Unisys (UIS) Q2 2026 earnings summary

Executive summary

• Revenue for Q2 2026 was $473.5 million, down 2.0% year-over-year, mainly due to the timing of ClearPath license renewals, while TS&S revenue grew 2.0% and new business TCV increased 57% year-over-year.

• Gross profit margin decreased 210 basis points year-over-year to 24.8%, primarily due to ClearPath renewal timing, but TS&S gross margin expanded 170 basis points to 19.3%.

• Net loss attributable to shareholders was $95.3 million for Q2 2026, significantly impacted by a $47.2 million non-cash goodwill impairment in the DWS segment.

• The company reaffirmed its 2026 full-year guidance for revenue decline of (5.0)% to (3.5)% in constant currency and non-GAAP operating profit margin of 9.0% to 11.0%.

• Free cash flow was negative $49 million, a significant improvement from the prior year period, with cash and equivalents at $324.3 million at quarter-end.

Financial highlights

• Q2 2026 revenue: $473.5 million (down 2.0% YoY); TS&S revenue: $403.8 million (up 2.0% YoY); ClearPath revenue: $69.7 million (down 20.4% YoY).

• Gross profit: $117.3 million (24.8% margin); adjusted EBITDA: $53.5 million (11.3% margin); non-GAAP operating profit: $25.3 million (5.3% margin).

• Net loss attributable to the company: $95.3 million; non-GAAP net loss: $5.7 million; non-GAAP diluted EPS: ($0.08).

• Free cash flow: -$49 million; cash and cash equivalents: $324.3 million at June 30, 2026.

• Backlog at quarter-end: $2.8 billion; book-to-bill ratio: 1.2x.

Outlook and guidance

• Full-year 2026 revenue guidance reaffirmed at a decline of (5.0)% to (3.5)% in constant currency, or (2.6)% to (1.1)% as reported.

• TS&S revenue expected to decline (6.0)% to (4.0)% in constant currency; ClearPath revenue guided to approximately $425 million for the year.

• Non-GAAP operating profit margin guidance of 9.0% to 11.0% for the full year.

• Free cash flow for 2026 expected to be around ($25 million); capital expenditures of ~$85 million and pension contributions of ~$100 million.

• Management expects to meet all debt covenants and liquidity needs for at least the next 12 months.