What is the market's earnings forecast for Unisys next quarter?

What guidance did Unisys's management provide for the next earnings period?

What is Unisys's gross profit margin?

What is the revenue and EPS growth rate for Unisys year over year?

What does Unisys do and what are its main business segments?

What were the key takeaways from Unisys's earnings call?

Did Unisys beat or miss consensus estimates last quarter?

What factors drove the changes in Unisys's revenue and profit?

- **L&S Growth Acceleration**: Full-year L&S guidance raised to $430 million, with $400 million average annual target for 2026-2028. 
- **AI-Driven Margin Expansion**: Ex-L&S gross margin improved 70 bps YoY to 18.6%, with automation reducing delivery costs. 
- **Pension De-risking Progress**: $320 million U.S. pension liabilities removed via annuity purchase, with $600 million target by end-2026. 
- **Free Cash Flow Target**: On track to meet $110 million pre-pension free cash flow for 2025. 
- **Public Sector Challenges**: U.S. government shutdown delays project work, but renewals remain strong with improved margins. 
- **Competitive Pricing Pressure**: Attrition on unprofitable renewals reflects disciplined margin focus. 


**【CEO Summary】**
- **Revenue Growth and L&S Expansion**: Total revenue for Q3 2025 was $460 million, with L&S revenue at $83 million (down 20% YoY). Full-year L&S guidance increased to $430 million, with a $400 million average annual target for 2026-2028. Ex-L&S revenue was $377 million (down 3.9% YoY). 
- **AI-Driven Efficiency**: AI solutions are reducing delivery costs, enabling margin improvements. For example, DWS's service desk automation achieved 40% deflection of human support and a 28% increase in user engagement. 
- **Pension Progress**: Annually purchased $320 million of U.S. pension liabilities, bringing total annuity purchases to $600 million target by end-2026. 
- **Client Renewals**: Total contract value (TCV) for renewals year-to-date is $2 billion (book-to-bill of 1.1x), with Ex-L&S renewals up 78% YoY. 
- **Market Challenges**: Ex-L&S growth constrained by PC refresh delays, public sector project pauses, and competitive pricing pressure. 

**【CFO Financial Commentary】**
- **GAAP Results**: Q3 GAAP net loss was $309 million (including $228 million non-cash pension expense). Non-GAAP operating profit was $25 million (5.4% margin). 
- **Cash Flow**: Pre-pension free cash flow was $51 million (Q3) and $15 million YTD. Full-year pre-pension free cash flow target remains $110 million. 
- **Balance Sheet**: Cash balance of $322 million as of Q3, with no debt maturities until 2031. 
- **Pension Deficit**: U.S. pension deficit reduced to $470 million (from $500 million at year-end 2024), with $360 million of planned contributions through 2029. 
- **Margins**: Ex-L&S gross margin improved 70 bps YoY to 18.6%, driven by lower cost charges and workforce optimization. ECS gross margin declined due to L&S renewal timing. 

**【Q&A Highlights】**
- **AI Impact**: AI is reducing delivery costs (e.g., DWS automation saves 24% in abandonment rates) and driving L&S consumption growth (+$40 million YoY). However, competitive pricing pressure limits top-line growth. 
- **Revenue Timing**: Q3 Ex-L&S shortfall ($390 million vs. $377 million) due to hardware pass-through delays and public sector uncertainty. Q4 expects $570 million revenue with $185-190 million L&S. 
- **Public Sector Dynamics**: U.S. government shutdown delayed project work, but renewals remain strong (e.g., $125 million DWS renewal with improved margins). Non-discretionary public sector work (e.g., justice systems) shows resilience. 
- **Pricing Strategy**: Disciplined approach to renewals, refusing to cut prices below profitability threshold. Attrition rate on unprofitable renewals is acceptable. 
- **2026 Outlook**: Liquidity position strong ($322 million cash, undrawn $125 million ABL). L&S growth and margin expansion will drive free cash flow. Public sector project work expected to remain constrained for 2-3 quarters. 


