Csquare, Inc. (NYSE:CSQR) stock is trading higher by almost 15% on Tuesday after the company on Monday reported better-than-expected third-quarter 2026 results, with sales exceeding Wall Street's expectations.
The carrier-neutral data centers operator reported a quarterly loss of 58 cents per share, wider than the analyst estimate of a 49-cent loss.
Csquare stock is among today's top performers. Why is CSQR stock surging?
Revenue rose 25.6% year over year to $302.3 million, beating the $281.5 million estimate.
CEO Spencer Mullee highlighted strong revenue growth, record bookings and meaningful operating leverage, supported by sustained demand for the company's carrier-neutral digital infrastructure platform.
Management attributed sales growth to continued demand for its colocation platform, customer deployments across existing and newly acquired facilities and expansion of its recurring infrastructure services.
Strong Commercial Activity and Backlog
The company reported annualized bookings of $66.1 million, marking its 14th consecutive quarter of sequential bookings growth across enterprise, network cloud and higher-density deployments.
Management highlighted continued expansion of the commercial pipeline and strong pricing as drivers.
The company entered the fourth quarter with about $114 million in contracted annualized revenue backlog.
Contracted power capacity increased nearly 47% to 428 megawatts (MW), compared with 292 MW a year earlier.
Sellable capacity reached 397 MW following the commissioning of nearly 12 MW during the quarter.
Contracted utilization increased to 108% from 88% a year earlier, indicating demand exceeding current sellable capacity.
Quarterly net revenue churn remained stable at 1.9%, reflecting strong customer retention.
Business Highlights
Adjusted EBITDA increased 44.3% year over year to $132.1 million.
Adjusted EBITDA margin expanded to 47.8% from 40.5%, reflecting continued revenue growth, disciplined execution and the inherent operating leverage of the company's highly recurring business model.
Net loss widened to $88.1 million from $29.8 million, impacted by higher interest expenses and $58.6 million of IPO-related transaction and compensation costs.
In July 2026, Csquare completed its IPO of 50 million shares at an offer price of $21 per share and commenced trading on the NYSE.
The company generated approximately $1.16 billion in net proceeds, including proceeds from the underwriters' exercise of their option to purchase additional shares, and used approximately $1.1 billion to repay debt.
The company ended the quarter with $34.7 million in cash and cash equivalents and a long-term debt of $3.8 billion.
Outlook
Csquare tightened its full-year 2026 revenue forecast to $1.14 billion-$1.16 billion from $1.13 billion-$1.17 billion. Wall Street expects $1.124 billion.
The company raised its Adjusted EBITDA outlook to $490 million-$500 million from $460 million-$480 million.
It expects growth capital expenditure of $620 million to $640 million and recurring capital expenditure of $50 million to $60 million.
Management highlighted strong pricing with renewal spreads reaching 17%, indicating robust market demand and limited supply.
CSQR Price Action: Csquare shares were up 15% at $17.60 at the time of publication on Tuesday, according to market data.
