Unisys (UIS) FY Conference August 26, 2025 05:50 PM ET Company ParticipantsMichaela Pewarski - VP - IRShalabh Gupta - VP - Tax & Corporate TreasurerConference Call ParticipantsNone - AnalystOperatorYour next presentation is Unisys traded on the New York Stock Exchange with ticker UIS. Representing them today is VP and trader, Shabalag Gupta, and VP and IR, Michelle Perwoski.Michaela PewarskiHi, everybody. Thanks for joining us to learn more about Unisys. We're going to start with a quick overview of the com ...

Core Insights - Unisys Corporation is strategically repositioning itself in the AI-driven IT services sector through its ClearPath Forward 2050 strategy, focusing on AI, automation, and data-driven intelligence across its offerings [1][11] - The company is addressing enterprise challenges such as data fragmentation and low productivity by leveraging AI technologies, exemplified by its Service Experience Accelerator [2][11] - Unisys is developing agentic-AI frameworks to enhance decision-making and service delivery, creating new revenue opportunities in endpoint management and AI-enabled infrastructure [3][11] AI Innovations - The Service Experience Accelerator utilizes generative AI and workflow automation to improve service desk operations, gaining traction among clients [2] - The intelligence accelerator connects siloed datasets, providing secure and real-time insights, which enhances service delivery [3] Industry Positioning - Unisys is recognized as a "disruptor" in the AI Services sector and is investing in post-quantum cryptography and threat detection solutions [4] - The company competes with major players like C3.ai, Palantir Technologies, and IBM, each with unique AI strategies [6] Financial Performance - Unisys shares have increased by 12% over the past three months, while the industry has grown by 20.1% [9] - The stock has risen by 22.4% in three months, with projected earnings per share (EPS) growth of over 120% for 2026 [11] - The current valuation shows a forward price-to-earnings ratio of 4.73X, indicating a discount compared to industry peers [12] Earnings Estimates - The Zacks Consensus Estimate predicts a year-over-year earnings increase of 28.9% for 2025 and 120.7% for 2026 [14] - Current estimates for EPS in 2025 and 2026 are 0.58 and 1.28, respectively, reflecting significant growth potential [16]

Financial Data and Key Metrics Changes - First quarter revenue was $432 million, down 11.4% year over year as reported and 8.5% in constant currency, primarily due to license and support renewal timing [24] - First quarter adjusted EBITDA was $40 million, with a margin of 9.3% [32] - First quarter net income was negative $30 million, translating to a diluted loss of $0.42 per share [33] - First quarter pre-pension free cash flow was $23 million, up $11 million year over year [33] Business Line Data and Key Metrics Changes - Digital Workplace Solutions segment revenue declined 7.5% year over year to $119 million, primarily driven by lower field service volumes [26] - Cloud Applications and Infrastructure Solutions revenue declined 3.3% year over year to $177 million, affected by lower volumes with existing clients [27] - Enterprise Computing Solutions revenue was down 11.2% year over year to $119 million, due to license and support renewal timing [28] Market Data and Key Metrics Changes - First quarter new business total contract value (TCV) was $434 million, including $337 million from new business signings, up more than 50% sequentially and more than 80% year over year [9] - Backlog at the end of the first quarter was $2.9 billion, up 2% sequentially and 4% year over year [29] Company Strategy and Development Direction - The company is focused on enhancing free cash flow by optimizing delivery and improving cash conversion efficiency [6] - The ClearPath Forward 02/1950 strategy aims to expand and enhance the ecosystem of software and industry solutions [16] - The company is investing in technology, talent, and innovation to solidify its operating systems at the core of clients' IT operations [16] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving full year revenue growth guidance and profitability guidance, despite macroeconomic uncertainties [18][78] - The company expects delayed client decision-making to have a marginal impact on revenue trajectory, but believes its diverse solution portfolio provides stability [19][21] - Management noted that clients are focused on modernizing applications and enhancing security, which supports growth in the security segment [12][13] Other Important Information - The company achieved titanium partner status at Dell, enhancing growth incentives and access to resources [17] - The first quarter gross profit was $108 million, with a gross margin of 24.9% [30] - The company is actively monitoring market conditions to opportunistically expand its debt structure and advance its pension mitigation strategy [39] Q&A Session Summary Question: What is enabling the L and S upside in revenues? - Management indicated that increased consumption and longer contract extensions are driving the upside in license and support revenues [44][46] Question: What types of sequential growth assumptions are needed in ex L and S and L and S? - Management expects increasing growth assumptions every quarter, with significant contracts expected in Q3 and Q4 [50][52] Question: How confident are you in your 2026 targets? - Management remains confident in meeting cash flow expectations and has not seen a decline in pipeline quality despite macro uncertainties [59][60] Question: How is the quality of the backlog assessed? - Management stated that the pipeline is growing and the quality is better aligned to solutions that the company can win, with no need for natural pairing [68][75]

