TLDR
- Sequans Communications sold 970 bitcoin to redeem 50% of its convertible debt, cutting total outstanding debt from $189 million to $94.5 million
- The company now holds 2,264 bitcoin worth approximately $240 million, with its debt-to-NAV ratio dropping from 55% to 39%
- Sequans appears to be the first pure-play bitcoin treasury company to actually sell portions of its holdings after adopting the strategy earlier in 2025
- The stock has dropped 82% year-to-date and fell another 9% following the announcement, with shares down 72% over the past year
- CEO Georges Karam stated the bitcoin treasury strategy remains unchanged and described the sale as a tactical decision to unlock shareholder value
Sequans Communications made an unexpected move Tuesday by selling nearly one-third of its bitcoin holdings to pay down debt. The decision marks a turning point for the wave of companies that rushed to adopt bitcoin treasury strategies this year.
Sequans Communications S.A., SQNS
The Paris-based semiconductor provider sold 970 bitcoin to redeem half of its July 2025 convertible debt. The sale reduced total outstanding debt from $189 million to $94.5 million.
Sequans currently trades at $7.10 per share. The stock dropped 9% following the announcement and is down 82% year-to-date.
The company now holds 2,264 bitcoin in its treasury. Based on current market prices, these holdings are worth approximately $240 million.
Debt Reduction Changes Financial Picture
The debt paydown changed Sequans’ financial metrics substantially. The company’s debt-to-net asset value ratio fell from 55% to 39%.
CEO Georges Karam defended the move as tactical rather than strategic. “Our Bitcoin treasury strategy and our deep conviction in Bitcoin remain unchanged,” Karam said in a statement.
The company emphasized that current market conditions made the debt reduction an opportunity to unlock shareholder value. Sequans adopted bitcoin as its primary treasury reserve asset earlier in 2025.
The convertible debt being redeemed was issued less than four months ago in July. The quick reversal raises questions about the timing and planning behind the original debt issuance.
Sequans specializes in wireless 4G and 5G cellular technology for Internet of Things applications. The company maintains offices across the United States, United Kingdom, Switzerland, Israel, Finland, Taiwan, and China.
According to the company’s announcement, the debt reduction removes certain covenant constraints. This provides increased financial flexibility for future operations.
Capital Markets Strategy Shifts
Sequans stated it now has better positioning to pursue various capital market initiatives. These include an expanded ADS buyback program and potential issuance of preferred shares.
The company also mentioned plans for yield generation on portions of its remaining bitcoin holdings. Details on these yield strategies were not provided in the announcement.
B.Riley Securities initiated coverage on Sequans with a Buy rating and $13.00 price target prior to this announcement. The firm’s analysis indicated the company was trading at 0.7 times its modified net asset value.
Sequans appears to be the first among pure-play bitcoin treasury companies to actually sell holdings. Other firms that adopted similar strategies in 2025 have maintained their positions despite market volatility.
The company joins a growing list of bitcoin treasury firms trading below the value of their bitcoin holdings. This dynamic makes raising additional capital challenging.
Sequans reported second quarter revenues of $8.1 million, up 1.1% year-over-year. The company posted a net loss of $9.1 million for the quarter.
InvestingPro data shows Sequans holds more cash than debt on its balance sheet. The company maintains a current ratio of 1.83.
The company sold 970 bitcoin from its previous holdings of 3,234 bitcoin, leaving it with 2,264 bitcoin worth roughly $240 million at current market prices.
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