Paris-based Sequans Communications sold 1,025 bitcoin during the first quarter of 2026, cutting its digital asset reserves nearly in half as the IoT semiconductor maker grappled with declining revenue and mounting losses tied to a treasury strategy that has turned from ambitious to burdensome.
The sale reduced Sequans’ bitcoin position from 2,139 BTC at year-end 2025 to 1,114 BTC by April 30, marking the second major disposal in six months for a company that less than a year ago proclaimed plans to accumulate 3,000 bitcoin as a “long-term store of value”.
The financial pressure is evident in the numbers. Sequans reported revenue of $6.1 million for the quarter ended March 31, down 24.8% from $8.1 million a year earlier. The year-over-year comparison reveals the company’s vulnerability: the prior-year period included significant license and services revenue from Qualcomm that did not recur, exposing the underlying weakness in product sales.
While product sales did increase 45% from the year-ago quarter, gross margin compressed to 37.7% from 64.5% as lower-margin hardware displaced the lucrative licensing income. For a company burning cash, the shift in revenue mix compounds the challenge.
Sequans’ Bitcoin strategy became a burden
The bitcoin holdings that CEO Georges Karam once framed as a balance-sheet asset have become a source of substantial losses. Operating losses reached $50.5 million in the quarter, driven by $29.3 million in unrealized impairment charges on bitcoin holdings and $11.7 million in realized losses from selling the digital assets.
The company used bitcoin sale proceeds to redeem convertible debt and fund an American Depositary Share buyback program, a pragmatic move to reduce liabilities but one that underscores how the treasury strategy has shifted from accumulation to liquidation.
The remaining bitcoin holdings are largely encumbered. Of the 1,114 BTC held as of April 30, 817 bitcoin — representing 73% of current holdings valued at $62.3 million — remained pledged as collateral for $35.9 million in outstanding convertible notes. The pledged bitcoin exceeds the debt value, reflecting the over-collateralization required by lenders wary of cryptocurrency volatility.
The remaining debt is scheduled for redemption by June 1, 2026, after which all bitcoin will be unrestricted and available for sale. Whether Sequans will retain those assets or continue liquidating to fund operations remains an open question.
Net loss totaled $54.3 million, or $3.73 per diluted ADS, compared to $7.3 million, or $0.29 per ADS, in the prior-year quarter. Even on a non-IFRS basis—which excludes impairment charges, stock-based compensation, and accounting adjustments related to convertible debt—the net loss was substantial at $20.7 million, or $1.42 per ADS.
CEO Georges Karam framed the bitcoin sales as “decisive steps to simplify and strengthen our balance sheet,” while highlighting momentum in the company’s core IoT semiconductor business.
He cited a growing backlog, maturing design wins, and customer interest in Cat-M, Cat-1bis, and 5G eRedCap connectivity solutions, as well as new RF transceivers for drones and defense applications.
Sequans shares have fallen 51.5% over the past six months to $3.01, reflecting investor skepticism about both the bitcoin strategy and the core business trajectory.
The company ranks 40th among publicly traded firms holding bitcoin, far behind Strategy’s 818,334 BTC and Twenty One Capital’s 43,514 BTC.
