Tucows Inc. TCX reported a narrower net loss in the second quarter of 2024, driven by solid revenue growth across its key segments and improved cost management, particularly within its Ting Internet Services division.

Despite ongoing challenges related to increased network-related expenses, TCX saw notable improvements in gross profit and adjusted EBITDA, reflecting the company’s strategic focus on operational efficiencies and scaling its infrastructure. The continued execution of a deleveraging strategy, alongside the sustained performances in its Domain Services and Wavelo Platform Services segments, positions Tucows for potential financial flexibility moving forward.

Tucows Inc. Price, Consensus and EPS Surprise

 

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Q2 Results

TCX reported a second-quarter 2024 loss per share of $1.70, narrower than the loss of $2.86 reported in the year-ago quarter.

Tucows reported consolidated net revenues of $89.4 million for second-quarter 2024, marking a 5.2% increase from $85 million in the prior-year quarter.

Strong quarterly earnings resulted from solid performances in the Ting Internet Services and Domain Services segments.

Segmental Performances

Ting Internet Services: Revenues from the segment rose to $14.6 million in second-quarter 2024 from $12.4 million in second-quarter 2023. The 17.5% rise was driven by robust subscriber growth.

Gross profit in this segment increased significantly year over year to $9.8 million from $7.1 million, reflecting improved operating efficiencies. Notably, the operating loss for Ting Internet Services segment narrowed to $6.4 million from $10.3 million, underscoring better cost management and increased scale.

Wavelo Platform Services: The segment’s revenues were relatively flat at $10.5 million compared with $10.3 million in the prior-year quarter.

However, gross profit showed a marginal year-over-year improvement to $10.2 million from $10.1 million. Adjusted EBITDA for Wavelo also increased to $3.9 million from $3.4 million, supported by stable revenues and cost efficiencies in platform operations.

Tucows Domain Services: The segment continued to be a strong contributor, with revenues increasing to $62.4 million from $60 million in second-quarter 2023. Wholesale Domain Services generated $53 million in revenues, up from $51.5 million. Retail Domain Services revenues rose to $9.3 million from $8.4 million.

Gross profit for this segment increased year over year to $18.9 million from $17.9 million, driven by steady demand for domain registration and value-added services. Adjusted EBITDA in the segment also improved to $11.2 million from $10.6 million.