Strategy shares fell 4.56% to $93.28 on July 31 after the company posted an $8.22 billion quarterly loss tied to Bitcoin's price decline. Executive Chairman Michael Saylor said Strategy will hold both cash and Bitcoin rather than commit all available capital to new purchases, while CEO Phong Le said the company won't buy more Bitcoin until its STRC preferred stock returns to its $100 par value.
Strategy stock slides after $8.22B quarterly loss
Strategy shares fell 4.56% to $93.28 on July 31, after trading as low as $89.21 during the session — the first time the stock dropped below $90 since July 1. The decline followed a quarterly report that included an $8.32 billion unrealized loss on the company's Bitcoin holdings. That loss pushed the company to a net loss of $8.22 billion, or $24.45 per share for the quarter.
The company held 843,775 BTC at the end of the quarter, a 25% increase from the start of the year. It acquired those holdings for about $63.69 billion at an average price of $75,476 per coin. Lower Bitcoin prices cut the market value of the position to about $54.77 billion.
Because Strategy uses fair-value accounting, swings in Bitcoin's market price flow directly through its reported earnings. Operating revenue was one bright spot, however: it rose 6.9% to $122.4 million from $114.5 million a year earlier.
Why Strategy is holding off on new Bitcoin purchases
Executive Chairman Michael Saylor said Strategy would keep both cash and Bitcoin rather than direct all available funds toward new purchases. He said during the earnings call that the goal was "not to buy the most Bitcoin immediately."
CEO Phong Le said the company would refrain from buying additional Bitcoin while STRC trades below its $100 par value; the preferred stock closed July 31 near $89. Strategy repurchased about $25 million of STRC between July 20 and July 24. It also raised $544 million through common-stock sales — moves that suggest management views supporting the preferred shares as necessary to preserve its capital-raising model. The company also held a $3.75 billion cash reserve, giving it room to cover dividend and interest obligations without selling Bitcoin.
Wall Street keeps bullish ratings despite the sell-off
Benchmark maintained its buy rating on Strategy but cut its price target to $435 from $570; analyst Mark Palmer said Saylor's focus on restoring STRC to par could strengthen the company's ability to fund future Bitcoin purchases. H.C. Wainwright also kept a buy rating and assigned a $325 price target, citing the cash reserve and STRC repurchases as steps that could shore up the balance sheet.
Both targets imply substantial upside from Thursday's close. However, the firms' outlooks still depend on Bitcoin's price and on Strategy's ability to raise capital on favorable terms. Management's shift toward preserving cash does not mean abandoning the Bitcoin strategy — it delays new purchases while the company works to support the securities that finance them.
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