By Kelly Cloonan

Shares of TSS climbed after the company gave an optimistic outlook for the full-year and logged an over six-fold increase in revenue in the first quarter.

The stock rose 41% to $12.49 in after-hours trading. Shares have risen by almost seven-fold over the past 12 months through Thursday's market close.

The data center services company said it expects revenue growth in its AI rack integration services segment to accelerate beginning in the second quarter after starting production at a new facility last week.

The facility remains on track to be fully operational across all capabilities in June, and at full capacity, will enable the company to integrate several times the number of data center racks at its current facility, Chief Executive Darryll Dewan said.

TSS expects production volumes to grow in the second quarter and continue to ramp throughout the remainder of the year and into 2026, Dewan said.

The company continues to expect total revenue in the first half of 2025 to exceed total revenue in the second half of last year, he said.

"In light of the demanding and rapidly advancing AI computing environment, our new facility is a strong differentiator," he said.

For the first quarter, the company posted a profit of $3 million, or 12 cents a share, compared with $15,000, or 0 cents a share, a year earlier.

Revenue rose by over six-fold to $99 million.

Write to Kelly Cloonan at kelly.cloonan@wsj.com

(END) Dow Jones Newswires

May 15, 2025 18:09 ET (22:09 GMT)

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