The following is a summary of the One Stop Systems, Inc. (OSS) Q2 2024 Earnings Call Transcript:

Financial Performance:

• OSS reported a consolidated revenue of $13.2 million, exceeding the guidance of $13 million, despite a 23.3% year-over-year decline largely due to reductions in revenue from a former media customer and decreased Bressner revenue in Europe.

• Gross profit margin fell to 25.2% from 27.9% the previous year, attributed to under-absorption in the OSS segment and additional inventory reserves.

• The company reported a GAAP net loss of $2.3 million or $0.11 per share, and a non-GAAP net loss of $1.8 million or $0.09 per share.

• Adjusted EBITDA was a loss of $1.3 million compared to a positive $520,000 in the same quarter of the prior year.

Business Progress:

• OSS is focusing on converting a significant pipeline into orders, primarily in the defense segment, with a pipeline end value over $1 billion.

• Customer-funded development projects increased revenue to $1.4 million, from $365,000 in the prior quarter, signaling growth in integrating solutions and establishing OSS as a platform incumbent for future multi-year contracts.

• Ongoing product development efforts in edge computing for defense and commercial applications are expected to result in new product announcements and demonstrations in the near future.

• Strategic personnel additions have been made to augment the team's capabilities in managing large-scale defense and commercial programs.

Opportunities:

• Strong pipeline and customer-funded development programs indicate potential for large-scale multiyear contracts, particularly in defense and commercial markets.

• Strategic investment in product development and personnel indicates a commitment to capturing future market opportunities in edge computing and rugged enterprise-class compute solutions.

Risks:

• Continued economic uncertainty and weakness in the European market could potentially impact performance negatively, as indicated by lower Bressner revenue and overall soft market conditions in Europe.

More details: One Stop Systems IR

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