Unisys Corporation New · NYSE:UIS
Unisys Corporation New — Q2 2025 Earnings Presentation
31 slides from Unisys Corporation New's earnings presentation, Jul 31, 2025
Slide 1: Second Quarter Financial Results
Second Quarter Mike Thomson Chief Executive Officer Financial Results & President JULY 30, 2025 Deb McCann Chief Financial Officer
Slide 2: Disclaimer
Disclaimer Forward-Looking Statements This presentation contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, Section 21E of the Securities Exchange Act of 1934, as amended, and the Private Securities Litigation Reform Act of 1995. Unisys ca
Slide 3: 2Q25 Highlights
2Q25 Highlights Revenue Operating Profit & Free Cash Flow 2Q revenue of $483M exceeded expectations; constant currency 2Q operating margin of 6.3%; non-GAAP Operating margin of (“CC”) revenue growth of 1.0% year-over-year (“YoY”) and (0.4%) 7.6%, exceeding expectations in Ex-L&S solutions Increasing
Slide 4: 2Q Revenue ($M)
2Q Revenue ($M) COMPANY DWS CA&I ECS 1.1% YoY 1.0% cc1 YoY (0.1%) YoY Up 4.5% as reported, or Down (4.5%) as reported, Up 7.3% as reported, or up (0.4%) cc 1 YoY up 4.6% in cc1 or down (4.9%) in cc1 8.2% in cc1 $478 $483 $396 $396 $194 $185 $132 $138 $131 $140 2024 2025 2024 2025 2024 2025 2024 2025
Slide 5: 2Q 2025 Revenue Profile
2Q 2025 Revenue Profile Highly diverse revenue streams with large base of recurring revenue Segments CA&I 38% ECS 29% DWS 29% All Other 4% 18% Geography US & Canada 42% L&S Solutions MIX EMEA 32% OF TOTAL COMPANY Asia Pacific 15% 82% REVENUE Latin America 11% Ex-L&S Solutions Client Sector Commercia
Slide 6: 2Q Gross Margin
2Q Gross Margin COMPANY DWS CA&I ECS 20 bps expansion (30) bps YoY 70 bps expansion 10 bps expansion (110) bps YoY 27.2% 26.9% 53.3% 53.5% 18.7% 17.6% 16.2% 16.9% 20.7% 20.8% 2024 2025 2024 2025 2024 2025 2024 2025 2024 2025 Total Company Ex-L&S Total Company margins were relatively flat year- Expan
Slide 7: 2Q Profitability and Free Cash Flow ($M, except per share data)
2Q Profitability and Free Cash Flow ($M, except per share data) 2Q GAAP & Non-GAAP1 2Q GAAP Net Income (Loss) 2Q GAAP & Non-GAAP1 Diluted 2Q Operating Cash Flow Operating Profit & Margins & Adj. EBITDA1 and Margins Earnings Per Share & Free Cash Flow1 12.2% 12.7% 7.6% 6.1% 6.3% 4.9% $37 $58 $61 $29
Slide 8: 2Q EBITDA and Cash Flow Detail
2Q EBITDA and Cash Flow Detail $M 2Q25 2Q24 YTD25 YTD24 EBITDA1 $ 28.6 $ 35.6 $ 33.6 ($ 68.6) ADJUSTED EBITDA1 $ 61.4 $ 58.4 $ 101.6 $ 123.7 ADJUSTED EBITDA MARGIN 1 12.7% 12.2% 11.1% 12.8% CASH (USED FOR) PROVIDED BY OPERATIONS ($ 316.2) $ 2.7 ($ 282.9) $ 26.5 CAPITAL EXPENDITURES ($ 20.3) ($ 21.2)
Slide 9: Leverage Detail
Leverage Detail $M JUNE 30, 2025 SENIOR SECURED NOTES 1 $ 700.0 FINANCE LEASES AND OTHER DEBT 12.5 TOTAL DEBT $ 712.5 GLOBAL NET PENSION DEFICIT (AS OF DEC 31, 2024) 2 500.2 TOTAL DEBT INCLUDING PENSION DEFICIT $ 1,212.7 CASH $ 300.8 NET LEVERAGE $ 411.7 NET LEVERAGE INCLUDING PENSION DEFICIT $ 911.