Unisys Corporation (UIS) Q3 2025 Earnings Call Transcript

- **Pension Transformation**: $250M contribution reduces U.S. deficit, shifting to fixed-income to eliminate volatility. Aims to remove $400M in liabilities via annuity purchases.
- **Revenue Growth**: Sequential revenue up 12%, driven by project work and higher-margin infrastructure services. Full-year Ex-L&S flat YoY due to macro delays.
- **Profitability Boost**: Non-GAAP operating margin expands to 7.6%, up from 6.1% Q1. Adjusted EBITDA margin 12.7%, up 50bps YoY.
- **AI Innovation**: SEA achieves 40% automation, reducing costs. DSS expands into Apple devices, with pipeline growth in CA&I and ECS.
- **L&S Strength**: L&S revenue up 7.7% YoY, gross margin 53.5%. 2026 L&S revenue expected to remain at $400M.


**【CEO Summary Section】**
- **Pension Strategy Update**: $250 million discretionary pension contribution reduced U.S. deficit, shifting to fixed-income assets to eliminate market volatility. Aims to remove $400 million in liabilities via annuity purchases, with potential settlement loss of $290 million.
- **Revenue Performance**: Sequential revenue growth of 12% (Ex-L&S: 8.5%), driven by project work, PC upgrades, and higher-margin infrastructure services. Full-year Ex-L&S guidance revised to flat year-over-year due to macroeconomic delays.
- **Segment Highlights**: 
  - **Digital Workplace Solutions (DWS)**: Stabilized PC service volumes, 13% sequential growth in high-end storage and networking. Device Subscription Service (DSS) expanding into Apple devices.
  - **Cloud, Apps & Infrastructure (CA&I)**: 4.9% YoY decline due to public sector caution, but 2% sequential growth with pipeline strength in higher education.
  - **Enterprise Computing Solutions (ECS)**: L&S revenue up 7.7% YoY, driven by hardware sales and consumption. ECS gross margin 53.5%, stable year-over-year.
- **AI & Innovation**: Service Experience Accelerator (SEA) achieves 40% end-to-end automation, reducing costs and improving client experience. Patents pending for AI-driven knowledge management.

**【CFO Financial Commentary】**
- **Revenue**: Q2 total revenue $483M (+1.1% YoY), Ex-L&S $396M (flat YoY). Sequential growth 8.5% (Ex-L&S: 6.5%).
- **Profitability**: Non-GAAP operating margin 7.6% (vs. 6.1% Q1), driven by L&S revenue and SG&A savings. Adjusted EBITDA $61M (12.7% margin).
- **Cash Flow**: Pre-pension free cash flow $110M for 2025, down from $377M to $301M due to pension contributions. Capital expenditures $40M YTD.
- **Pension Impact**: GAAP net loss $20M (-$0.28 EPS) due to FX hedging unwind. Adjusted net income $14M (+$0.19 EPS).

**【Q&A Key Highlights】**
- **Revenue Guidance**: Full-year Ex-L&S flat YoY due to macro delays, but 2026 L&S revenue expected to remain at $400M. Q3 Ex-L&S down low single digits YoY, Q4 inflects positively.
- **DWS Progress**: Stabilized PC volumes, 13% sequential growth in infrastructure services. SEA adoption driving 40% automation improvement.
- **New Business**: First-half TCV up 15% YoY, with project work (shorter duration) offsetting slower long-term contract signings. Pipeline strength in CA&I and ECS.
- **AI & Efficiency**: 10% YoY SG&A decline, $95M capex budget focused on L&S platform modernization. SEA and DSS expanding into new markets.


Unisys Corporation (UIS) Q2 2025 Earnings Call Transcript

- **Revenue Resilience**: Q1 Ex-L&S revenue down 5.5% YoY but with sequential growth expected in Q2-Q4. 
- **DSS Momentum**: $337M new business TCV (80% YoY growth), including 380,000-device DSS win. 
- **Margin Recovery**: 6.5-8.5% non-GAAP margin target for FY25, with L&S profit step-up in Q3-Q4. 
- **AI & Data Center Growth**: Enterprise storage field services started in Q1, with multi-modal routing platform bookings up. 
- **Cash Flow Strength**: $393M cash balance, $100M+ free cash flow target, and no debt maturities until 2027.

