TSS Inc. (TSSI) Shifts Focus Toward AI Data Centers Amid Revenue Transition
On August 13, TSS Inc. reported second-quarter results showing a 20% year-over-year revenue decline to $35.1 million but an increase in gross profit and adjusted EBITDA by 11% and 12%, respectively. The company is pivoting away from lower-margin procurement work toward systems integration for AI and high-performance computing (HPC) infrastructure, which grew 46% year-over-year to $13.9 million or 39% of total revenue. TSS plans a $17 million investment in next-generation AI data center technology expected to boost third-quarter systems integration revenue. The company also reactivated an idle facility for warehouse operations and maintained full-year adjusted EBITDA guidance between $20 million and $22 million, with expectations that the second half will outperform the first. Despite these strategic moves, procurement revenue fell 45% to $18.2 million in Q2 and is down 53% year-to-date. Net income also declined slightly on a per-share basis due to increased depreciation costs.
Tickers: $TSSI
Topics: AI data centers EBITDA growth revenue shift systems integration