Slide 10: Updated Financial Guidance
(1.0%) to +1.0% 8.0% to 9.0% Constant Currency Non-GAAP Operating Revenue Growth Profit Margin Previously 0.5% to 2.5% Previously 6.5% to 8.5% Updated • Constant currency revenue growth guidance translates to reported revenue growth of (0.5%) to +1.5% based on exchange rates as of the end of 2Q25 Fi
Slide 11: Strategic Capital Structure Objectives
Strategic Capital Structure Objectives We continue to focus on the following objectives related to our capital structure and pension Reduce the size of the U.S. Reduce uncertainty and volatility Maintain strong cash Qualified Defined Benefit (QDB) of cash requirements, including balances and liquidi
Slide 12: Steps We Have Taken… …Next Steps
Steps We Have Taken… Issued new Refinanced Extended Contributed Reallocated $700M Senior $485M notes Asset-Backed $250M to U.S. U.S. QDB Secured Notes Revolver QDB Pension Pension Plans Maturity Plans Assets …Next Steps 1 Execute Annuity Purchases to Reduce Cost of Full 2 Increase Capacity to Fund C
Slide 13: Benefits of Recent Debt Raise and Pension Actions
Benefits of Recent Debt Raise and Pension Actions Removes Enables Further Reduces GAAP Cash Flow 3-5 Year Path to Substantially All Annuity Purchase Pension Deficit & Accretive Over Full Removal of Pension Volatility Transactions Contributions Next 5 Years1 U.S. QDB Plans Reallocated assets to Incre
Slide 14: Summary of Debt Transaction
Summary of Debt Transaction Closed on Friday, June 27, 2025 Aggregate Principal $700 million of senior secured notes amount Tenor; Maturity 5.5 years; January 15, 2031 Coupon 10.625% NC-2.5 (to January 15, 2028), then callable at par plus 50% of coupon, then par plus 25% of coupon and then to par Re
Slide 15: Reduction of Volatility in the U.S. QDB Pension Plans
Reduction of Volatility in the U.S. QDB Pension Plans Provides near certainty of cash flow impact of pension contributions Prior to July 1, 2025 Target Asset Allocation Reallocated assets such that movements in assets matches 25% Opportunistic Liability movements in liabilities Hedging 50% U.S. Trea
Slide 16: Accretion to Five-Year Cash Flow
Accretion to Five-Year Cash Flow Contribution reduction exceeds interest on incremental debt • Analysis shows $70M cash flow benefit assuming minimum required pension contributions only • Benefit could improve from discretionary debt or pension payments from operational cash flows Forecasted ($M) 20
Slide 17: Ability to Continue U.S. Annuity Purchases
Ability to Continue U.S. Annuity Purchases Removes gross liability with minimal impact to net leverage and significantly reduces costs to remove U.S. QDB Pension Plans • Reduces cost of full plan termination to more manageable size – Opportunity to continue annuity purchases beyond 2026 to further r
Slide 18: Appendix
Appendix Us unisys
Slide 19: Our Portfolio of Offerings
Our Portfolio of Offerings Simplifying mission-critical IT at scale Software (L&S) Tech-Enabled Services (Ex-L&S) (~80% of Revenue)1 (~20% of Revenue)1 Consistent Revenue Recognition Up-Front License Revenue / Revenue Growth / Margin Expansion Support Over Term Cloud, Applications Digital Workplace
Slide 20: Our Opportunity
Grow Ex-L&S Accelerate ClearPath Forward revenue growth rate 2050 Our Building awareness and recognition of our solutions & capabilities Through higher-value solutions and leveraging AI to more rapidly scale Invest in L&S ecosystem, unlock data & insights, and support client Opportunity solution del
Slide 21: How Unisys enables enterprise AI
How Unisys enables enterprise AI A comprehensive, start-to-future AI portfolio with a pragmatic approach AI vision & strategy | Maturity & Readiness assessment | 1 Strategy & Consulting Roadmap development | Change management | Upskilling AI Center of Data preparation & transformation | Governance &
