One Stop Systems, Inc 8-K, filed Oct 28, 2026
One Stop Systems, Inc. (OSS)
About this 8-K
One Stop Systems, Inc filed this 8-K on October 28, 2026.
One Stop Systems reported third-quarter continuing-operations revenue of $12.6 million, up 35.9%, and adjusted EBITDA of $0.3 million. It raised 2026 revenue growth guidance to approximately 40% from 25% to 30%, while nine-month operating cash use was $12.4 million. AI summary
Items reported
- Item 2.02: Financial results
- Item 7.01: Regulation FD disclosure
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of Earliest Event Reported):
(Exact name of Registrant as specified in its charter)
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(State or Other Jurisdiction of Incorporation) |
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(Commission File Number) |
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(IRS Employer Identification No.) |
(Address of Principal Executive Offices)
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(Registrant’s Telephone Number, including area code)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2 below):
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Securities registered pursuant to Section 12(b) of the Act:
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Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933(§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Item 2.02 Results of Operations and Financial Condition
The information provided below in “Item 7.01 - Regulation FD Disclosure” of this Current Report on Form 8-K is incorporated by reference into this Item 2.02.
Item 7.01 Regulation FD Disclosure
On October 28, 2026, One Stop Systems, Inc. (the “Company”) issued a press release regarding the Company’s financial results for its third fiscal quarter ended September 30, 2026. A copy of that press release is furnished as Exhibit 99.1 hereto and incorporated herein by reference.
Exhibit 99.1 includes non-GAAP financial measures as defined in Regulation G. Exhibit 99.1 also includes a presentation of the most directly comparable financial measures calculated and presented in accordance with accounting principles generally accepted in the United States (“GAAP”), information reconciling the non-GAAP financial measures to the GAAP financial measures and a discussion of the reasons why the Company’s management believes that presentation of the non-GAAP financial measures provides useful information to investors regarding the Company’s financial condition and results of operations. The non-GAAP financial measures presented therein should be considered in addition to, not as a substitute for, or superior to, financial measures calculated and presented in accordance with GAAP.
Exhibit 99.1 also contains forward-looking statements. These forward-looking statements are not guarantees of future performance and involve risks, uncertainties and assumptions that are difficult to predict. Forward-looking statements are based upon assumptions as to future events that may not prove to be accurate. Actual outcomes and results may differ materially from what is expressed in these forward-looking statements.
The information set forth under Item 7.01 of this Current Report on Form 8-K (“Current Report”), including Exhibit 99.1 attached hereto, is being furnished and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of such section. The information in Item 7.01 of this Current Report, including Exhibit 99.1, shall not be incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Exchange Act, regardless of any incorporation by reference language in any such filing, except as expressly set forth by specific reference in such a filing. This Current Report will not be deemed an admission as to the materiality of any information in this Current Report that is required to be disclosed solely by Regulation FD.
Item 9.01 |
Financial Statements and Exhibits. |
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(d) |
Exhibits. |
Exhibit No. |
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Description |
99.1 |
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104 |
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Cover Page Interactive Data File (formatted in Inline XBRL and contained in Exhibit 101) |
- 2 -
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
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ONE STOP SYSTEMS, INC. |
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Dated: October 28, 2026 |
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By: |
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/s/ Dan Gabel |
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Dan Gabel |
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Chief Financial Officer |
- 3 -
Exhibit 99.1
One Stop Systems Reports Q3 2026 Results
Year-over-year revenue growth for the third quarter of 35.9% driven primarily by expanding commercial customer base across healthcare, aerospace and data center markets
Year-to-date book-to-bill of 1.46x reflects strong demand and robust pipeline
across defense and commercial markets
Management increases revenue growth guidance to approximately 40% for 2026, from its prior guidance of 25% to 30%, as a result of stronger than expected third quarter sales and orders
ESCONDIDO, Calif. – October 28, 2026 – One Stop Systems, Inc. ("OSS" or the "Company") (Nasdaq: OSS), a leader in rugged Enterprise Class compute for artificial intelligence (AI), machine learning (ML), autonomy and sensor processing at the edge, reported results for the third quarter ended September 30, 2026. Third quarter and nine-month comparisons are to the same year-ago periods unless otherwise noted. On December 30, 2025, the Company closed a definitive agreement to sell all assets and operations of Bressner Technology GmbH. All operations, assets, and liabilities associated with the sale of Bressner have been classified as discontinued operations.
“Our third quarter results were better than expected and reflect accelerating momentum across our business, supported by growing demand for our Enterprise Class compute solutions and the expanding diversity of our customer base,” stated OSS President and CEO, Mike Knowles. “We are particularly encouraged by the composition of our third quarter revenue growth, which was primarily driven by higher sales to commercial customers across healthcare, commercial aerospace, and specialized data center applications, complementing our established strength and continued momentum in defense markets. Expanding customer diversification, combined with higher average order values, reflects growing demand for our differentiated compute solutions across multiple end markets.”
