Business Wire·Feb 2, 2026, 4:00 PM ET

Strategy's Distributions to Digital Credit Investors in 2025 are Return of Capital

MSTR STRC STRD STRF STRK

Strategy Inc announced that 100% of distributions paid in 2025 on its preferred equity instruments are treated as a nontaxable return of capital (ROC) to the extent of a shareholder's tax basis.
Distributions reduce a shareholder's tax basis, with any excess amount treated as capital gain for U.S. federal income tax purposes.
Forms 8937 detailing these distributions are available on Strategy's investor relations website.
In 2025, Strategy executed five initial public offerings of perpetual preferred equity securities ("Digital Credit") raising $5.5 billion, followed by an additional $1.9 billion raised through At-The-Market programs.
Cumulative distributions paid on these instruments total $413 million, representing a blended annual dividend rate of 9.6%.
Strategy reports having no accumulated earnings & profits (E&P) for U.S. federal income tax purposes \& expects to generate none in the current year or foreseeable future.
Based on the lack of E&P, Strategy expects distributions to continue being treated as ROC for ten years or more.
Strategy advises shareholders to consult tax advisors regarding specific federal, state, local, \& non-U.S. tax consequences.
Strategy Inc is described as the world's first \& largest Bitcoin Treasury Company, offering securities providing economic exposure to Bitcoin alongside AI-powered enterprise analytics software.
The press release includes forward-looking statements regarding the tax treatment of dividends, noting that actual results may differ materially from expectations.