Bitcoin News Today: Sequans' 'Tactical' Bitcoin Sale Fails to Quell Investor Skepticism, Shares Fall 16%

Sequans Communications SA (SQNS) shares plummeted 16% on Tuesday after the chipmaker sold 970 Bitcoin to redeem half of its $189 million convertible debt, a move that cut its Bitcoin holdings from 3,234 to 2,264 coins. The transaction, described as a "strategic asset reallocation" by CEO Georges Karam, reduced Sequans' debt to $94.5 million while maintaining its long-term Bitcoin treasury strategy, according to a Cointelegraph report. Despite the CEO's assurances, the stock dropped to $5.92, marking an 89% decline from its 2025 high.

The sale, which generated approximately $97 million, was part of a broader effort to strengthen Sequans' financial flexibility. The company also announced a 20% cost-reduction program and aims to reach break-even by Q4 2026, as Investing.com highlights. Karam emphasized that the Bitcoin treasury remains a core component of the firm's strategy, stating the move was "tactical" rather than a shift in conviction, according to a Decrypt article. However, analysts questioned the sustainability of Bitcoin treasury strategies for companies with weaker financial positions, noting that many crypto-focused firms have seen stock declines after initial hype faded, per Markets.com analysis.

Sequans' third-quarter 2025 results underscored the challenges. Revenue fell 47.3% quarter-over-quarter to $4.3 million, driven by the end of Qualcomm licensing revenue and production delays, as Investing.com highlighted. Gross margin dropped to 40.9% from 64.4% in Q2, reflecting a lower proportion of high-margin licensing income, again noted by Investing.com. The company reported an operating loss of $20.4 million, including an $8.2 million unrealized loss on Bitcoin impairment, according to a Stocktitan report. Cash reserves dwindled to $13.4 million by September 30, 2025, excluding a $10 million payment from a prior Qualcomm deal, the Stocktitan report said.

The Bitcoin sale aligns with a growing trend of institutional adoption, with over 200 public companies now holding the cryptocurrency. Sequans' move follows MicroStrategy's aggressive accumulation of 641,205 BTC and other firms seeking to diversify reserves, as Decrypt reported. However, the transaction drew scrutiny from regulators and analysts. The SEC recently halted trading of QMMM Holdings to investigate potential stock manipulation linked to crypto purchases, Decrypt reported, while experts warned of the volatility inherent in crypto treasuries, according to Markets.com.

Karam highlighted opportunities in Sequans' IoT business, including a $550 million three-year pipeline and a new IP initiative expected to generate high-margin revenue in 2026, as Investing.com highlighted. The company also explored licensing deals for 5G RedCap technology, with potential upfront payments ranging from $3 to $5 million, Investing.com said. Despite these efforts, Sequans' stock performance has lagged, reflecting investor skepticism about its ability to balance Bitcoin exposure with operational growth, the Cointelegraph report added.

The sale has positioned Sequans as the 33rd largest corporate Bitcoin holder, down from 29th in July, according to a Coinotag report. While the firm remains committed to accumulating 100,000 BTC over five years, the recent divestment highlights the financial pressures facing companies with dual focus on crypto and traditional operations, the Coinotag report noted. As the market digests the move, Sequans' ability to stabilize its IoT revenue and navigate regulatory scrutiny will be critical to restoring investor confidence, Markets.com observed.