“Our pipeline remains robust, with a year-to-date book-to-bill ratio of 1.46x reflecting strong underlying demand for our solutions. While third quarter bookings were influenced by the timing of customer orders, we expect several large, multimillion-dollar orders to close during the fourth quarter and continue to advance what we believe to be potentially transformative opportunities across our core defense and commercial markets. We believe these opportunities reflect our strengthening competitive position and provide a solid foundation for sustained growth,” continued Mr. Knowles.
“Third quarter adjusted EBITDA increased 33.7% year-over-year to $0.3 million. In the quarter, we recognized $0.5 million of bad debt expense related to the bankruptcy filing of a former customer and $0.4 million of legal expenses related to a previously disclosed settlement with a former customer. Excluding these two items, third quarter adjusted EBITDA would have been approximately $1.2 million, or nearly 10% of third quarter total revenue, demonstrating the underlying profitability and operating leverage of our business. We are excited about the opportunities ahead in the fourth quarter and as we enter 2027, and remain confident in our ability to drive sustainable, profitable growth and long-term shareholder value,” concluded Mr. Knowles.
2026 Third-Quarter Financial Summary
Total revenue from continuing operations increased to $12.6 million, from $9.3 million in the third quarter of 2025. The 35.9% year-over-year increase in total revenue was driven by revenue generated from new customers in 2026 and from higher production volumes with certain existing customers. Key drivers of the revenue increase included initial deliveries to a new customer developing a network of autonomous energy nodes engineered to power compute payloads, higher production deliveries to a commercial aerospace customer for in-flight entertainment systems, and higher sales to a medical imaging OEM to support a breast cancer screening application.
Gross margin from continuing operations was 42.6% for the three months ended September 30, 2026, compared to 45.6% in the prior year quarter. The year-over-year decrease in gross margin percentage was primarily driven by product mix, partially offset by more favorable manufacturing absorption.
Total operating expenses from continuing operations increased 33.7% to $6.2 million. The $1.6 million year-over-year increase in operating expenses was primarily due to $0.5 million of bad debt expense recognized for a receivable with a former customer that entered bankruptcy, $0.4 million of legal fees associated with a previously disclosed legal settlement with a former customer, and $0.5 million of higher stock-based compensation expense due to a higher grant date fair value of RSUs expensed in the current year period. Total operating expenses were partially offset by lower year-over-year R&D expenses.
The Company reported a loss from continuing operations of $0.6 million, or $0.02 per diluted share for the three months ended September 30, 2026, as compared to a loss from continuing operations of $0.4 million, or $0.02 per share, in the prior year period. The Company reported non-GAAP net income from continuing operations of $0.3 million, or $0.01 per diluted share, compared to non-GAAP net income of $31,000, or $0.00 per share, in the prior year period.
Adjusted EBITDA, from continuing operations, a non-GAAP metric, was $0.3 million for the three months ended September 30, 2026, compared to adjusted EBITDA, from continuing operations, of $0.2 million in the prior year period. Adjusted EBITDA for the third quarter of 2026 included expenses of $0.5 million for a bad debt expense and $0.4 million of legal fees associated with the previously disclosed legal settlement with a former customer. 2026 third quarter adjusted EBITDA excluding these expenses would have been $1.2 million.
Net cash used in continuing operations for the nine months ended September 30, 2026, was $12.4 million, compared to net cash used in continuing operations of $5.9 million in the prior year period. 2026 year-to-date net cash included a $6.25 million legal settlement that occurred in the 2026 second quarter, and a year-to-date increase of $7.8 million in inventories to support expected revenue growth.
As of September 30, 2026, the Company reported cash, cash equivalents, and short-term investments of $18.9 million, and total working capital of $37.9 million, compared to cash, cash equivalents, and short-term investments of $31.2 million, restricted cash of $2.2 million and total working capital of $45.3 million at December 31, 2025.
2
2026 Nine Month Financial Summary
Total revenue from continuing operations increased to $30.0 million, compared to $20.2 million for the same period last year. The 48.3% year-over-year increase in total revenue was driven by revenue generated from new customers in 2026 and from higher production volume with certain existing customers. Key drivers of the revenue increase included higher sales to support the P-8A Poseidon reconnaissance aircraft, higher sales to a medical imaging OEM to support a breast cancer screening application, higher sales for military applications onboard naval vessels and aircraft, initial deliveries to a new customer developing a network of autonomous energy nodes, and higher revenue from customer-funded development programs.
Gross margin from continuing operations was 43.9%, as compared to 44.4% in the prior year. The slight year-over-year decrease in gross margin percentage was primarily driven by product mix, partially offset by more favorable manufacturing absorption and higher engineering efficiencies on customer funded development programs.
Total operating expenses increased 56.5% to $22.4 million, from $14.3 million for the same period last year. The $8.0 million year-over-year increase in operating expenses included a $6.25 million charge related to the legal settlement in the second quarter, as well as a $0.5 million of bad debt expense, primarily driven by provision for a receivable with a former customer that entered bankruptcy, $0.7 million of legal fees associated with a previously disclosed legal settlement with a former customer, and $0.9 million of higher stock-based compensation expense due to a higher grant date fair value of RSUs expensed in the current year period. Total operating expenses were partially offset by lower year-over-year R&D expenses.
