The company known for developing healthcare technology, is making some noise by adopting a strategy similar to MicroStrategy’s when it comes to Bitcoin.
The firm announced it has added 47 bitcoin to its portfolio since late August, bringing its total holdings to 1,058 BTC, which they purchased for $71 million.
The path is known, but who will follow?
Semler isn’t just about medical devices, they’re also stepped into the crypto world in the Spring, and now, they’re looking to expand their financial horizons by accumulating Bitcoin.
This latest purchase raises questions about whether Semler and its investors are preparing for a significant shift in the crypto market.
To fund their Bitcoin buys, Semler is using a mix of operating cash flow and an at-the-market stock offering program.
Since launching this program in August 2024, they’ve raised around $2.5 million by selling over 86,000 shares.
The ATM program allows them to sell up to $50 million worth of their common stock, giving them flexibility in funding future purchases.
Eric Semler, the company’s chairman, mentioned they’re also exploring more financing options specifically for acquiring additional Bitcoin—echoing MicroStrategy’s approach of raising funds through debt and equity.
From where comes the money?
Despite these ambitious plans, Semler faced challenges in Q3 2024. Their revenue fell to $13.5 million, down 17% from $16.3 million the previous year.
They still managed to stay profitable with an operating income of $5.1 million—though that was a 20% drop from last year’s $6.3 million.
On a brighter note, their net income slightly improved to $5.6 million, up 2% from $5.5 million in Q3 2023.
This boost was helped by an unrealized gain of $1.1 million from their Bitcoin holdings and a lower effective tax rate of 12%, compared to 21% last year.
Concerns are there, as risks too
One thing to keep an eye on is Semler’s customer concentration, their two largest clients accounted for 73% of Q3 revenues, or 44% and 29% respectively.
This marks an increase from the previous year when the top three customers made up 75% of revenue.
As of September 30, Semler held 1,018 bitcoins valued at about $64.5 million, reflecting a cumulative reduction in fair value of $3.9 million.
During Q3 alone, they purchased 141 bitcoins for $8.4 million and added another 40 bitcoins for $2.6 million between the end of the quarter and November 4.
