stock ATM programs
Preferred securities raise capital without necessarily creating immediate common shares. They do, however, add dividend obligations and claims that rank ahead of common equity. Strategy’s filings describe five series—STRF, STRC, STRE, STRK and STRD—with different intended investor profiles:
| Series | Company-described emphasis | What a common holder should watch |
|---|---|---|
| STRF | Income and lower risk tolerance | Preferred dividends and senior claims ahead of common stock |
| STRC | Shorter duration | Dividend cost, redemption or repurchase activity and seniority |
| STRE | Euro-denominated income | Dividend obligation plus currency and senior-claim effects |
| STRK | Yield with potential price appreciation through a conversion feature | Possible future common-share dilution if conversion occurs |
| STRD | Higher yield | Higher financing cost and claims ahead of common stock |
These are Strategy’s descriptions of intended investor preferences, not independent credit ratings or guarantees. The 10-K explains the series and their terms; it does not establish that any series is safer for common shareholders.
Convertible and secured debt
Convertible notes combine a debt obligation with a possible equity outcome. Until repayment or conversion, the company owes principal and interest. If holders convert under the applicable terms, the resulting shares can increase the diluted share count. Senior secured notes and a bitcoin-secured loan add repayment obligations and collateral claims. More debt can preserve common ownership percentage in the short term, but it increases fixed cash costs, leverage and the consequences of a bitcoin-price decline.
Strategy’s annual report says it evaluates the all-in cost of preferred dividends and debt, issuance fees, execution costs and expected per-share effects when considering a capital transaction. That is a management framework, not a promise that a transaction will be accretive.
Rank #2
- Unparalleled Security: Protect your assets NDA-free EAL 6+ Secure Element, offering robust defense and complete transparency
- Simple & Secure Interface: Manage your digital assets easily with a clear OLED screen for secure on-device confirmations
- Supports 1000s of Coins & Tokens: Securely handle thousands of assets, including Bitcoin, Ethereum, and more, all in one wallet
- Effortless Asset Management: Monitor and transact seamlessly with Trezor Suite, our intuitive desktop and mobile app
- Enhanced Backup Solution: Rest assured with Multi-share Backup, eliminating single points of failure for secure cold wallet recovery
What “dilution” means in this case
Shareholders should separate three effects that are often collapsed into one word.
1. Direct common-share dilution
A new Class A share increases the denominator used in ownership-percentage and per-share calculations. An investor who owns 1,000 shares before an issuance owns 1,000 afterward, but those shares represent less of the company unless the investor buys additional stock. This is the most immediate form of dilution from an ATM sale.
2. Potential dilution from conversion
A convertible note or a convertible preferred security may not add shares today. Its conversion terms can nevertheless create shares later. Analysts therefore use an assumed diluted share count that includes securities considered potentially dilutive under the relevant accounting and market conditions. A repurchase of convertible debt can reduce that assumed count.
3. Economic subordination and financing cost
Preferred holders generally receive dividends and have claims ahead of common stock. Debt holders receive interest and repayment priority, and secured lenders have collateral rights. Even when no common shares are issued, those cash obligations and senior claims reduce the residual value available to common shareholders. This is economic dilution or subordination rather than an immediate change in the common-share count.
Rank #3
- Unparalleled Security: Protect your assets with EAL 6+ Secure Element, offering robust defense and complete transparency
- Simple & Secure Interface: Manage your digital assets easily with a clear OLED screen for secure on-device confirmations
- Supports 1000s of Coins & Tokens: Securely handle thousands of assets, including Bitcoin, Ethereum, and more, all in one wallet
- Effortless Asset Management: Monitor and transact seamlessly with Trezor Suite, our intuitive desktop and mobile app
- Enhanced Backup Solution: Multi-share Backup eliminates single points of failure for secure cold wallet recovery
What happened in the first half of 2026
Strategy reported buying 174,895 bitcoin and selling about 1,395 during the six months ended June 30, 2026. It said purchases were funded primarily with net proceeds from STRC and Class A common stock, together with STRK. Its Q2 2026 earnings release reported $17.06 billion raised year to date through ATM programs as of July 26, 2026, and $7.53 billion of STRC issuance year to date as of that same date. Those figures cover different reporting cutoffs from the six-month purchase data and should not be treated as one period-end total. The figures appear in the Q2 2026 Form 10-Q and Q2 2026 earnings release.