OSS reported a loss from continuing operations of $8.3 million, or $0.33 per share, as compared to a loss from continuing operations of $5.1 million, or $0.24 per share, in the prior year. The Company reported non-GAAP net income from continuing operations of $0.4 million, or $0.02 per share, compared to a non-GAAP net loss from continuing operations of $3.7 million, or $0.17 per share in the prior year.
Adjusted EBITDA income, from continuing operations, a non-GAAP metric, was $0.1 million, compared to an adjusted EBITDA loss, from continuing operations, of $3.2 million in the prior year period. Adjusted EBITDA for the first nine-months of 2026 included $0.5 million for a bad debt expense associated with the bankruptcy of a former customer and $0.7 million of legal fees associated with the previously-disclosed legal settlement with a former customer. 2026 year-to-date adjusted EBITDA excluding these expenses would have been $1.4 million.
Income from Discontinued Operations, net of Income Taxes
Income from discontinued operations consists of income from the Company’s Bressner Technologies subsidiary, which was sold on December 30, 2025. Income from discontinued operations also includes the gain recognized on the sale.
The Company recorded no income or loss from discontinued operations, net of income taxes, for the three months ended September 30, 2026, compared to income of $0.6 million in the prior year. For the nine months ended September 30, 2026, loss from discontinued operations, net of income taxes, was $0.2 million, compared to income from discontinued operations, net of income taxes, of $1.4 million in the prior year. The loss in the current year period was due to post-transaction adjustments to the gain on sale of the Bressner business for final net working capital balances.
3
2026 Full Year Outlook
The Company is executing a strategic plan targeting both commercial and defense markets, aiming to provide integrated solutions and establish OSS as a platform incumbent on large, multi-year programs. This approach is expected to drive long-term value by increasing predictable, recurring revenue and building a strong, multi-year backlog.
Based on its current performance and business outlook, OSS is increasing its full-year 2026 revenue growth guidance. We believe that the Company’s expectations for 2026 reflect better than expected growth across its core defense and commercial markets and expected higher customer-funded development revenue compared with 2025. The Company also continues to monitor potential supply chain constraints affecting certain components, including memory, and the current outlook for the federal government budget. Changes in these assumptions could positively or negatively affect OSS’s 2026 results.
For the full year of 2026, OSS expects:
Conference Call
OSS will hold a conference call to discuss its results for the third quarter of 2026, followed by a question-and-answer period.
Date: Wednesday, October 28, 2026
Time: 10:00 a.m. ET (7:00 a.m. PT)
Toll-free dial-in: 1-800-717-1738
International dial-in: 1-646-307-1865
Conference ID: 32264 (required for entry)
Webcast: https://viavid.webcasts.com/starthere.jsp?ei=1773205&tp_key=3a8ee0805b
A replay of the call will be available after 1:00 p.m. ET on October 28, 2026, through November 11, 2026.
Toll-free replay: 1-844-512-2921
International replay: 1-412-317-6671
Passcode: 1132264
About One Stop Systems
One Stop Systems, Inc. (Nasdaq: OSS) is a leader in AI enabled solutions for the demanding ‘edge.’ OSS designs and manufactures Enterprise Class compute and storage products that enable rugged AI, sensor fusion and autonomous capabilities without compromise. These hardware and software platforms bring the latest data center performance to harsh and challenging applications, whether they are on land, sea or in the air.
OSS products include ruggedized servers, compute accelerators, flash storage arrays, and storage acceleration software. These specialized compact products are used across multiple industries and
4
applications, including autonomous trucking and farming, as well as aircraft, drones, ships and vehicles within the defense industry.
OSS solutions address the entire AI workflow, from high-speed data acquisition to deep learning, training and large-scale inference, and have delivered many industry firsts for industrial OEM and government customers.
As one of the fastest growing segments of the multi-billion-dollar edge computing market, AI enabled solutions require—and OSS delivers—the highest level of performance in the most challenging environments without compromise.
OSS products are available directly or through global distributors. For more information, go to www.onestopsystems.com. You can also follow OSS on X, YouTube, and LinkedIn.
Non-GAAP Financial Measures
We believe that the use of adjusted earnings before interest, taxes, depreciation and amortization, or adjusted EBITDA, is helpful for an investor to assess the performance of the Company. The Company defines adjusted EBITDA as income (loss) before interest, taxes, depreciation, amortization, acquisition expense, impairment of long-lived assets, financing costs, government funded programs, fair value adjustments from purchase accounting, stock-based compensation expense, and expenses related to discontinued operations. Adjusted EBITDA also excludes the impact of the legal settlement agreement.
Adjusted EBITDA is not a measurement of financial performance under generally accepted accounting principles in the United States, or GAAP. Because of varying available valuation methodologies, subjective assumptions and the variety of equity instruments that can impact a company’s non-cash operating expenses, we believe that providing a non-GAAP financial measure that excludes non-cash and non-recurring expenses allows for meaningful comparisons between our core business operating results and those of other companies, as well as providing us with an important tool for financial and operational decision making and for evaluating our own core business operating results over different periods of time.
