America’s Most Successful Small-Caps: The Little-Known Companies Powering The AI Revolution

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Big tech companies are expected to spend trillions on AI infrastructure projects for the rest of the decade, and smaller stocks will be among the biggest beneficiaries.

Read the full story on Forbes: https://www.forbes.com/sites/hanktucker/2025/11/07/americas-most-successful-small-caps-the-little-known-companies-powering-the-ai-revolution/

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Transcript

00:00Today on Forbes, America's most successful small caps, the little-known companies powering the AI revolution.

00:07In March of 2024, Dell Technologies launched its so-called AI factory with NVIDIA,

00:13combining Dell's servers and networking power with NVIDIA's semiconductors and software to produce AI-driven products for other enterprises.

00:21While Dell's stock has grown four-fold since early 2023 due to its AI focus,

00:27behind the scenes, a little-known company called TSS Inc. has been a much bigger winner.

00:33Dell named TSS a quote-unquote first-choice partner for data center integration in September of 2023.

00:40By October 2024, TSS, whose market cap was only $10 million in September of 2023,

00:47signed a multi-year deal with Dell to integrate AI-enabled server racks.

00:51As of early November, TSS is valued at $440 million, with shares up 6,000% since early last year.

01:00The company's revenues nearly tripled last year and grew 410% in the first half of 2025.

01:07Its critical, higher-margin rack integration segment involves constructing, wiring,

01:12and installing cooling plumbing systems for complex servers.

01:15Peter Woodward, TSS's chairman, says,

01:18Everybody asks about why our OEM customer doesn't either do this themselves or acquire us,

01:24and the answer is pretty simple.

01:26They're very happy with the service they're getting today.

01:29Woodward expects to grow TSS's capacity to be able to serve other customers as well,

01:35eyeing cloud service providers like Amazon, Microsoft, and Oracle.

01:38Thanks to Dell, TSS earned the number one spot on Forbes' 2025 ranking of America's most successful small-cap companies.

01:48To come up with the 100 best small-cap stocks, Forbes analyzed about 1,400 companies

01:53with market caps between $300 million and $5 billion.

01:58Ken Farsalis, portfolio manager of the Oberweiss Small-Cap Opportunities Fund,

02:03which has $1.7 billion in assets, says,

02:06We believe AI will disproportionately benefit small-cap businesses because they're more nimble,

02:12and they'll be better able to adapt and implement AI workflows.

02:17Large-cap companies are fat and lazy and loaded with bureaucracy.

02:21For them, it's like turning an oil tanker in a river.

02:24For investors looking for small-cap names directly linked to the AI revolution

02:28with more customer diversification than TSS,

02:32there are more than a dozen to choose from on Forbes' list.

02:36The fourth-ranked firm on the list,

02:38Inadata, a $2 billion market-cap data engineering firm in Richfield Park, New Jersey,

02:44is the fourth-ranked small-cap on Forbes' list linked to the AI revolution.

02:49Under the leadership of CEO Jack Abbehoff since 1997,

02:54the firm has seen a significant boost from the AI revolution.

02:57The company's core business involves processing and supplying large volumes of data

03:02to major tech firms, which is essential for training their AI models.

03:06Inadata's $228 million in 12-month sales have doubled year-over-year,

03:12netting $43 million in profit,

03:14with five of the so-called Magnificent Seven tech giants as customers.

03:18Shares are up 2,000% since early 2023,

03:23and analysts suggest Meta's $29 billion valuation deal for a 49% stake in competitor's scale AI

03:30could drive Meta to look to other options like Inadata for their data needs.

03:35The top 20 on the list also include industrial power providers Power Solutions International,

03:40Argon, Gramcorp, and Powell Industries,

03:43whose stocks have all soared from providing the energy infrastructure for data centers.

03:48Growth investors could also look at Ampria's Technologies,

03:52a battery manufacturer based in Fremont, California,

03:55focused on drones and robotics,

03:57as an interesting prospect for growth investors.

04:00After going public via a SPAC merger in September of 2022,

04:04the company initially lost 93% of its value by September of 2024.

04:09However, it has since staged a dramatic comeback,

04:13recouping all losses with a 1,500% gain as of early November,

04:17despite recording only $33 million in revenue over the last year.

04:22This performance earned it the 82nd spot on the list.

04:25Similarly, Omdas Holdings, a Boston-based drone maker, achieved the 79th spot.

04:31Despite having just $16 million in 12-month sales,

04:35a 600% increase in its stock price over the last year

04:38has propelled its market capitalization to $1.5 billion.

04:41For full coverage and to see the whole list,

04:45check out Hank Tucker's piece on Forbes.com.

04:48This is John Palmer from Forbes.

04:50Thanks for tuning in.

America’s Most Successful Small-Caps: The Little-Known Companies Powering The AI Revolution

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