TSS Q2 revenue falls 20% and misses analyst estimates

TSS

13/08/2026 21:14

Overview
US data center services firm's Q2 revenue fell 20%, missing analyst expectations
Company shifted focus to higher-margin systems integration, up 46%, and facilities management, up 84%
TSS began $17 mln investment in next-gen AI data center tech, aiming to boost future integration revenue

Outlook
TSS maintains 2026 Adjusted EBITDA outlook at upper end of $20 mln to $22 mln range
Company expects second half 2026 to be stronger than first half
TSS anticipates accelerated growth in systems integration revenue in H2 2026

Result Drivers
REVENUE MIX SHIFT - Co said lower total revenue reflects a move away from lower-margin procurement to higher-margin systems integration and facilities management
SYSTEMS INTEGRATION GROWTH - Systems integration revenue rose 46% and made up a greater share of total revenue, driven by demand for AI and high-performance computing infrastructure
FACILITIES MANAGEMENT INCREASE - Facilities management revenue grew 84% as part of the company's focus on higher-margin services

Company press release: ID:nACSWqRSka

Key Details
Metric
Beat/Miss
Actual
Consensus Estimate
Q2 Revenue
Miss
$35.14 mln
$47.10 mln (3 Analysts)
Q2 EPS
 
$0.05
 
Q2 Net Income
 
$1.43 mln
 
Q2 Basic EPS
 
$0.05
 

Analyst Coverage
The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 3 "strong buy" or "buy", no "hold" and no "sell" or "strong sell"
Wall Street's median 12-month price target for TSS Inc is $16.00, about 32.1% above its August 12 closing price of $12.11
The stock recently traded at 42 times the next 12-month earnings vs. a P/E of 57 three months ago

Reuters Recommended Reads
Aug 12 - Datacentrex Q2 net loss widens as gross margin fell sharply
Aug 10 - Riot Platforms Q2 revenue beats on data center contracts
Aug 13 - India's Black Box secures $131 mln data centre order from U.S. hyperscaler

For questions concerning the data in this report, contact Estimates.Support@lseg.com. For any other questions or feedback, contact reuters.support@thomsonreuters.com.

(This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)