Strategy to Shift from Equity to Preferred Stock Financing for Bitcoin Acquisition

On February 12, Strategy CEO Phong Le announced during a Bloomberg live broadcast that the company plans to gradually reduce equity financing and instead utilize preferred stock financing to fund its Bitcoin acquisitions. According to BlockBeats, equity financing can dilute existing shareholders' holdings and earnings per share, amplifying losses during volatile stock price periods, especially when Bitcoin prices fall. Although equity financing has lower costs and no fixed dividend pressure, preferred stock financing offers fixed dividend priority without diluting common stock control and voting rights. This approach provides more stable financing and appeals to conservative investors, despite the permanent dividend obligation and relatively higher costs. Strategy's shift to preferred stock financing aims to continue Bitcoin purchases during market fluctuations while minimizing dilution pressure on common shareholders.