MicroStrategy Stock Rises 12% as Cash Reserves Nearly Cover Debt

MicroStrategy (ticker: MSTR) saw its shares jump 12% on Thursday after the company disclosed that its dollar reserves now offset almost all of its $6.75 billion debt load. The announcement reduced the firm’s net leverage to roughly 0.1%, suggesting that its Bitcoin holdings are largely insulated from liquidation pressure.

Cash‑Debt Balance Improves

The company reported $6.69 billion in cash against $6.75 billion of debt, leaving a gap of about $60 million. A $5.10 billion portion of the cash reserve is earmarked for dividend and interest payments, having grown from $4.0 billion at the start of August following a $3.28 billion capital raise.

Impact on Bitcoin Treasury

MicroStrategy’s Bitcoin treasury holds approximately 840,447 BTC, valued at roughly $67.9 billion with Bitcoin trading above $80,000 at the time of reporting. The firm’s average purchase price of $75,419 per BTC means the treasury sits at a modest profit margin of about 4%.

Market Reaction

The stock rose to $138.38 by midday Thursday, narrowing its year‑to‑date decline to under 9%. The rally builds on a broader crypto‑stock rally that lifted MSTR to a two‑month high earlier in the week.

Remaining Considerations

• Preferred shares (STRC) carry a 12% annual dividend and rank ahead of common stock in the capital structure.
• Recent cash inflows were largely generated by issuing new MSTR shares, which dilutes existing shareholders.
• The company sold 1,638 BTC in July at about $64,000 each, a move that had previously fueled concerns about liquidity during a crypto market downturn.

Analysts will watch whether MicroStrategy resumes Bitcoin purchases or continues to prioritize cash accumulation.