One Stop Systems, Inc. (OSS) announced a new $1.2 million production order from Safran Federal Systems, a major defense contractor. The order follows a September 2025 award and brings OSS’s cumulative order value from Safran to roughly $7 million over the next five years, up from the original $3 million expectation.
The contract expands OSS’s portfolio of 4U short‑depth servers engineered for military platforms, reinforcing its position in the rugged edge‑computing market. The additional production order is expected to generate incremental revenue and strengthen OSS’s recurring revenue stream from a high‑margin defense customer.
OSS’s Q3 2025 earnings showed revenue of $18.8 million, beating the consensus estimate of $16.24 million, and earnings per share of $0.01, in line with expectations. The revenue beat was driven by strong demand for OSS’s PCIe switch‑fabric technology and ruggedized compute solutions, which have become critical for AI‑enabled sensor processing in defense applications. The company’s operating margin expanded to 12.5% from 11.8% in the prior quarter, reflecting pricing power in its high‑margin defense segment and effective cost control amid rising component costs.
CEO Mike Knowles said, “We are excited to deepen our relationship with Safran and support the continued expansion of this production program.” He added that OSS’s ability to deliver reliable, enterprise‑class compute platforms for mission‑critical environments is enabling the company to win follow‑on production orders, expand existing programs, and win new platforms. The new order underscores OSS’s strategy to capture growth in both defense and commercial markets, including a recent pivot to healthcare AI.
The order’s impact on OSS’s backlog is significant: the cumulative value from Safran now approaches $7 million, more than double the original expectation. This growth in the backlog signals strong customer confidence and positions OSS to capture additional revenue from the same partner. The contract also highlights OSS’s proprietary PCIe switch‑fabric technology as a key differentiator, giving the company a competitive edge in the rugged edge‑computing market.
The market has responded positively to OSS’s continued execution. Investors have noted the company’s Q3 earnings beat, the expansion of its defense backlog, and the strategic importance of repeat business from a key partner. Analysts have highlighted OSS’s ability to maintain high margins while scaling its defense portfolio, reinforcing confidence in the company’s long‑term growth trajectory.
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