Q2 2024 One Stop Systems Inc Earnings Call Transcript
Key Points
- OSS reported sequential revenue growth of 4.3% and year-over-year segment revenue growth of 8.3%, excluding a former media customer.
- The company has a robust pipeline exceeding $1 billion, with 70% comprised of platform opportunities, indicating potential for multi-year revenue.
- Customer-funded development revenue increased significantly to $1.4 million in Q2 2024 from $365,000 in the previous quarter.
- OSS is expanding its product development efforts with five new products under development focused on edge computing for defense and commercial applications.
- The company is strategically investing in program management personnel with experience in large-scale defense programs, positioning OSS for future growth.
- Consolidated revenue declined by 23.3% year-over-year, primarily due to a $3.2 million reduction from a former media customer and a $1.3 million decline in Bressner revenue.
- Consolidated gross profit margin decreased to 25.2% from 27.9% due to underabsorption of production capacity and additional inventory reserves.
- OSS reported a GAAP net loss of $2.3 million and a non-GAAP net loss of $1.8 million for the second quarter of 2024.
- The company faces economic uncertainty and continued weakness in European markets, which may impact consolidated second-half performance.
- The government procurement process is experiencing delays, with contract awards taking longer than expected, impacting the timing of revenue recognition.
Good day, and. welcome to the One Stop Systems second-quarter 2024 conference call and webcast. (Operator Instructions) As a reminder, this conference is being recorded.
As part of the discussion today, the representatives of OSS will be making certain forward-looking statements regarding the company's future financial and operating results, as well as their business plans, objectives, and expectations. These statements are based on the company's current beliefs and expectations and should not be regarded, as a representation of OSS, that any of these plans or expectations will be achieved.
Please be advised that these forward-looking statements are covered under the Safe Harbor provision of the Private Securities Litigation Reform Act of 1995 and that OSS desires to avail itself to the protections of the Safe Harbor for these statements. Please also be advised that the actual results could differ materially from those stated or implied by the forward-looking statements due to certain risks and uncertainties, including those described in the company's most recent annual report from Form
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