One Stop Systems, Inc. (OSS) reported financial results for the third quarter ended September 30, 2026, highlighting year-over-year revenue growth and updated full-year guidance. Total revenue from continuing operations increased to $12.6 million for the third quarter, up 35.9% from $9.3 million in the prior year period. The company attributes this growth to new customers and higher production volumes, specifically citing initial deliveries to a new customer developing autonomous energy nodes, higher production deliveries to a commercial aerospace customer for in-flight entertainment systems, and increased sales to a medical imaging OEM.
For the nine months ended September 30, 2026, total revenue from continuing operations reached $30.0 million, representing a 48.3% increase from the prior year. Key drivers for the year-to-date period included higher sales supporting the P-8A Poseidon reconnaissance aircraft, military applications on naval vessels, and customer-funded development programs.
Gross margin from continuing operations was 42.6% for the third quarter, down from 45.6% in the prior year. The company attributes the decrease to product mix. For the nine-month period, gross margin was 43.9%, a slight decrease compared to 44.4% in the prior year.
Operating expenses from continuing operations increased 33.7% to $6.2 million in the third quarter. The increase was driven by $0.5 million in bad debt expense related to a former customer's bankruptcy, $0.4 million in legal fees from a settlement with a former customer, and $0.5 million in higher stock-based compensation expense. The company reported a loss from continuing operations of $0.6 million, or $0.02 per diluted share, for the quarter.
Adjusted EBITDA from continuing operations was $0.3 million for the third quarter, compared to $0.2 million in the prior year. Excluding bad debt and legal expenses, adjusted EBITDA would have been approximately $1.2 million, or nearly 10% of revenue. For the nine months, adjusted EBITDA was $0.1 million.
On October 28, 2026, OSS announced it is increasing its full-year 2026 revenue growth guidance to approximately 40%, up from the previous range of 25% to 30%. The company also projects gross margin of approximately 40% to 42% and adjusted EBITDA of $0.5 million to $1.0 million for the full year. The company noted that its year-to-date book-to-bill ratio was 1.46x.