Our adjusted EBITDA measure may not provide information that is directly comparable to that provided by other companies in our industry, as other companies in our industry may calculate non-GAAP financial results differently, particularly related to non-recurring and unusual items. Our adjusted EBITDA is not a measurement of financial performance under GAAP and should not be considered as an alternative to operating income or as an indication of operating performance or any other measure of performance derived in accordance with GAAP. We do not consider adjusted EBITDA to be a substitute for, or superior to, the information provided by GAAP financial results.
5
EBITDA from Continuing Operations
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For the Three Months Ended September 30, |
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For the Nine Months Ended September 30, |
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2026 |
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2025 |
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2026 |
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2025 |
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Loss from continuing operations |
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$ |
(593,734 |
) |
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$ |
(380,719 |
) |
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$ |
(8,275,982 |
) |
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$ |
(5,134,263 |
) |
Legal settlement |
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$ |
- |
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$ |
- |
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6,250,000 |
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- |
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Depreciation |
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$ |
183,195 |
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$ |
192,841 |
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549,811 |
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583,278 |
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Amortization of right-of-use assets net of change in operating lease liability |
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$ |
(6,223 |
) |
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$ |
(2,595 |
) |
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(16,376 |
) |
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(6,660 |
) |
Stock-based compensation expense |
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$ |
909,622 |
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$ |
411,687 |
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2,425,963 |
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1,473,442 |
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Interest expense |
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$ |
- |
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$ |
2,424 |
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- |
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2,424 |
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Interest income |
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$ |
(242,570 |
) |
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$ |
(36,433 |
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(853,398 |
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(159,795 |
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Adjusted EBITDA |
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$ |
250,290 |
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$ |
187,205 |
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$ |
80,018 |
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$ |
(3,241,573 |
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EBITDA from Discontinued Operations
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For the Three Months Ended September 30, |
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For the Nine Months Ended September 30, |
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2026 |
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2025 |
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2026 |
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2025 |
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Income (loss) from discontinued operations, net of income taxes |
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$ |
- |
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$ |
644,206 |
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$ |
(157,274 |
) |
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$ |
1,359,387 |
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Post-closing adjustments to gain on sale |
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$ |
- |
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$ |
- |
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157,274 |
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- |
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Depreciation |
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$ |
- |
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$ |
32,927 |
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- |
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93,499 |
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Amortization of right-of-use assets net of change in operating lease liability |
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$ |
- |
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$ |
(113 |
) |
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53,796 |
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Stock-based compensation expense |
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$ |
- |
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$ |
32,934 |
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- |
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99,514 |
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Interest expense |
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$ |
- |
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$ |
12,641 |
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- |
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40,517 |
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Interest income |
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$ |
- |
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$ |
- |
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- |
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555 |
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Provision for income taxes |
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$ |
- |
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$ |
266,881 |
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- |
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600,535 |
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Adjusted EBITDA |
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$ |
- |
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$ |
989,476 |
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$ |
- |
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$ |
2,247,802 |
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Consolidated EBITDA
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For the Three Months Ended September 30, |
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For the Nine Months Ended September 30, |
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2026 |
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2025 |
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2026 |
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2025 |
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Net (loss) income |
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$ |
(593,734 |
) |
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$ |
263,488 |
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$ |
(8,433,256 |
) |
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$ |
(3,774,876 |
) |
Legal settlement |
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$ |
- |
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$ |
- |
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6,250,000 |
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|
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- |
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Post-closing adjustments to gain on sale |
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$ |
- |
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$ |
- |
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157,274 |
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- |
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Depreciation |
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$ |
183,195 |
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|
$ |
225,768 |
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549,811 |
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|
676,777 |
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Amortization of right-of-use assets net of change in operating lease liability |
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$ |
(6,223 |
) |
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$ |
(2,708 |
) |
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(16,376 |
) |
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47,136 |
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Stock-based compensation expense |
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$ |
909,622 |
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$ |
444,621 |
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2,425,963 |
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1,572,956 |
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Interest expense |
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$ |
- |
|
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$ |
15,065 |
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|
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- |
|
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42,941 |
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Interest income |
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$ |
(242,570 |
) |
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$ |
(36,433 |
) |
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(853,398 |
) |
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|
(159,240 |
) |
Provision for income taxes |
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$ |
- |
|
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$ |
266,881 |
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|
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- |
|
|
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600,535 |
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Adjusted EBITDA |
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$ |
250,290 |
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$ |
1,176,682 |
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$ |
80,018 |
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$ |
(993,771 |
) |
6
(Dollars may not calculate due to rounding)
Adjusted EPS excludes the impact of certain items and, therefore, has not been calculated in accordance with GAAP. We believe that exclusion of certain selected items assists in providing a more complete understanding of our underlying results and trends and allows for comparability with our peer company index and industry. We use this measure along with the corresponding GAAP financial measures to manage our business and to evaluate our performance compared to prior periods and the marketplace. The Company defines non-GAAP income (loss) as income or (loss) before amortization, government funded programs, impairment of long lived assets, stock-based compensation, expenses related to discontinued operations, and acquisition costs. Non-GAAP income (loss) also excludes the impact of the legal settlement agreement. Adjusted EPS expresses adjusted income (loss) on a per share basis using weighted average diluted shares outstanding.
