Semler Scientific Stock Plummets 44% on Revenue Drop, Invests in Bitcoin

Semler Scientific, a medical device company, experienced a significant decline in its stock price during after-hours trading following the release of its first-quarter earnings report. The company reported a substantial drop in revenue for the quarter, which led to investor concerns and a subsequent sell-off of the stock. The revenue plunge was attributed to various factors, including reduced demand for the company's products and increased competition in the market. The after-hours trading session saw a notable decrease in the stock price, reflecting the market's reaction to the disappointing financial results.

The company's first-quarter earnings report, released on May 13, revealed that total revenues fell by 44% from the year-ago quarter to $8.8 million. This decline was accompanied by a deepening of net losses, which hit $64.7 million compared to a net income of $6.1 million in the first quarter of 2024. The significant drop in revenue and the widening of losses raised concerns among investors about the company's financial health and future prospects.

Despite the challenging financial results, Semler Scientific has been actively investing in Bitcoin as part of its strategic initiatives. The company reported purchasing 894 Bitcoin (BTC) during the first quarter, bringing its total holdings to 3,192 BTC at a fair value of $263.5 million at the end of the quarter. This investment reflected a cumulative decrease of $16.9 million. Additionally, between the end of the first quarter and May 12, Semler acquired an additional 616 BTC for a total cost of $59.6 million, increasing its holdings to 3,808 BTC at a fair value of $387.9 million. The company's Bitcoin holdings have generated an unrealized gain of $41.6 million over the first quarter, with paper gains continuing to climb to $52 million as of May 12.

Semler Scientific's aggressive Bitcoin investment strategy is part of a broader trend among corporations and businesses that have been increasing their Bitcoin holdings. According to data from Bitcointreasuries.net, nearly 787,000 BTC is held by a total of 104 public companies. Strategy, formerly MicroStrategy, has been the largest Bitcoin buyer and currently holds more than 568,000 BTC, or nearly 2.7% of Bitcoin’s total supply. Analysts have stated that Bitcoin is now deflationary, as Strategy has claimed it has no plans to sell its Bitcoin holdings.

Semler Scientific's management acknowledged the challenges faced during the first quarter but expressed optimism about future prospects. The company is committed to its long-term growth strategy and continues to invest in research and development to drive innovation in the medical device industry. Despite the setback, Semler Scientific remains focused on improving its product offerings and expanding its market reach to overcome the current challenges and achieve sustainable growth.