Slide 22: Excluding License and Support (Ex-L&S) Revenue and Gross Profit
Excluding License and Support (Ex-L&S) Revenue and Gross Profit $M 2Q25 2Q24 YTD25 YTD24 L&S REVENUE $ 87.6 $ 82.1 $ 158.7 $ 175.3 EX-L&S REVENUE 395.7 396.1 756.7 790.7 REVENUE $ 483.3 $ 478.2 $ 915.4 $ 966.0 L&S GROSS PROFIT $ 60.3 $ 55.7 $ 103.6 $ 120.5 EX-L&S GROSS PROFIT 69.7 74.2 133.9 145.4 G
Slide 23: Non-GAAP Operating Profit
Non-GAAP Operating Profit $M 2Q25 2Q24 YTD25 YTD24 GAAP OPERATING PROFIT $ 30.3 $ 23.6 $ 35.4 $ 41.3 CERTAIN LEGAL MATTERS 1 0.1 3.1 0.6 10.4 COST REDUCTION AND OTHER EXPENSES 2 6.0 2.3 11.9 11.3 PENSION AND POSTRETIREMENT EXPENSE 1 0.4 0.3 0.8 0.7 NON-GAAP OPERATING PROFIT $ 36.8 $ 29.3 $ 48.7 $ 63
Slide 24: Adjusted EBITDA Reconciliation
Adjusted EBITDA Reconciliation $M 2Q25 2Q24 YTD25 YTD24 N E T LOSS AT T RIB UT AB LE T O UN ISYS CORPOR A T I ON ($ 20.1) ($ 12.0) ($ 49.6) ($ 161.5) N E T IN COME (LOSS) AT T RIB UT AB LE T O N ON CON T ROLLIN G IN T E RE ST S 0.1 (0.5) (1.0) (0.3) IN T E RE ST E X PE N SE , N E T OF IN T E RE ST I
Slide 25: Non-GAAP Net Income
Non-GAAP Net Income $M EXCEPT SHARE AND PER SHARE DATA 2Q25 2Q24 YTD25 YTD24 N E T L O SS ATTRIBUTA BL E TO UN ISYS CO RP O RATIO N ($ 20.1) ($ 12.0) ($ 49.6) ($ 161.5) PE N SION & POST RE T IR E ME N T E X PE N SE PRE T AX 22.0 12.4 43.9 159.0 T AX 0.6 0.1 1.2 0.2 N E T O F TAX $ 21.4 $ 12.3 $ 42.7
Slide 26: Non-GAAP Diluted Earnings Per Share
Non-GAAP Diluted Earnings Per Share $M EXCEPT SHARE AND PER SHARE DATA 2Q25 2Q24 YTD25 YTD24 NON-GAAP NET INCOME ATTRIBUTABLE TO UNISYS CORPORATION $ 13.8 $ 11.0 $ 10.4 $ 13.7 WEIGHTED AVERAGE SHARES (THOUSANDS) 71,261 69,275 70,683 68,990 PLUS INCREMENTAL FROM ASSUMED VESTING OF EMPLOYEE STOCK PLAN
Slide 27: Adjusted Free Cash Flow
Adjusted Free Cash Flow $M 2Q25 2Q24 YTD25 YTD24 CASH (USED FOR) PROVIDED BY OPERATIONS ($ 316.2) $ 2.7 ($ 282.9) $ 26.5 ADDITIONS TO MARKETABLE SOFTWARE (12.4) (12.5) (23.6) (25.7) ADDITIONS TO PROPERTIES AND OTHER ASSETS (7.9) (8.7) (16.8) (15.4) FREE CASH FLOW ($ 336.5) ($ 18.5) ($ 323.3) ($ 14.6
Slide 28: Non-GAAP Net Income (Loss) Margin
Non-GAAP Net Income (Loss) Margin $M 2Q25 2Q24 YTD25 YTD24 REVENUE $ 483.3 $ 478.2 $ 915.4 $ 966.0 NET LOSS ATTRIBUTABLE TO UNISYS CORPORATION ($ 20.1) ($ 12.0) ($ 49.6) ($ 161.5) NON-GAAP NET INCOME ATTRIBUTABLE TO UNISYS $ 13.8 $ 11.0 $ 10.4 $ 13.7 NET LOSS ATTRIBUTABLE TO UNISYS CORPORATION (4.2%
Slide 29: Potential Economic Benefit of Tax Assets (as of December 31, 2024)
Potential Economic Benefit of Tax Assets (as of December 31, 2024) FUTURE AVAILABLE NET DEFERRED TAX $M DESCRIPTION REDUCTIONS IN TAXABLE ASSETS 1 INCOME U.S. NOLS AND TAX CREDITS: NET OPERATING LOSS – FEDERAL & STATE $ 536 $1,617 TAX CREDITS 91 435 PENSION AND OTHER: PENSION 150 600 OTHER DEFERRED
Slide 30: Definitions of Non-GAAP Financial Metrics
Definitions of Non-GAAP Financial Metrics Non-GAAP operating profit –This measure excludes pretax pension and postretirement expense, pretax goodwill impairment charge and pretax charges or gains associated with certain legal matters related to settlements, professional services and legal fees, incl
Slide 31: Definitions of Other Metrics
Definitions of Other Metrics License and Support (L&S) – Represents software license and related support services, primarily ClearPath Forward®, within the company's ECS segment. Excluding License and Support (Ex-L&S) – These measures exclude revenue, gross profit and gross profit margin in connecti
Unisys Corporation New — Q2 2025 Earnings Presentation on 6ix