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Investing.com -- TSS, Inc. (NASDAQ:TSSI), a data center services company, reported a substantial increase in first-quarter earnings and revenue, driven by strong growth in its AI rack integration services. The company’s stock surged 41.6% following the announcement.
For the quarter ended March 31, 2025, TSS reported earnings per share of $0.12, a significant improvement from breakeven in the same period last year. Revenue skyrocketed 523% YoY to $99 million, fueled by exponential growth in the Procurement and Systems Integration segments.
The company’s Procurement revenues soared 676% to $90.2 million, while Systems Integration revenues jumped 253% to $7.5 million. However, Facilities Management revenues declined 40% to $1.3 million.
CEO Darryll Dewan commented, "We are off to a strong start in 2025, with exponential increases in both our top and bottom lines, driven by robust growth in our Procurement and Systems Integration segments, including incremental contribution from AI rack integration services."
TSS began production at its new facility on May 7, which is expected to significantly increase the company’s data center rack integration capacity. The facility is on track to be fully operational across all capabilities in June.
Looking ahead, TSS anticipates continued growth in its core businesses and expects some acceleration in AI rack integration services revenues beginning in the second quarter. The company projects total revenue in the first half of 2025 to exceed that of the second half of 2024, and expects Adjusted EBITDA for the full year 2025 to be at least 50% higher than 2024.
Dewan concluded, "We are highly optimistic about our growth prospects for 2025 and beyond. Our new facility marks the beginning of a new and exciting chapter for TSS."
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