đź‘» Semler’s Wild Bet: Bitcoin to Revive Zoom’s Corpse? đź‘»

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In a move that would make even the most jaded of investors raise a well-groomed eyebrow, Mr. Eric Semler, the illustrious chair of Semler Scientific, has implored the rather lifeless Zoom Communications to infuse its rather considerable pile of $7.7 billion in cash reserves into the enigmatic embrace of Bitcoin. Semler, ever the optimist, suggests this audacious act could inject vitality into the company’s veins and enhance shareholder value. 

As per an X post, the cunning Semler boasts of his own firm’s dalliance with the digital currency, having accumulated a trove of 3,192 BTC, currently valued at $305 million, which, much to the surprise of naysayers, has managed to double its stock price since last year. A triumph, one might say, in a world where such victories are as rare as a modest Oscar Wilde quote.

Labeling Zoom as a “Zombie Zone” company, Semler points out its less-than-enthralling market performance with the sort of glee one reserves for a particularly juicy piece of gossip. Over the past three years, Zoom’s shares have descended to the tune of roughly 40%, lagging behind the S&P 500 by approximately 73%. A performance as inspiring as a wet blanket at a fireworks display.

In the last five years, the spectacle of Zoom trailing the S&P by about 84% has been as thrilling as watching paint dry. Despite its forward earnings multiple of 15x and forward EBITDA multiple of 9x, Semler dryly notes that Zoom’s valuation remains as low as one’s spirits after a dinner with no dessert.

Oh, the thrill of the Zombie Zone! A veritable feast for the discerning investor. So many undead companies to choose from, but one in particular stands out like a beacon of boredom – and naturally, it begins with the letter Z.
 
Zombie Zone company #1: Zoom Communications
 
Why $ZM is the quintessential…

— Eric Semler (@SemlerEric) February 13, 2025

Zoom, with its coffers brimming with $7.7 billion in cash—a sum nearly one-third of its $25 billion market cap—seems to have no clearer plan for its riches than a child with a sugar rush. Yet, the company maintains profitability that would make Scrooge McDuck envious, with ~40% EBITDA margins and $458 million in cash generated last quarter. Alas, its revenue growth outlook is as promising as a politician’s promise.

Semler, ever the dramatist, argues that embracing a Bitcoin treasury strategy could elevate Zoom to the pantheon of the largest corporate Bitcoin (BTC) holders—a move as bold as wearing a peacock feathered hat to a funeral. Leveraging its $2 billion in annualized free cash flow and access to low-cost debt, Semler dreams of a renaissance for the video conferencing giant.

He stressed that the fate of this strategy lies in the hands of Zoom’s founder and CEO, Eric Yuan, who wields super-voting shares with the same discretion as one might use a sledgehammer. Yet, Yuan has remained as silent on Bitcoin as a cat on a hot tin roof.

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2025-02-13 22:41