In recent months, the unconventional tactics employed by Michael Saylor at Strategy, previously known as MicroStrategy, have drawn significant attention. While much of the coverage has centered around the firm’s Bitcoin investments, a critical shift in its operational strategy has largely gone unnoticed: Saylor’s widespread issuance of new shares.
Since Saylor began accumulating Bitcoin in Q2 2020, the number of outstanding shares of Strategy has surged from 76 million to approximately 314 million, reflecting an astonishing 313% increase. This marked dilution is unprecedented among large-cap U.S. companies. For context, the next closest example over the same timeframe is Wayfair, which saw a 30% dilution, a staggering one-tenth of Strategy’s.
The unique model employed by Strategy focuses on increasing the amount of Bitcoin owned by each share, a metric referred to as Bitcoin per share (BPS). Historically, the firm raised funds through equity offerings, using the proceeds to acquire more Bitcoin. This method effectively allowed Saylor to leverage the inflated stock prices to purchase additional Bitcoin, thus enhancing the perceived value for shareholders.
From late 2023 until mid-July 2025, shares of Strategy skyrocketed over seven-fold, while Bitcoin’s price increased only 2.8 times. This scenario enabled Saylor to buy significantly more Bitcoin by selling the same number of shares as before, up to 3.8 tokens for every 1,000 shares sold, enhancing shareholder value.
However, this strategy has recently faced severe challenges. After peaking in the summer of 2025, Strategy’s shares have plummeted by 72%, falling from $457 to $130. In contrast, Bitcoin dropped 51%, from $129 to $68 during the same period. The previous model of “accretion” through dilution failed as shares began to devalue further, resulting in a decline in the BPS ratio.
In a bid to maintain BPS amidst declining stock prices, Saylor pivoted towards a riskier financing strategy that involves issuing preferred stock. This move has allowed Strategy to raise an additional $7 billion, which somewhat stabilized the BPS, but highlights the precarious balance the company must maintain to avoid diluting shareholder value further.
To compound matters, Strategy has accumulated a significant amount of debt, totaling $8.2 billion, with preferred stock obligations costing the company nearly $888 million annually in dividends. Additionally, Saylor faces a challenging task ahead in refinancing $6 billion in debt scheduled for 2028, which he intends to achieve by issuing more shares, a process he refers to as “equitizing” the debt.
This approach poses a risky dilemma for Saylor. It requires a soaring stock price to support ongoing operations while managing substantial dividend payments from dwindling reserves. As Bitcoin’s price falters, it increasingly appears that Saylor’s strategy of maintaining large share counts may undermine the very goal he champions.
The prevailing view of dilution in the tech sector emphasizes share count reduction as a sign of financial health. Saylor’s aggressive issuance of shares contradicts this norm, leaving him navigating a precarious situation. The overall performance of Strategy over the past two years has proven disappointing, prompting serious concerns about its long-term viability as an investment, amid growing fears that the company may be on an unsustainable path.
