One Stop Systems Reports 10.2% Revenue Decline to $54.7 Million in 2024

One Stop Systems, Inc. (OSS) reported a total revenue of $54.7 million for the fiscal year ended December 31, 2024, a decrease of 10.2% compared to $60.9 million in 2023. The decline was primarily attributed to a significant reduction in sales to a former media and entertainment customer, which ceased shipments in the second quarter of 2023. This decrease was partially offset by increased sales in the military and defense sectors, which accounted for approximately 46% of OSS's segment sales in 2024. The company's gross profit also fell to $7.7 million, resulting in a gross margin of 14.1%, down from 29.5% in the previous year, largely due to inventory obsolescence allowances and contract losses.

Operating expenses for OSS decreased to $21.1 million in 2024 from $25.9 million in 2023, primarily due to the absence of a goodwill impairment charge that was recorded in the prior year. However, marketing and selling expenses increased by 20.4% to $8 million, reflecting higher personnel costs and increased participation in trade shows. The company reported a net loss of $13.6 million for 2024, compared to a net loss of $6.7 million in 2023, driven by the decline in revenue and increased costs associated with inventory adjustments.

Strategically, OSS has focused on expanding its presence in the military and defense markets, which typically involve longer sales cycles and complex contracting processes. The company has made significant organizational changes, including the appointment of new executives with extensive experience in the defense industry. In 2024, OSS introduced several new products, including the Torrey Break edge super-computing platform, which has generated interest from major military contractors and the U.S. Department of Defense.

As of December 31, 2024, OSS had approximately 110 employees, with a slight increase in headcount compared to the previous year. The company continues to face challenges related to supply chain disruptions and inflation, which have affected its ability to meet customer demand and manage costs effectively. Looking ahead, OSS aims to leverage its strategic focus on rugged edge computing solutions to drive growth and improve profitability, despite the ongoing economic uncertainties and geopolitical tensions that may impact its operations.