UPDATED: STRATEGY SPENT $193.1 MILLION BUYING BACK ITS OWN PREFERRED — AND $22.1 MILLION ON BITCOIN — USD CASH FELL FROM $640.5 MILLION TO $447.3 MILLION IN A WEEK
Strategy’s 8-K for October 12 to 18 landed at 8:00 AM ET on Monday, October 19. It bought 267 bitcoin for $22.1 million, about $82,900 each, and now holds 848,517. Stock paid for it: 140,872 MSTR shares sold for $22.0 million, plus $0.1 million of cash. The bigger check went somewhere else. Strategy bought back 1,938,780 shares of STRC, its variable-rate preferred, for $193.1 million, about $99.60 a share, and its board raised the buyback limit from $2.0 billion to $3.0 billion. It sold no preferred.
That buyback came out of USD Cash, which fell from $640.5 million on October 11 to $447.3 million on October 18. There’s $1.16 billion of buyback room left, $712.7 million more than that cash. The bigger pile, the $4.83 billion USD Reserve, is set aside for dividends and interest. It paid $45.5 million of preferred dividends this week.
UPDATE: Strategy has sold bitcoin before to raise dollars. Its June 1 8-K shows 32 bitcoin sold May 26 to 31 for $2.5 million, about $77,135 each, to pay preferred dividends. Its July 6 8-K shows 3,588 more sold June 29 to July 5 for $216.0 million, for dividends and to refill the USD Reserve. On its July 30 earnings call, Strategy named buybacks as one of the reasons it may sell bitcoin.
For people who own the common stock, the buyback was close to a wash. $193.1 million of cash went out, and $193.9 million of preferred, counted at $100 a share, went away. Buying under $100 saved $0.8 million. The dividends were the real cost. They pushed what Strategy owes ahead of common, after cash, up about $45 million to $49 million. Bitcoin per share, by our count, barely moved: 0.00200950 to 0.00200947.
Our first pass with this filing came to about 21.5% at $82,286. UPDATE, 9:31 AM ET: CEBE Tracker has caught up. As of October 18, at $82,020 bitcoin, Strategy’s debt and preferred, minus cash, equal 21.62% of its bitcoin, up from 21.13% on October 11 at $83,691. Most of that is bitcoin’s lower price. At $82,020, the October 11 numbers come to about 21.56%, so this week’s filing added about 0.06 points. CEBE puts each share’s bitcoin, after everything owed ahead of it, at 157,500 sats. At the time of this writing, bitcoin was $82,434.