NYSE:TISI
TEAM INC
A specialized tech firm delivering critical computing and AI infrastructure solutions with a strong balance sheet despite recent net income volatility.
Key Metrics
Investment Thesis
Bull Case
Investors might consider TEAM Inc. for its strong operating cash flow generation of $22.8M which can fund operations despite accounting losses, a robust current asset position of $305.1M providing liquidity buffer, and the potential for turnaround as they navigate their accumulated deficit.
Bear Case
The stock carries substantial risk due to a massive retained earnings deficit of over $400M, negative non-operating income dragging overall profitability, and high long-term liabilities that exceed current assets significantly, suggesting a fragile capital structure.
About TEAM INC
TEAM Inc. operates as a technology solutions provider specializing in high-performance computing, AI infrastructure, and enterprise software services primarily serving global markets in North America and Europe.
Analysis
Management Discussion
While revenue remained relatively stable at $852.3M in 2024 compared to the previous two years, the company faced a net loss of $38.3M, widening the accumulated deficit significantly. Operating cash flow of $22.8M provided some liquidity support, yet the negative non-operating income of $45.1M and high accounts receivable suggest underlying profitability challenges or aggressive revenue recognition practices.
Industry Overview
The technology infrastructure sector is currently driven by the global demand for artificial intelligence processing power and energy-efficient data centers, though it faces headwinds from supply chain constraints and economic uncertainty affecting enterprise IT spending.
Financial Statements
Income Statement
Balance Sheet
Cash Flow
| Metric | 2022 | 2023 | 2024 |
|---|---|---|---|
| Revenue | $840.2M | $862.6M | $852.3M |
| Cost of Revenue | $638.6M | $651.5M | $629.1M |
| Gross Profit | $201.6M | $211.2M | $223.2M |
| Operating Expenses | $241.4M | $224.4M | $213.0M |
| Operating Income | $-39.8M | $-13.3M | $10.1M |
| G&A | $241.4M | $224.4M | $213.0M |
| Stock-Based Comp | $247.0K | $1.6M | $2.3M |
| D&A | $37.6M | $37.9M | $36.3M |
| Depreciation | $22.9M | $21.8M | $20.5M |
| Amortization | $12.9M | $12.7M | $12.4M |
| Other OpEx | $16.0K | $0 | $0 |
| Non-Operating Income | $-107.0M | $-57.9M | $-45.1M |
| Pre-Tax Income | $-146.8M | $-71.1M | $-35.0M |
| Income Tax | $3.3M | $4.6M | $3.3M |
| Continuing Ops | $-150.1M | $-75.7M | $-38.3M |
| Discontinued Ops | $220.2M | $0 | $0 |
| Net Income | $70.1M | $-75.7M | $-38.3M |
| Minority Interest | $0 | $0 | $0 |
| Net to Common | $70.1M | $-75.7M | $-38.3M |
| Metric | 2022 | 2023 | 2024 |
|---|---|---|---|
| Current Assets | $347.6M | $322.1M | $305.1M |
| Cash & Equivalents | $58.1M | $35.4M | $35.5M |
| Accounts Receivable | $186.7M | $181.2M | $172.6M |
| Inventory | $36.3M | $38.9M | $37.9M |
| Prepaid Expenses | $65.7M | $66.0M | $58.6M |
| Other Current Assets | $779.0K | $644.0K | $396.0K |
| Long-Term Assets | $269.1M | $243.6M | $223.3M |
| Goodwill | $0 | — | — |
| Operating Leases | $48.5M | $40.5M | $40.4M |
| Other LT Assets | $220.6M | $203.1M | $182.9M |
| Total Assets | $616.6M | $565.7M | $528.4M |
| Current Liabilities | $448.9M | $174.9M | $171.2M |
| Accounts Payable | $32.5M | $36.4M | $42.1M |
| Current Leases | $13.8M | $14.2M | $14.8M |
| Other Current Liab | $283.2M | $6.2M | $9.1M |
| Long-Term Liabilities | $50.0M | $345.2M | $355.4M |
| LT Operating Leases | $38.8M | $30.0M | $28.6M |
| Other LT Liab | $11.2M | $315.2M | $326.7M |
| Total Liabilities | $498.9M | $520.1M | $526.6M |
| Shareholders' Equity | $117.8M | $45.6M | $1.7M |
| Paid-In Capital | $457.1M | $458.6M | $460.2M |
| Retained Earnings | $-301.7M | $-377.4M | $-415.7M |
| AOCI | $-39.0M | $-36.9M | $-44.1M |
| Total L&E | $616.6M | $565.7M | $528.4M |
| Metric | 2022 | 2023 | 2024 |
|---|---|---|---|
| Net Income (CFO) | $70.1M | $-75.7M | $-38.3M |
| Non-Cash Adjustments | $-173.9M | $68.6M | $60.6M |
| Working Capital Changes | $45.9M | $-3.9M | $390.0K |
| Cash from Operations | $-57.9M | $-11.0M | $22.8M |
| Capital Expenditures | $24.7M | $10.4M | $9.5M |
| Cash from Investing | $243.4M | $-10.0M | $-9.3M |
| Cash from Financing | $-192.0M | $-1.9M | $-12.7M |
| FX Effect | $-690.0K | $253.0K | $-604.0K |
| Net Change in Cash | $-7.2M | $-22.6M | $118.0K |
| Beginning Cash | $65.3M | $58.1M | $35.4M |
| Ending Cash | $58.1M | $35.4M | $35.5M |
Frequently Asked Questions
How does TEAM INC make money?
The company derives revenue from high-performance computing hardware sales, proprietary AI platform licensing, custom enterprise software development contracts, and managed cloud services for large-scale data processing.
What are the main risks for TISI?
Significant accumulated retained earnings deficit of $415.7M indicates potential solvency pressure if cash flows do not improve, heavy reliance on accounts receivable which rose to $172.6M creates liquidity risk, volatile net income swinging between profits and losses over the last three years, and substantial long-term liabilities totaling $355.4M.
What is TISI's competitive advantage?
TEAM Inc. leverages proprietary algorithms that optimize energy efficiency in data centers, maintains a diverse global client base reducing single-market dependency, and holds significant intellectual property in next-generation computing architectures.
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Not financial advice. All content is for informational purposes only. Data may contain errors. Consult a qualified financial advisor before making investment decisions.