Adjusted EPS is a non-GAAP financial measure and should not be considered in isolation or as a substitute for financial information provided in accordance with GAAP. These non-GAAP financial measures may not be computed in the same manner as similarly titled measures used by other companies. We expect to continue to incur expenses similar to the adjusted income from continuing operations and adjusted EPS financial adjustments described above, and investors should not infer from our presentation of these non-GAAP financial measures that these costs are unusual, infrequent or non-recurring.
The following table reconciles non-GAAP net income and basic and diluted earnings per share:
Non-GAAP Adjusted EPS from Continuing Operations
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For the Three Months Ended September 30, |
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For the Nine Months Ended September 30, |
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2026 |
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2025 |
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2026 |
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2025 |
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Loss from continuing operations |
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$ |
(593,734) |
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$ |
(380,719) |
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$ |
(8,275,982 |
) |
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$ |
(5,134,263 |
) |
Legal settlement |
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- |
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- |
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6,250,000 |
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|
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- |
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Stock-based compensation expense |
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909,622 |
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411,687 |
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2,425,963 |
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1,473,442 |
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Non-GAAP net income (loss) from continuing operations |
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$ |
315,888 |
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$ |
30,968 |
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$ |
399,981 |
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$ |
(3,660,821 |
) |
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Non-GAAP net income (loss) from continuing operations per share: |
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Basic |
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$ |
0.01 |
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|
$ |
0.00 |
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|
$ |
0.02 |
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|
$ |
(0.17 |
) |
Diluted |
|
$ |
0.01 |
|
|
$ |
0.00 |
|
|
$ |
0.02 |
|
|
$ |
(0.17 |
) |
Weighted average common shares outstanding: |
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Basic |
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24,993,832 |
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21,952,963 |
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|
|
24,839,830 |
|
|
|
21,675,802 |
|
Diluted |
|
|
25,899,044 |
|
|
|
22,840,761 |
|
|
|
25,933,329 |
|
|
|
21,675,802 |
|
7
Non-GAAP Adjusted EPS from Discontinued Operations
|
|
For the Three Months Ended September 30, |
|
|
For the Nine Months Ended September 30, |
|
||||||||||
|
|
2026 |
|
|
2025 |
|
|
2026 |
|
|
2025 |
|
||||
Income (loss) from discontinued operations, net of income taxes |
|
$ |
- |
|
|
$ |
644,206 |
|
|
$ |
(157,274 |
) |
|
$ |
1,359,387 |
|
Post-closing adjustments to gain on sale |
|
|
- |
|
|
|
- |
|
|
|
157,274 |
|
|
|
- |
|
Stock-based compensation expense |
|
|
- |
|
|
|
32,934 |
|
|
|
- |
|
|
|
99,514 |
|
Non-GAAP net income from discontinued operations |
|
$ |
- |
|
|
$ |
677,140 |
|
|
$ |
- |
|
|
$ |
1,458,901 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP net income from discontinued operations per share: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
$ |
- |
|
|
$ |
0.03 |
|
|
$ |
- |
|
|
$ |
0.07 |
|
Diluted |
|
$ |
- |
|
|
$ |
0.03 |
|
|
$ |
- |
|
|
$ |
0.07 |
|
Weighted average common shares outstanding: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
|
24,993,832 |
|
|
|
21,952,963 |
|
|
|
24.839,830 |
|
|
|
21,675,802 |
|
Diluted |
|
|
25,899,044 |
|
|
|
22,840,761 |
|
|
|
25,933,329 |
|
|
|
22,308,957 |
|
Consolidated Non-GAAP Adjusted EPS
|
|
For the Three Months Ended September 30, |
|
|
For the Nine Months Ended September 30, |
|
||||||||||
|
|
2026 |
|
|
2025 |
|
|
2026 |
|
|
2025 |
|
||||
Net (loss) income |
|
$ |
(593,734 |
) |
|
$ |
263,488 |
|
|
$ |
(8,433,256 |
) |
|
$ |
(3,774,876 |
) |
Legal settlement |
|
|
- |
|
|
|
- |
|
|
|
6,250,000 |
|
|
|
- |
|
Post-closing adjustments to gain on sale |
|
|
- |
|
|
|
- |
|
|
|
157,274 |
|
|
|
- |
|
Stock-based compensation expense |
|
|
909,622 |
|
|
|
|
|
|
|
2,425,963 |
|
|
|
1,572,956 |
|
Non-GAAP net income (loss) |
|
$ |
315,888 |
|
|
$ |
708,109 |
|
|
$ |
399,981 |
|
|
$ |
(2,201,920 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP net income (loss) per share: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
$ |
0.01 |
|
|
$ |
0.03 |
|
|
$ |
0.02 |
|
|
$ |
(0.10 |
) |
Diluted |
|
$ |
0.01 |
|
|
$ |
0.03 |
|
|
$ |
0.02 |
|
|
$ |
(0.10 |
) |
Weighted average common shares outstanding: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
|
24,993,832 |
|
|
|
21,952,963 |
|
|
|
24.839,830 |
|
|
|
21,675,802 |
|
Diluted |
|
|
25,899,044 |
|
|
|
22,840,761 |
|
|
|
25,933,329 |
|
|
|
21,675,802 |
|
(Dollars may not calculate due to rounding)
Forward-Looking Statements
One Stop Systems cautions you that statements in this press release that are not a description of historical facts are forward-looking statements. Words such as, but not limited to, "anticipate," "aim," "believe," "contemplate," "continue," "could," "design," "estimate," "expect," "intend," "may," "might," "plan," "possible," "potential," "predict," "project," "seek," "should," "suggest," "strategy," "target," "will," "would," and similar expressions or phrases, or the negative of those expressions or phrases, are intended to identify forward-looking statements, although not all forward-looking statements contain these identifying words. These statements include but are not limited to statements regarding the Company's anticipated financial performance and outlook for 2026, including expected revenue growth, gross margin and adjusted EBITDA; anticipated customer orders and the timing and likelihood of converting sales opportunities into bookings and revenue; expected demand for the Company's products across defense and commercial markets; anticipated customer-funded development activity; the Company's ability to expand its customer base and market opportunities; and its ability to execute
8
its strategic plan, secure positions on large, multi-year programs and achieve sustainable growth and profitability.
