Financial Pressure Forces Sequans to Shed Half Its Bitcoin
Paris-based IoT chip maker Sequans Communications sold 1,025 bitcoin during the first quarter of 2026, cutting its digital asset reserves nearly in half. The company held 2,139 BTC at year-end 2025 but only 1,114 BTC by April 30, 2026. This marks the second major disposal in six months for a firm 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 prior-year period included significant license and services revenue from Qualcomm that did not recur, exposing underlying weakness in product sales.
While product sales did increase 45% year-over-year, gross margin compressed to 37.7% from 64.5% as lower-margin hardware displaced lucrative licensing income. For a cash-burning company, the shift in revenue mix compounds the challenge.
Bitcoin Strategy Shifts from Asset Reserve to Financial Burden
CEO Georges Karam once framed the bitcoin holdings as a balance-sheet asset, but they 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 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 the shift from accumulation to liquidation. Of the 1,114 BTC held as of April 30, 817 bitcoin (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 over-collateralization required by lenders wary of cryptocurrency volatility. The remaining debt is due for redemption by June 1, 2026, after which all bitcoin will be unrestricted and available for sale.
Net loss totaled $54.3 million, or $3.73 per diluted ADS, compared to $7.3 million ($0.29 per ADS) a year earlier. Even on a non-IFRS basis — excluding impairment charges, stock-based compensation, and accounting adjustments related to convertible debt — the net loss was $20.7 million ($1.42 per ADS).
CEO Georges Karam described the bitcoin sales as 'decisive steps to simplify and strengthen our balance sheet,' while highlighting momentum in the core IoT semiconductor business. He cited a growing backlog, maturing design wins, 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.