Data Storage 2025 Q3 Earnings Record Net Income Surges 13482.8% on CloudFirst Divestiture

Data Storage Corporation (DTST) reported fiscal 2025 Q3 earnings on Nov 19, 2025, with revenue rising 28.2% to $416,956 and net income surging 13,482.8% to $16.78 million. The stock gained 3.14% in a single trading day and 3.89% over the prior week, reflecting strong post-earnings sentiment.

Revenue

Total revenue increased by 28.2% to $416,956 in 2025 Q3, compared to $325,299 in 2024 Q3, driven by the divestiture of the CloudFirst subsidiary and a strategic refocus on core operations.

Earnings/Net Income

Data Storage’s EPS skyrocketed 11,400% to $2.30, up from $0.02 in 2024 Q3, while net income surged to $16.78 million, a 13,482.8% increase. The EPS surge of 11,400% and net income growth of 13,482.8% indicate robust profitability, driven by the CloudFirst sale.

Post-Earnings Price Action Review

The strategy of buying DTST when revenue beats and holding for 30 days shows promise, supported by the CloudFirst sale boosting liquidity and refocusing on Nexus. The company’s $10–$15 million post-tender cash target and plans to explore acquisitions by March 2026 signal disciplined growth. Market sentiment remains strong despite volatility, with 17.6% year-over-year sales growth and a strategic pivot to GPU IaaS, AI-driven software, and cybersecurity. Risks include market volatility and integration challenges, but management’s disciplined approach and Nexxis’ stable revenue base provide a foundation for long-term value creation.

CEO Commentary

CEO Charles Piluso emphasized the CloudFirst sale’s transformative impact, unlocking $40 million in liquidity and enabling a strategic shift to high-growth sectors. Nexxis’ recurring revenue growth and the DSC 2.0 strategy highlight a focus on disciplined acquisitions and operational efficiency.

Guidance

The company projects $5–$15 million in cash post-tender, with plans to launch a new corporate website, pursue acquisitions, and maintain Nexxis’ growth trajectory. CFO Chris Panagiotakos noted Q3 SG&A expenses of $1.3 million as a sustainable run rate.

Additional News

1. M&A Activity: DTST completed the $40 million CloudFirst sale, freeing capital for AI, cybersecurity, and GPU IaaS investments. The proceeds simplify operations and align with strategic priorities.

2. Capital Return: The company repurchased warrants exercisable for 858,750 shares, spending $2.05 million under the 2021 warrant provisions. This follows shareholder demands for transparency and reinforces financial discipline.

3. C-Level Commentary: CEO Chuck Piluso reiterated “cautious optimism” during the earnings call, emphasizing strategic acquisitions and Nexxis’ role as a recurring revenue base. The board remains focused on a $10.8 million ATM facility for shareholder value enhancement.