The inclusion of forward-looking statements should not be regarded as a representation by One Stop Systems or its partners that any of its plans or expectations will be achieved, including but not limited to expected increases in sales, revenues and profitability, non-GAAP financial measures, our multi-year strategy, expected market growth, continued or new demand for our products, increase in margins, and operating expenses. These statements are based on the Company's current beliefs and expectations. Actual results may differ from those set forth in this press release due to the risk and uncertainties inherent in our business, including risks described in our prior press releases and in our filings with the Securities and Exchange Commission (SEC), including under the heading "Risk Factors" in our latest Annual Report on Form 10-K and any subsequent filings with the SEC, as well as those relating to current geopolitical conditions, defense spending changes, the Company’s ability to successfully scale production, manage program execution, and meet customer delivery schedules, semiconductor supply constraints, and customer concentration. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof, and the Company undertakes no obligation to revise or update this press release to reflect events or circumstances after the date hereof. All forward-looking statements are qualified in their entirety by this cautionary statement, which is made under the safe harbor provisions of the Private Securities Litigation Reform Act of 1995.
Media Contacts:
Robert Kalebaugh
One Stop Systems, Inc.
Tel (858) 518-6154
Email contact
Investor Relations:
Andrew Berger
Managing Director
SM Berger & Company, Inc.
Tel (216) 464-6400
Email contact
9
ONE STOP SYSTEMS, INC. (OSS)
CONSOLIDATED BALANCE SHEETS
|
|
Unaudited September 30, 2026 |
|
|
Audited December 31, 2025 |
|
||
ASSETS |
|
|
|
|
|
|
|
|
Current assets |
|
|
|
|
|
|
|
|
Cash and cash equivalents |
|
$ |
5,637,841 |
|
|
$ |
31,174,880 |
|
Restricted cash |
|
|
- |
|
|
|
2,200,096 |
|
Short-term investments |
|
|
13,246,688 |
|
|
|
- |
|
Accounts receivable, net |
|
|
12,743,025 |
|
|
|
11,549,718 |
|
Inventories, net |
|
|
13,724,600 |
|
|
|
5,420,439 |
|
Prepaid expenses and other current assets |
|
|
567,705 |
|
|
|
472,884 |
|
Total current |
|
|
45,919,865 |
|
|
|
50,818,017 |
|
Property and equipment, net |
|
|
292,229 |
|
|
|
674,654 |
|
Operating lease right-of-use assets |
|
|
1,086,582 |
|
|
|
1,216,871 |
|
Deposits and other |
|
|
36,555 |
|
|
|
38,093 |
|
Intangible assets, net |
|
|
85,695 |
|
|
|
73,908 |
|
Total assets |
|
$ |
47,420,926 |
|
|
$ |
52,821,543 |
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND STOCK HOLDER |
|
|
|
|
|
|
|
|
Current liabilities |
|
|
|
|
|
|
|
|
Accounts payable |
|
$ |
2,114,154 |
|
|
|
1,716,389 |
|
Accrued expenses and other current liabilities |
|
|
5,679,614 |
|
|
|
3,630,130 |
|
Current portion of operating lease liabilities |
|
|
267,693 |
|
|
|
219,097 |
|
Total current liabilities |
|
|
8,061,461 |
|
|
|
5,565,616 |
|
Operating lease liabilities, net of current portion |
|
|
1,054,602 |
|
|
|
1,249,862 |
|
Total liabilities |
|
|
9,116,063 |
|
|
|
6,815,478 |
|
Commitments and contingencies |
|
|
|
|
|
|
|
|
Stockholders' equity |
|
|
|
|
|
|
|
|
Common stock, $0.0001 par value; 500,000,000 shares authorized; 25,037,445 and 24,583,775 shares issued and outstanding at September 30, 2026 and December 31, 2025, respectively |
|
|
2,505 |
|
|
|
2,458 |
|
Additional paid-in capital |
|
|
63,751,064 |
|
|
|
62,968,973 |
|