The share-count calculation
For that six-month period, Strategy said ATM issuance of about 58.5 million Class A shares raised approximately $8.24 billion. It also repurchased $1.50 billion aggregate principal amount of its 2029 Convertible Notes. The repurchase reduced the assumed diluted share count by about 2.2 million, partly offsetting the increase from the ATM issuance. After that offset, assumed diluted shares outstanding increased by approximately 56.4 million to approximately 401.3 million at June 30, 2026.
The calculation illustrates why looking only at shares sold can mislead. The relevant question is whether the bitcoin acquired with the proceeds increases bitcoin exposure per diluted share by enough to cover financing costs and other claims. Strategy’s Bitcoin Per Share statistics measure exposure to the company’s holdings; they do not guarantee that the stock will rise or that a shareholder will earn a positive return.
Free tools Windows power users keep installed
One-click scans. No signup required.
How Strategy says it decides when to issue common stock
In its July 31, 2025 earnings release, Strategy described an mNAV-based framework for common-stock ATM issuance. mNAV was defined as enterprise value divided by Bitcoin NAV. The company said:
Rank #4
- Dual-chip architecture for maximum protection: The next-gen, fully auditable TROPIC01 chip works alongside a certified EAL6+ Secure Element—completely NDA-free—to deliver radically transparent, industry-leading defense against physical attacks.
- Quantum-ready security: Get protection against future threats with the first-ever hardware wallet designed with quantum-ready architecture.
- See every detail with confidence: Our largest high-resolution color touchscreen makes it easy to navigate your assets, review transactions and manage your coins with clarity.
- Wireless freedom with encrypted Bluetooth control: Manage, buy, swap and stake securely using Trezor Suite on desktop or mobile. Qi2-compatible wireless charging keeps your Trezor powered up. No cables required—security meets convenience.
- Works seamlessly with Android, iOS and desktop: Connect wirelessly or via USB-C to your phone or computer. Manage your crypto anywhere with our companion Trezor Suite app.
- Below 2.5× mNAV, it would not issue common equity to buy bitcoin, except to pay debt interest and preferred dividends.
- Between 2.5× and 4.0× mNAV, it would issue opportunistically.
- Above 4.0× mNAV, it would issue actively.
This was a company-described framework dated July 31, 2025—not a binding covenant, a current independent valuation or a rule that guarantees accretion. Strategy explicitly reserved the right to review and change the thresholds at its sole discretion. The original release is available at Strategy’s July 31, 2025 results announcement.
How to judge whether a financing helps common shareholders
Use the following sequence for each offering or debt transaction.
- Identify the security issued. Determine whether it is common stock, a particular preferred series, a convertible note, senior secured debt or another instrument.
- Measure the immediate denominator change. Record new common shares issued and update basic and assumed diluted shares.
- Check future-share features. Read conversion ratios, settlement choices, caps, floors and other terms that could add shares.
- Calculate recurring cash costs. Include preferred dividends, debt interest, fees, required repayments and any reserve funding. A one-time issuance fee and an ongoing coupon affect per-share economics differently.
- Map priority claims. Note which securities rank ahead of common stock and whether assets, including bitcoin, secure borrowings.
- Compare bitcoin acquired with diluted shares. Divide the incremental bitcoin exposure by the post-transaction diluted share count, rather than comparing only total bitcoin held.
- Stress-test bitcoin prices. A sharp decline can reduce the value of holdings while interest, dividends and principal obligations remain. A rise can improve asset value, but it does not remove senior claims or guarantee a stock return.
- Check the reporting date. Use the filing date and measurement period for every balance, issuance and estimate; do not treat a period-end figure as live.