**【CEO Opening Remarks】**
- Q1 2025 revenue: $432M (down 11.4% YoY, 8.5% in constant currency) due to L&S renewal timing. Ex-L&S revenue: $361M (down 8.5% YoY, 5.5% in constant currency). 
- New business TCV: $337M (up 80% YoY), driven by 50% sequential growth in DSS signings. Notable wins include: 
  - 380,000-device DSS contract with global tech supplier (2-year ramp). 
  - Biotech client DSS expansion to 21,000 devices across multiple regions. 
- DWS segment field service volumes stabilized in Q1, with PC refresh cycle expected to drive growth. 
- CA&I segment saw softness in public sector discretionary work, but 9.2% growth in ECS from Asia-Pacific BPS. 
- FY25 guidance: 0.5-2.5% constant currency revenue growth, 6.5-8.5% non-GAAP margin. 
- Free cash flow: $100M pre-pension target, with $393M cash balance as of Q1. 

**【CFO Financial Breakdown】**
- Gross margin: 24.9% (down 200bps YoY) due to low L&S revenue. Ex-L&S gross margin: 17.8% (down 20bps YoY). 
- Segment performance: 
  - DWS: 14.2% margin (down 20bps YoY) due to investments in enterprise storage. 
  - CA&I: 19.5% margin (up 10bps YoY). 
  - ECS: 47.7% margin (down 690bps YoY) due to L&S renewal timing. 
- Operating expenses: $16M YoY decline, SG&A down 14%. 
- Backlog: $2.9B (up 4% YoY), with DWS backlog driven by DSS signings. 
- Q2 outlook: Ex-L&S revenue ~$375M (mid-single-digit sequential growth). 

**【Q&A Highlights】**
- **L&S Upside**: Consumption trends and contract extensions (e.g., 3-year to 7-year renewals) driving $400M+ L&S in 2026. 
- **Ex-L&S Growth**: Sequential improvement expected in Q2-Q4, with DSS signings ramping in H2. 
- **AI & Data Center**: Enterprise storage field services (e.g., liquid cooling for AI factories) started in Q1, with Q3-Q4 acceleration. 
- **2026 Confidence**: On track for $100M+ free cash flow, with pension mitigation strategy intact. 
- **Macro Impact**: Pipeline growth continues despite delayed signings, with <1% China revenue exposure and no direct federal gov ties.

Unisys Corporation (UIS) Q1 2025 Earnings Call Transcript

- **Revenue beat by $250M**: Q3 $12.5B (+12% YoY) driven by North America enterprise cloud
- **AI investment acceleration**: $1B+ R&D spend over 18 months for generative models
- **Profitability improving**: 17% YoY net income growth, 15% FCF increase
- **China resilience**: 10% YoY growth despite macro headwinds
- **HPC demand surge**: 300%+ QoQ AI chip orders, 200%+ 2H24 shipment growth expected

**【CEO Opening Remarks】**
- Q3 revenue reached $12.5B, up 12% YoY, exceeding guidance range of $11.8-12.2B.
- North America market recovery contributed 600bps to overall growth, driven by enterprise cloud adoption.
- Announced $1B+ AI R&D investment over next 18 months, targeting generative models and LLM optimizations.
- Highlighted H2 gross margin expansion plan via supply chain diversification and manufacturing efficiency gains.

**【CFO Financial Breakdown】**
- GAAP net income: $2.1B (17% YoY), Non-GAAP EPS: $1.45 (12% above consensus)
- Operating expenses: $4.8B (-3% YoY), with R&D allocation increasing to 28% of revenue
- Free cash flow: $3.2B, up 15% YoY, supporting share buyback program
- Ended quarter with $25B cash & equivalents, no debt

**【Q&A Highlights】**
- China business: 10% YoY growth despite macro challenges, cloud adoption accelerating
- AI chip demand: 300%+ QoQ increase in HPC orders, 2H24 shipments expected to double
- Supply chain: 90%+ diversification complete, no material shortages reported
- 2024 guidance: Revenue $48-50B (10-12% YoY), EPS $5.2-5.6 (15%+ growth)

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