TSS Posts Quarterly Revenue of $50.1 Million and Raises 2026 Adjusted Profit Outlook

Key Facts

TSS reported results on November 5 for the third quarter ended September 30, 2026, posting revenue of $50.1 million, up 20% from the same period a year earlier. The company raised its full-year adjusted EBITDA outlook to a range of $21–23 million. It said it expects further growth in the fourth quarter. The company provides integration and related services for data center infrastructure serving artificial intelligence and high-performance computing. The results came as systems integration expanded its share, an activity the company described as higher margin.

Systems integration revenue reached a quarterly record of $16.1 million, up 75% year over year, and accounted for 32% of total quarterly revenue. The company attributed the growth to higher volumes, and CEO Daryl Dwan said the record revenue reflected investment and a strategic focus on continuing to grow in AI and high-performance computing infrastructure integration. Dwan said, "This quarter's record systems integration revenue reflects the investment and strategic focus to position TSS to continue to grow." The performance of this activity was the leading driver of quarterly revenue growth, according to the figures reported by the company. Its larger contribution to sales also illustrates a shift in the business mix toward technology infrastructure services.

By contrast, procurement revenue was $32.4 million, up 4% year over year, and remained the largest component of quarterly revenue among the activities included in the results. Facilities management revenue was $1.1 million, down 30% from the third quarter of the previous year. The figures show divergent performance across the company's business units: strong growth in systems integration, limited growth in procurement and a decline in facilities management. Overall revenue growth came alongside expansion in the higher-margin activity, as the company described systems integration. That gives the quarterly revenue mix added importance when assessing results alongside the total sales figure.

The picture for the first nine months was different from that of the standalone quarter: total revenue fell 24% to $140.5 million compared with the same period in 2025. Procurement revenue declined 41% to $90.6 million, while systems integration revenue rose 68% to $44.1 million. Facilities management revenue also increased 17% to $5.1 million during the period. The divergence highlights the impact of weaker procurement on total revenue year to date, despite growth in systems integration and facilities management. At the same time, the company recorded a year-over-year increase in third-quarter revenue, with systems integration growing faster than total revenue.

Adjusted EBITDA was $14.5 million in the first nine months of 2026, up 35% from the corresponding period a year earlier. The company said the shift in total revenue toward higher-margin systems integration contributed to the increase. The new annual outlook range of $21–23 million is based on this adjusted measure, while the company pointed to expected further growth in the fourth quarter. The results thus link improved adjusted profitability with a change in the business mix, while cumulative revenue for the first nine months remained below its level a year earlier. The new outlook applies specifically to the adjusted profit measure defined by the company, not to revenue for the year.

On operational expansion, TSS signed a seven-year lease for approximately 380,000 square feet of additional warehouse space in Georgetown, Texas. The company said the new space is intended to expand supply chain capacity and support increasing customer volumes. It also said preparations to integrate and deploy next-generation AI technologies were completed shortly after the end of the quarter. These steps come in the context of the company's services related to data center infrastructure, AI and high-performance computing. In trading, TSSI shares closed at $5.95 on November 5, according to EL7 daily data.