Latest dated position in the reviewed filings
Strategy’s October 5, 2026 Form 8-K reported 847,666 bitcoin held as of September 30, 2026, plus 334 bitcoin acquired from October 1 through October 4. It also disclosed an estimated $20.91 billion Q3 2026 gain on digital assets and an estimated $1.88 billion associated deferred tax expense. The filing said those tax estimates reflected reversal of a previously recognized deferred tax asset and release of an associated valuation allowance. These were preliminary estimates, not finalized or audited quarterly results. Read the filing at Strategy’s October 5, 2026 Form 8-K.
The same filing reported no ATM share sales and no bitcoin purchases between September 28 and September 30. Separately, it said USD Cash was used from September 28 through October 4 for STRC repurchases and bitcoin purchases. Those short-period transactions should not be conflated with the year-to-date ATM totals or with the September 30 period-end bitcoin balance.
Best Value
- Effortlessly build your crypto portfolio via the all in one Ledger Wallet app: buy, sell, send, receive, swap, stake and more across popular blockchains. 15,000+ coins & tokens in a single dashboard. Keep a close eye on the market. Compare service providers. Track performance. Get timely alerts. Build your portfolio with confidence.
- Enjoy Bluetooth connectivity, iOS access, and hours of battery use with this mobile-first, secure backup signer. Freedom you can depend on.
- Genuine Check: confirm your signer is authentic during setup with the Ledger Wallet app.
- Protect your signer: keep it in mint condition at all times with a bespoke Pod or Case to avoid scratches and everyday wear and tear.
As of July 26, 2026, Strategy had reported $1.06 billion in cumulative dividends paid on all preferred stock. That figure shows why preferred financing matters to common holders even when it does not immediately increase common shares.
Why bitcoin price volatility changes the picture
Bitcoin holdings are marked under the company’s applicable accounting model, so fair-value gains and losses can flow through net income. Strategy’s July 2026 release warned that earnings are highly sensitive to bitcoin’s market price. A large reported gain can therefore reflect market appreciation rather than cash generated by operations, while a price decline can pressure asset values without automatically reducing contractual interest, dividends or principal payments.
“We believe offering a range of securities, including equity and fixed income instruments, enables us to flexibly access a broad spectrum of investors, which in turn enables us to execute on our strategy of acquiring bitcoin in a manner we believe to be accretive to common stockholders on a per share basis.”
Special offer. See more information about Outbyte and uninstall instructions. Please review EULA and Privacy policy.
That sentence is Strategy’s stated belief in its 2025 Form 10-K, not an independent finding. In the Q2 2026 release, CEO Phong Le said the company strengthened its balance sheet while navigating a meaningful bitcoin-price decline and pointed to higher bitcoin holdings and Bitcoin Per Share, lower convertible debt and a larger USD Reserve. Those are management’s characterizations of the quarter.
Common analytical mistakes
- Calling every preferred issue “common dilution.” Preferred stock normally adds senior dividends and claims first; only a conversion feature creates potential common shares.
- Using total bitcoin as the sole success metric. Purchases financed with many new shares can leave each diluted share with less exposure.
- Ignoring repurchases and conversions. Convertible-note repurchases can reduce assumed dilution, as the 2029-note transaction did in the first half of 2026.
- Mixing reporting periods. July 26 year-to-date issuance, June 30 share counts and September 30 holdings answer different questions.
- Treating mNAV thresholds as permanent. The 2025 framework was discretionary and could be changed.
- Reading estimated gains as cash profit. The October 5 Q3 figures were preliminary estimates tied to bitcoin-price movements and deferred-tax accounting.
Bottom line for shareholders
Strategy’s funding model combines common and preferred ATM equity with a history of convertible and secured debt. Common ATM sales directly dilute ownership percentages; preferred issues impose dividends and seniority; convertibles can dilute later. The first half of 2026 demonstrates both sides of the strategy: substantial share issuance to fund bitcoin purchases and a partial reduction in assumed dilution from convertible-note repurchases. To assess a transaction, track bitcoin acquired per diluted share after all financing costs and senior claims, using the exact reporting dates. Management’s accretion objective is a claim to evaluate, not a guaranteed outcome.
Quick Recap
Product prices and availability are accurate as of the date/time indicated and are subject to change. Any price and availability information displayed on Amazon at the time of purchase will apply.
