Prysmian's Q1 EBITDA Surge Signals Resurgence in Global Infrastructure Spending

Prysmian Group, the world’s leading cable solutions provider, has delivered a robust start to 2025, reporting an adjusted EBITDA of €527 million for the first quarter—a 15% increase compared to the estimated €457.7 million in Q1 2024. The results, driven by strong revenue growth and margin expansion, underscore the company’s resilience amid macroeconomic challenges and its strategic positioning in high-demand sectors like renewable energy and smart infrastructure.

The rise in EBITDA is particularly notable given the backdrop of lingering inflationary pressures and supply chain disruptions. Prysmian’s revenue for Q1 2025 reached €4.032 billion, a 9.3% year-over-year increase from €3.687 billion in Q1 2024. While revenue growth is impressive, the margin improvement from 12.4% to 13.1% highlights operational efficiency gains. This expansion suggests Prysmian is successfully navigating cost pressures and securing higher-margin contracts, a critical factor in sustaining profitability in cyclical industries.

The margin improvement, however, comes with caveats. The 2024 EBITDA figure was calculated using "standard metal prices," a key adjustment factor that normalizes results for fluctuations in raw material costs. This adjustment is critical because metal prices, a significant input for cable manufacturing, can skew profitability in volatile markets. By standardizing for these variables, Prysmian’s results reflect genuine operational improvements rather than commodity-driven anomalies.

The company’s regional and segment performance further reveals its growth drivers. In EMEA, revenue rose 8% year-over-year, fueled by demand for grid modernization and offshore wind projects. The Americas saw a 15% revenue surge, driven by U.S. infrastructure spending and Latin American energy investments. Meanwhile, Asia-Pacific grew by 5%, though slower expansion there may reflect lingering post-pandemic supply chain bottlenecks.

Prysmian’s success is also tied to its strategic focus on high-margin segments like power grids and renewables. The Power Grids & Renewables division, which includes cables for offshore wind farms and subsea interconnectors, reported a 14% revenue increase. This division now accounts for 56% of total revenue, up from 53% in 2024, signaling a deliberate shift toward sectors with long-term growth trajectories.

Investors should also note the company’s balance sheet health. Despite rising working capital needs due to increased production, Prysmian’s net debt-to-EBITDA ratio remained stable at 1.6x, well within its target range. This financial flexibility positions the company to capitalize on opportunities in greenfield projects and acquisitions, though management has emphasized disciplined capital allocation.

The question remains: Can this momentum endure? Prysmian’s management has guided for full-year revenue growth of 5-7%, with margin expansion sustained through cost discipline and pricing power. The company’s order backlog of €19.1 billion as of March 2025—up 11% year-over-year—supports this outlook, particularly in renewables and utilities.

Yet risks linger. A slowdown in global infrastructure spending or a sharp decline in metal prices (which could pressure margins anew) could test Prysmian’s trajectory. Geopolitical tensions, such as the ongoing Russia-Ukraine war, also pose supply chain and cost risks.

In conclusion, Prysmian’s Q1 results reflect a company well-positioned to benefit from secular trends in energy transition and grid modernization. With margin expansion proving sustainable and revenue growth outpacing peers, the stock (PRY.MI) appears attractively valued at 13x trailing EBITDA—a discount to historical averages. Provided macroeconomic headwinds ease, Prysmian’s leadership in critical infrastructure could translate into multiyear outperformance. For investors betting on the energy transition, this quarter’s results are a compelling signal of the company’s staying power.

The numbers tell a clear story: Prysmian is not just weathering the storm—it’s building the infrastructure to power the next one.