VSE Corporation Reports 58% Revenue Growth to $256M, Net Loss of $9M in Latest Quarter

VSE Corporation reported significant financial growth in its latest quarterly results, with total revenues reaching $256.0 million for the three months ended March 31, 2025, a 58% increase from $162.4 million in the same period last year. The company's operating income also rose to $24.5 million, up 57% from $15.6 million in the prior year. However, VSE recorded a net loss of $9.0 million, compared to a loss of $6.6 million in the previous year, primarily due to losses from discontinued operations related to the sale of its Fleet segment.

The increase in revenue was largely driven by the company's acquisitions of Turbine Controls, Inc. and Kellstrom Aerospace, which contributed to a 76% rise in repair revenue and a 49% increase in distribution revenue. The company also noted that strong market activity in global commercial air travel and the execution of new distribution contracts played a crucial role in this growth. In contrast, costs and operating expenses increased in line with revenue, totaling $231.5 million, which included $6.1 million in amortization of intangible assets related to acquisitions.

VSE's strategic focus on higher-margin aftermarket parts distribution and maintenance, repair, and overhaul (MRO) services has led to the divestiture of its Federal and Defense segments, with the sale of the Fleet segment completed in April 2025 for approximately $230 million. This strategic shift aims to enhance the company's position in the aviation aftermarket, allowing for greater investment in core business areas. The company also opened a new distribution facility in Europe, further expanding its geographic reach.

Operationally, VSE's customer base has expanded, with a notable increase in engagement metrics. The company reported a significant rise in customer counts and product adoption rates, bolstered by new partnerships with original equipment manufacturers (OEMs). As of March 31, 2025, VSE had 20.7 million shares outstanding, reflecting an increase from 15.8 million shares a year earlier, indicating a growing investor interest in the company.

Looking ahead, VSE remains optimistic about its growth trajectory, supported by its recent acquisitions and strategic initiatives. The company anticipates continued revenue growth driven by increased demand for its aviation aftermarket services and products. Additionally, VSE has entered into a new credit agreement, providing enhanced liquidity and flexibility to support its ongoing operations and future growth initiatives.