TSS (TSSI) investor relations material

Executive summary

• Achieved record revenue and profitability in 2025, with full-year revenue reaching $245.7M, a 66% increase year-over-year, driven by strong AI rack integration demand and operational improvements.

• Net income for 2025 totaled $15.1M, up 153% year-over-year, and diluted EPS improved 133% to $0.56 per share.

• New Georgetown, TX facility scaled successfully, ramping systems integration volumes in Q4 and supporting higher AI-related volumes.

• Amended and extended primary customer agreement, enhancing revenue visibility, extending term by two years, and recouping prior infrastructure investments.

• AI adoption is broadening across enterprises, fueling robust demand for complex, power-dense infrastructure.

Financial highlights

• Full year revenue rose 66% to $245.7M, with procurement services up 68% to $197.5M and systems integration up 78% to $40.3M year-over-year.

• Net income increased 153% to $15.1M, aided by a $7.6M one-time income tax benefit from DTA valuation allowance reversal.

• Adjusted EBITDA reached $18.6M, up 83% from $10.2M in 2024, exceeding guidance.

• Q4 2025 revenue was $60.9M, up 22% year-over-year; Q4 gross profit rose 57% to $11.3M.

• Cash flow from operations more than doubled to over $30M; unrestricted cash ended at $85.5M.

Outlook and guidance

• Forecasting 2026 adjusted EBITDA of $20–$22M, with potential for further upside as demand accelerates.

• Expecting to double rack integration business in 2026 compared to 2025, with short-term forecasts already exceeding plan.

• Procurement and facilities management outlook remains conservative due to pipeline rebuilding and supply chain volatility, but optimism remains.

• Total integration demand exceeds forecasted volumes.