Tucows Inc.’s TCX third-quarter 2024 results reflect a clear focus on revenue and margin improvement, driven largely by the Ting Internet and Tucows Domain segments. The company emphasized capital efficiency in the Ting Internet business through a strategic pivot and workforce reduction. These efforts have helped mitigate the impacts of network-related depreciation and amortization costs.

Q3 Results

The company reported a third-quarter 2024 net loss of $2.03 per share, narrower than the $2.09 loss in the year-ago quarter.

Total quarterly revenues of $92.3 million increased 6.1% from $87 million in the prior-year quarter.

The quarterly results were primarily fueled by gains in the Ting Internet Services and Tucows Domain Services segments.

Tucows Inc. Price, Consensus and EPS Surprise

 

Tucows Inc. price-consensus-eps-surprise-chart | Tucows Inc. Quote

Segmental Performance

Ting Internet Services: Revenues from fiber internet services climbed 19% to $15.3 million in the third quarter of 2024 from $12.9 million in the prior-year quarter. The gross margin for this segment rose to $10.9 million in the third quarter of 2024 from $8 million in the prior-year quarter. While network depreciation costs continued to impact this segment, cost-cutting measures, including workforce reductions, have helped offset these expenses, improving profitability.

Wavelo Platform Services: Revenues from this segment declined 9% to $10.1 million in the third quarter of 2024 from $11.1 million in the prior-year quarter. This decline was attributed to reduced revenues in other professional services within the segment. Gross profit from the segment fell approximately 5% year over year as overall demand softened.

Tucows Domain Services: This segment showed steady growth, with revenue increasing 6% to $64.7 million in the third quarter of 2024 from $61.1 million in the prior-year quarter. Within this segment, wholesale domain services’ revenues rose 6% to $55 million in the reported quarter from $51.9 million in third-quarter 2024. The gross margin also increased from $18.4 million in the third quarter of 2024 to $19.8 million in the prior-year quarter, supported by value-added services’ growth. Retail revenues rose 5% year over year, benefiting from a steady customer base and increased subscription renewals.

Profitability Metrics

The company’s gross profit grew 32.4% to $22.2 million in the third quarter of 2024 from $16.8 million a year ago. The rise was attributed to strong margin improvements in the Ting Internet and Tucows Domain segments despite network depreciation expenses in the Ting network.