Strategy remains its STRC preferred stock’s annual dividend by 12% for August 2026, although the Nasdaq-listed shares closing July over 10% below the $100 par value.
The company reported a 12% annual dividend rate for STRC in August. Michael Saylor launched the stock on August 1, underscoring its twice-monthly dividend payments as a move to earn profit.
On July 31, STRC closed at $89.46 below $0.25, providing a yield of roughly 13.4% based on its unchanged $12 annual dividend.
What Does The Policy Say?
Strategy expanded STRC’s annual dividend from 11.5% to 12% in July following the decline in June over $71.25 below its target price of $100.
Strategy updated its dividend policy on June 29, highlighting STRC payouts will be based on multiple factors such as market price, credit spreads, competing yields, Bitcoin fluctuation, cash reserves, and capital structure below $100 par value.
Maintaining the dividend at 12% helps restrict Strategy’s cash obligations to increase the demand. A 50-basis-point increase influenced the annual dividend costs of approximately $10.46 billion in outstanding STRC value.
Reacquisition support STRC’s price
Strategy increases its dividends to repurchasing STRC shares. Previously, it bought 289,000 shares of about $25 million at an average price of $86.52 or 13.5% below the $100 stated value.
Strategy held $975 million available under its $1 billion preferred share reacquisition program. Strategy aims to continue buying STRC at larger discounts and scale back purchases as the share price is $100.
Acquiring STRC below par lessens future dividend obligations and enables Strategy to retire $100 of stated value at a lower cost. In contrast, the reacquisition also uses funds to support dividends, debt payments, or Bitcoin acquisition.
Strategy funded roughly $25 million STRC reacquisition while developing its US dollar reserve and pausing Bitcoin acquisitions. The company earned much of the liquidity through MSTR common stock sales instead of delivering additional STRC shares.
Cash Reserve Backs STRC
Strategy announced a $3.75 billion US dollar reserve on July 26 to cover approximately 2.1 years of preferred dividends and debt interest.
Strategy’s cash reserve has become significant as preferred-stock obligations increase, with Q2 preferred dividend increasing to $400.7 million from $49.1 million a year earlier. Also, Strategy reported a $8.22 billion net loss due to unrealized Bitcoin losses.
Strategy sells Bitcoin to replenish reserves, funds dividends and interest payment, or back approved buybacks on July 26 approximately $218.4 million worth of Bitcoin in 2026. Strategy held 843,775 BTC valued at $54.77 billion, below its $63.69 million acquisition cost.
STRC Distribution Strategy
After the shareholder approval in June, STRC shifted from monthly to twice-monthly distributions, with payments linked to record dates in July. Strategy reported a $0.50 per share payment for August 15, while emphasizing that future distributions are still subject to approval and are not guaranteed.
Strategy projected STRC distributions to be treated as returns of capital for US tax purposes up to an investor’s tax basis. Additionally, STRC is unsecured, not supported by Bitcoin, not FDIC-insured, and does not deliver security of Treasuries or money-market funds.
