TSS, Inc. Q3 2026 Earnings Recap

Shares rose 12.6% after TSS reported 20% revenue growth and record Systems Integration revenue, with the higher-margin business contributing to a sharp increase in adjusted EBITDA. Management also pointed to further Systems Integration growth in Q4 and into 2027, though it noted variable customer order timing and did not provide a full-company outlook in the available transcript.

Key Takeaways

• Q3 revenue increased 20% year over year to $50 million; management said revenue rebounded into its historical range.
• Systems Integration revenue reached a record $16.1 million, up 75% year over year and 16% sequentially. Rack processing was up 248% year over year and 57% sequentially.
• Adjusted EBITDA rose 225% to $4.7 million. Management attributed improved profitability in part to growth in the higher-margin Systems Integration business.
• TSS expects Systems Integration volume trends to continue growing in Q4 and into 2027, and said current activity and its pipeline point to further sequential growth in Q4.
• The company took possession of about 126,000 square feet of a new Georgetown warehouse in October; full use of both buildings, under a seven-year lease and customer warehousing agreement, is expected after tenant improvements in 2027. Management flagged variability in customer order timing and deployment schedules.