Strategy stock rises after disclosing new bitcoin purchase

Strategy (MSTR) shares climbed more than 7 percent in pre-market trading Monday following a disclosure that the company acquired additional bitcoin and repurchased preferred stock during the prior week. The trading activity pushed the stock back into positive territory for the year, marking a reversal after a period of significant losses for the firm.

In an 8-K filing released Monday, Strategy reported the purchase of 950 bitcoin and the repurchase of approximately 1.77 million shares of its preferred stock (STRC). The company also allocated $57.4 million to cover dividends on preferred stock and outstanding interest payments. Following these transactions, Strategy stated that its USD reserves stood at $1.05 billion and its cash reserves at $5.04 billion.

The disclosure arrived as broader crypto assets rallied, with bitcoin's price surging more than 6 percent to trade above $85,000, a level not seen since January. The market movement followed a cryptic Sunday post on X by Strategy founder Michael Saylor, which read "a little more orange."

Pressure on Strategy had intensified earlier this year as the crypto market entered a prolonged downturn. The company's financial strategy faced strain amid lower asset prices, forcing it to sell bitcoin and stock to generate funds for debt service and preferred stock dividends. After the crypto industry's major legislative bill failed to advance in the Senate, Saylor and Coinbase CEO Brian Armstrong urged the sector to move past the setback, suggesting the industry might benefit from the legislation's absence.