Unisys (UIS) Q1 2025 Earnings Call May 01, 2025 08:00 AM ET Company Participants Michaela Pewarski - Vice President, Investor RelationsMike Thomson - CEO & PresidentDebra McCann - Executive VP & CFORod Bourgeois - Head of Research Conference Call Participants Anja Soderstrom - Senior Equity Research AnalystArun Seshadri - Head - US Credit Desk Analysts Operator Please note this event is being recorded. I would now like to turn the conference over to Mikayla Paworski, Vice President of Investor Relations. Pl ...

Financial Data and Key Metrics Changes - First quarter revenue was $432 million, down 11.4% year over year as reported and 8.5% in constant currency, primarily due to license and support (LNS) renewal timing [25][26] - First quarter net income was negative $30 million, translating to a diluted loss of $0.42 per share, while adjusted net loss was $3 million for the quarter, a diluted loss per share of $0.05 [35] - First quarter non-GAAP operating profit margin was 2.8%, compared to 7.1% in the prior period, in line with low single-digit expectations [34] Business Line Data and Key Metrics Changes - Digital Workplace Solutions (DWS) revenue declined 7.5% year over year to $119 million, primarily driven by lower field service volumes and discretionary project work [27] - Cloud Applications and Infrastructure Solutions revenue declined 3.3% year over year to $177 million, affected by lower volumes with existing clients [28] - Enterprise Computing Solutions revenue was down 11.2% year over year to $119 million, due to LNS renewal timing [29] Market Data and Key Metrics Changes - First quarter total contract value was $434 million, including $337 million from new business signings, up more than 50% sequentially and more than 80% year over year [9][30] - Backlog at the end of the first quarter was $2.9 billion, up 2% sequentially and 4% year over year [30] - The company expects a growing PC refresh cycle to support field service volumes as clients begin upgrades related to AI and Windows 11 [7] Company Strategy and Development Direction - The company is focused on enhancing free cash flow by optimizing delivery and improving cash conversion efficiency [6] - The ClearPath Forward 02/1950 strategy aims to expand and enhance the ecosystem of Unisys software and industry solutions [17][78] - The company is actively monitoring market conditions to opportunistically expand its debt structure and advance its pension mitigation strategy [21][78] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving full year revenue growth guidance and profitability guidance, citing resilience in diverse revenue streams [78] - The company anticipates delayed client decision-making due to macroeconomic uncertainties but believes this will have a marginal impact on overall revenue [21][62] - Management noted that security remains an area of outsized growth within the market, with ongoing enhancements to the security portfolio [13] Other Important Information - First quarter capital expenditures totaled approximately $20 million, relatively flat year over year [35] - The company achieved a strong liquidity position with cash balances increasing to $393 million as of March 31 [36] - The company was elevated to disruptor status in AI services and named a leader in attack surface management by industry analysts [18] Q&A Session Summary Question: What is enabling the L and S upside in revenues? - Management indicated that increased consumption and longer contract extensions are driving the L and S revenue upside, with clients extending contracts from three to five years to seven years [46][48] Question: What types of sequential growth assumptions are needed in ex L and S and L and S? - Management expects increasing growth assumptions every quarter, with Q2 showing a slight uptick and more significant growth anticipated in Q3 and Q4 [51][52] Question: How confident is the company in its 2026 targets? - Management remains confident in meeting cash flow expectations and sees no change in the trajectory for 2026 targets [60] Question: How is the quality of the pipeline and backlog assessed amid macro uncertainties? - Management reported that the pipeline is growing, with no need for natural pairing, and the quality of the pipeline is better aligned to solutions that can be won [72][75]