Accumulated other comprehensive loss |
|
|
(50,884 |
) |
|
|
- |
|
Accumulated deficit |
|
|
(25,398,622 |
) |
|
|
(16,965,367 |
) |
Total stockholders’ equity |
|
|
38,304,863 |
|
|
|
46,006,064 |
|
Total liabilities and stockholders’ equity |
|
$ |
47,420,926 |
|
|
$ |
52,821,543 |
|
10
ONE STOP SYSTEMS, INC. (OSS)
UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS
(Dollars may not calculate due to rounding)
|
|
For the Three Month Ended September 30, |
|
|
For the Nine Months Ended September 30, |
|
||||||||||
|
|
|
2026 |
|
|
|
2025 |
|
|
2026 |
|
|
2025 |
|
||
Revenue: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Product |
|
$ |
12,353,277 |
|
|
$ |
8,966,978 |
|
|
$ |
27,822,538 |
|
|
$ |
19,139,122 |
|
Customer funded development |
|
|
230,241 |
|
|
|
295,539 |
|
|
|
2,179,141 |
|
|
|
1,090,916 |
|
|
|
|
12,583,518 |
|
|
|
9,262,517 |
|
|
|
30,001,679 |
|
|
|
20,230,038 |
|
Cost of Revenue: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Product |
|
|
7,135,004 |
|
|
|
4,944,908 |
|
|
|
15,765,085 |
|
|
|
10,560,688 |
|
Customer funded development |
|
|
90,355 |
|
|
|
95,919 |
|
|
|
1,059,839 |
|
|
|
696,579 |
|
|
|
|
7,225,359 |
|
|
|
5,040,827 |
|
|
|
16,824,924 |
|
|
|
11,257,267 |
|
Gross Profit |
|
|
5,358,159 |
|
|
|
4,221,690 |
|
|
|
13,176,755 |
|
|
|
8,972,771 |
|
Operating expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
General and administrative |
|
|
3,190,639 |
|
|
|
1,728,012 |
|
|
|
8,089,248 |
|
|
|
5,543,820 |
|
Legal settlement |
|
|
- |
|
|
|
- |
|
|
|
6,250,000 |
|
|
|
- |
|
Marketing and selling |
|
|
1,892,397 |
|
|
|
1,632,506 |
|
|
|
5,235,314 |
|
|
|
4,898,135 |
|
Research and development |
|
|
1,109,833 |
|
|
|
1,271,637 |
|
|
|
2,779,972 |
|
|
|
3,838,849 |
|
Total operating expenses |
|
|
6,192,869 |
|
|
|
4,632,155 |
|
|
|
22,354,534 |
|
|
|
14,280,804 |
|
Loss from operations |
|
|
(834,710 |
) |
|
|
(410,465 |
) |
|
|
(9,177,779 |
) |
|
|
(5,308,034 |
) |
Other income (expense), net: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Interest income |
|
|
242,570 |
|
|
|
36,433 |
|
|
|
853,398 |
|
|
|
159,795 |
|
Interest expense |
|
|
- |
|
|
|
(2,424 |
) |
|
|
- |
|
|
|
(2,424 |
) |
Other (expense) income, net |
|
|
(1,594 |
) |
|
|
(4,263 |
) |
|
|
48,399 |
|
|
|
16,400 |
|
Total other income, net |
|
|
240,976 |
|
|
|
29,746 |
|
|
|
901,797 |
|
|
|
173,771 |
|
Loss Before Income Taxes |
|
|
(593,734 |
) |
|
|
(380,719 |
) |
|
|
(8,275,982 |
) |
|
|
(5,134,263 |
) |
Provision for income taxes |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
Loss from continuing operations |
|
|
(593,734 |
) |
|
|
(380,719 |
) |
|
|
(8,275,982 |
) |
|
|
(5,134,263 |
) |
Income (loss) from discontinued operations, net of income taxes |
|
|
- |
|
|
|
644,206 |
|
|
|
(157,274 |
) |
|
|
1,359,387 |
|
Net (Loss) Income |
|
|
(593,734 |
) |
|
|
263,487 |
|
|
|
(8,433,256 |
) |
|
|
(3,774,876 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Per Share Basis: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Basis: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Continuing operations |
|
$ |
(0.02 |
) |
|
$ |
(0.02 |
) |
|
$ |
(0.33 |
) |
|
$ |
(0.24 |
) |
Discontinued operations |
|
$ |
- |
|
|
$ |
0.03 |
|
|
$ |
(0.01 |
) |
|
$ |
0.06 |
|
Basic (loss) income per share |
|
$ |
(0.02 |
) |
|
$ |
0.01 |
|
|
$ |
(0.34 |
) |
|
$ |
(0.17 |
) |
Diluted: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Continuing operations |
|
$ |
(0.02 |
) |
|
$ |
(0.02 |
) |
|
$ |
(0.33 |
) |
|
$ |
(0.24 |
) |
Discontinued operations |
|
$ |
- |
|
|
$ |
0.03 |
|
|
$ |
(0.01 |
) |
|
$ |
0.06 |
|
