MicroStrategy's Perpetual Preferred Stock Offering Sees Limited Demand, Could Yield 11.75%

MicroStrategy plans to sell 2.5 million shares of its new 10% perpetual preferred stock, which could yield around 11.75%. The offering follows two other preferred deals this year, totaling $2 billion in outstanding shares. Investor demand appears lackluster, with pricing expected late Thursday.

MicroStrategy Incorporated (Nasdaq: MSTR/STRK/STRF), the world’s first and largest Bitcoin Treasury Company, has announced the pricing of its initial public offering (IPO) of 11,764,700 shares of 10.00% Series A Perpetual Stride Preferred Stock (STRD Stock). The offering is priced at $85.00 per share, with the issuance and sale scheduled to settle on June 10, 2025, subject to customary closing conditions [1].

The estimated net proceeds to MicroStrategy from the offering are approximately $979.7 million, after deducting underwriting discounts and commissions, and estimated offering expenses. The company plans to use these funds for general corporate purposes, including the acquisition of bitcoin and for working capital [1].

Dividends on shares of the STRD Stock will be non-cumulative, payable quarterly in arrears at a rate of 10.00% per annum on the stated amount, subject to declaration by the board of directors. The redemption price for any STRD Stock to be redeemed will be a cash amount equal to the liquidation preference plus declared and unpaid regular dividends [1].

Barclays, Morgan Stanley, Moelis & Company, and TD Securities are acting as joint book-running managers for the offering. The offering is being made pursuant to an effective shelf registration statement on file with the Securities and Exchange Commission (SEC), and an electronic copy of the preliminary prospectus supplement is available on the SEC’s website [1].

This IPO follows two other preferred deals this year, totaling $2 billion in outstanding shares. Investor demand appears to be lukewarm, with pricing expected to be announced late Thursday. The offering is expected to be priced at $85.00 per share, with the net proceeds estimated at approximately $979.7 million [1].

MicroStrategy’s treasury strategy involves accumulating Bitcoin as a primary reserve asset, and the proceeds from this IPO will be used to further this strategy. The company’s combination of operational excellence, strategic Bitcoin reserve, and focus on technological innovation positions it as a leader in both the digital asset and enterprise analytics sectors [1].

References:
[1] https://www.strategy.com/press/strategy-announces-pricing-of-initial-public-offering-of-strd-stock_06-08-2025