Semler Scientific's Bitcoin Bet: A Bold Move in Q3 2024

In the dynamic world of healthcare and technology, Semler Scientific, Inc. (Nasdaq: SMLR) has made a strategic shift that has captured investors' attention. The company, known for its innovative medical products and services, has adopted bitcoin as its primary treasury reserve asset. This bold move, announced in Q3 2024, has significant implications for the company's financial stability and long-term growth.

Semler Scientific's Q3 2024 earnings report highlighted the company's commitment to its bitcoin strategy. The company purchased an additional 47 bitcoins for an aggregate amount of $3.0 million, bringing its total holdings to 1,058 bitcoins, valued at $71.0 million as of November 4, 2024. This strategic shift underscores Semler Scientific's belief in bitcoin's potential as a reliable store of value and a compelling investment.

The company's chairman, Eric Semler, has expressed confidence in bitcoin's unique characteristics as a scarce and finite asset, making it a reasonable inflation hedge and safe haven amid global instability. Semler Scientific's bitcoin treasury strategy aligns with its core healthcare business, providing a hedge against currency risk and diversifying its revenue streams.

However, the volatility of bitcoin poses risks to Semler Scientific's financial stability. In Q3 2024, the company reported a cumulative reduction in fair value of $3.9 million due to bitcoin's price fluctuations. Despite these risks, Semler Scientific's long-term outlook for bitcoin remains positive, given its growing global acceptance and 'institutionalization.'

Semler Scientific's bitcoin strategy has contributed to its revenue growth and profitability. The company's income from operations remained strong at $5.1 million, despite a 20% decrease from the previous year. The unrealized gain of $1.1 million from the change in fair value of Semler Scientific's bitcoin holdings contributed to its pre-tax income of $6.4 million.


Semler Scientific's bitcoin strategy sets it apart from other healthcare companies, which typically focus on core medical products and services. While the company's core healthcare business generates stable profits and cash flows, its bitcoin holdings serve as a hedge against inflation and currency risk.


In conclusion, Semler Scientific's bitcoin strategy is a bold move that has contributed to its revenue growth and profitability. While the volatility of bitcoin poses risks, the company's diversified revenue streams and long-term outlook for bitcoin make this strategy an attractive option for investors. As Semler Scientific continues to generate revenue and free cash flow from sales of QuantaFlo, it will proactively evaluate its use of excess cash, with bitcoin serving as its principal treasury holding on an ongoing basis. This strategic shift towards bitcoin as a reserve asset is expected to generate outsize returns for Semler Scientific's shareholders in the long term.