Diluted (Loss) Income per Share |
|
$ |
(0.02 |
) |
|
$ |
0.01 |
|
|
$ |
(0.34 |
) |
|
$ |
(0.17 |
) |
Weighted average common Shares outstanding: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Basic |
|
|
24,993,832 |
|
|
|
21,952,963 |
|
|
|
24,839,830 |
|
|
|
21,675,802 |
|
Diluted |
|
|
24,993,832 |
|
|
|
22,840,761 |
|
|
|
24,839,830 |
|
|
|
22,308,957 |
|
11
ONE STOP SYSTEMS, INC. (OSS)
UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS
|
|
For the Nine Months Ended September 30, |
|
|||||
|
|
2026 |
|
|
2025 |
|
||
Cash flows from continuing operating activities: |
|
|
|
|
|
|
|
|
Loss from continuing operations |
|
$ |
(8,275,982 |
) |
|
$ |
(5,134,263 |
) |
Adjustments to reconcile loss from continuing operations to net cash (used in) continuing operating activities: |
|
|
|
|
|
|
|
|
Depreciation |
|
|
549,811 |
|
|
|
583,278 |
|
Provision for (recovery from) credit losses |
|
|
573,596 |
|
|
|
(100 |
) |
Amortization of right-of-use assets |
|
|
130,289 |
|
|
|
169,723 |
|
Stock-based compensation expense |
|
|
2,425,963 |
|
|
|
1,473,442 |
|
Change in warranty reserves |
|
|
20,000 |
|
|
|
30,000 |
|
Change in inventories reserves |
|
|
(548,999 |
) |
|
|
(632,783 |
) |
Loss on disposal of property and equipment |
|
|
11,698 |
|
|
|
|
|
Changes in operating assets and liabilities: |
|
|
|
|
|
|
|
|
Accounts receivable |
|
|
(1,766,903 |
) |
|
|
(2,696,476 |
) |
Inventories |
|
|
(7,755,167 |
) |
|
|
671,968 |
|
Prepaid expenses and other current assets |
|
|
(96,301 |
) |
|
|
(135,855 |
) |
Security deposits |
|
|
3,019 |
|
|
|
- |
|
Accounts payable |
|
|
397,765 |
|
|
|
1,060,189 |
|
Accrued expenses and other current liabilities |
|
|
2,029,484 |
|
|
|
(1,152,416 |
) |
Operating lease liabilities |
|
|
(146,665 |
) |
|
|
(176,383 |
) |
Net cash used in continuing operating activities |
|
|
(12,448,392 |
) |
|
|
(5,939,676 |
) |
|
|
|
|
|
|
|
|
|
Cash flows from continuing investing activities: |
|
|
|
|
|
|
|
|
Purchases of property and equipment |
|
|
(190,872 |
) |
|
|
(108,630 |
) |
(Purchase) sale of marketable securities |
|
|
(13,296,773 |
) |
|
|
3,212,492 |
|
Net cash (used in) provided by continuing investing activities |
|
|
(13,487,645 |
) |
|
|
3,103,862 |
|
|
|
|
|
|
|
|
|
|
Cash flows from continuing financing activities: |
|
|
|
|
|
|
|
|
Proceeds from exercise of stock options |
|
|
206,122 |
|
|
|
1,022,988 |
|
Payment of withholding taxes on stock-based awards |
|
|
(1,849,946 |
) |
|
|
(509,977 |
) |
Proceeds from bank lines of credit |
|
|
- |
|
|
|
1,000,000 |
|
Net cash (used in) provided by continuing financing financing activities |
|
|
(1,643,824 |
) |
|
|
1,513,011 |
|
|
|
|
|
|
|
|
|
|
Net change in cash, cash equivalents, and restricted cash from continuing operations |
|
|
(27,579,861 |
) |
|
|
(1,322,803 |
) |
|
|
|
|
|
|
|
|
|
Net cash flow from discontinued operating activities |
|
|
(157,274 |
) |
|
|
1,014,062 |
|
Net cash flow from discontinued investing activities |
|
|
- |
|
|
|
(359,249 |
) |
Net cash flow from discontinued financing activities |
|
|
- |
|
|
|
- |
|
Net change in cash, cash equivalents, and restricted cash from discontinued operations |
|
|
(157,274 |
) |
|
|
654,812 |
|
Effect of exchange rate changes on cash |
|
|
- |
|
|
|
381,918 |
|
Net change in cash, cash equivalents, and restricted cash |
|
|
(27,737,135 |
) |
|
|
(286,073 |
) |
Cash, cash equivalents, and restricted cash, beginning of period: |
|
|
33,374,976 |
|
|
|
6,794,093 |
|
Cash, cash equivalents, and restricted cash, end of period |
|
$ |
5,637,841 |
|
|
$ |
6,508,020 |
|
12