Unisys Corporation (NYSE: UIS) announced its financial results for the second quarter of 2026 (2Q26) on July 29, 2026, showcasing a blend of positive and negative indicators as the company progresses through the fiscal year. CEO Michael Thomson expressed optimism about the company's performance, emphasizing improved client engagement and strong new business signings.

1. Performance Overview

In his opening remarks, Thomson stated, "The year is progressing well, with our strong second quarter performance building on the good start we had in the first quarter." He highlighted the company's commitment to an AI-First strategy as a core component of its business model, aimed at fostering future growth and operational efficiency.

Financial Highlights

Unisys reported total revenue of $473.5 million for 2Q26, reflecting a 2.0% decline compared to $483.3 million in the same quarter last year. The revenue decrease was steeper at 5.2% when adjusted for constant currency effects.

Financial Metric	2Q26	2Q25	Year-Over-Year Change
Revenue	$473.5M	$483.3M	-2.0%
Gross Profit	$117.3M	$130.0M	-11.0%
Operating Loss	($32.9M)	$30.3M	N/A
Net Loss	($95.3M)	($20.1M)	N/A

The decrease in revenue was primarily attributed to the timing of ClearPath license renewals, which had a notable impact on both revenue and gross profit margins.

Segmented Performance

Unisys reported its revenue by segment, highlighting mixed results across its divisions:

Technology Solutions & Services (TS&S):

Revenue: $403.8 million, up 2.0% YoY.

Gross Profit Margin: 19.3%, an increase from last year's 17.6%.

ClearPath Revenue:

Revenue: $69.7 million, down 20.4% YoY.

Gross Profit Margin: 56.7%, a decrease from 68.8% in the previous year.

Digital Workplace Solutions (DWS):

Revenue: $141.9 million, slightly up 2.8% YoY.

Gross Profit Margin: 10.8%, down significantly from 16.9% YoY.

Cloud, Applications & Infrastructure Solutions (CA&I):

Revenue: $184.4 million, a minor decline of 0.4% YoY, with margins improving to 25.0% from 20.8%.

Enterprise Computing Solutions (ECS):

Revenue: $126.0 million, a decline of 10.1% YoY.

Gross Profit Margin: 44.8%, down from 53.5%.

2. Cost and Profitability Metrics

Despite the growth in TS&S, Unisys faced challenges in overall profitability, reporting an operating loss of $32.9 million for the quarter, which included a non-cash goodwill impairment charge of $47.2 million related to the DWS segment. This impairment represented the complete write-off of the remaining goodwill balance allocated to DWS.

Cash Flow and Balance Sheet

Cash and cash equivalents stood at $324.3 million, down from $413.9 million at the end of 2025. Unisys reported cash used in operations of $26.3 million, markedly improved from $316.2 million used in the same quarter of the previous year.

Free Cash Flow

The company reported a free cash flow of ($49.0 million), a notable improvement over ($336.5 million) in 2Q25. The adjusted free cash flow was ($9.4 million), demonstrating a positive trend in cash management.

3. Future Outlook

Unisys reaffirmed its full-year 2026 revenue growth guidance, maintaining a constant currency revenue growth forecast of (5.0)% to (3.5)%. The guidance translates to reported revenue growth of (2.6)% to (1.1)% based on current exchange rates. The firm anticipates ClearPath revenue of approximately $425 million and a constant currency revenue growth for TS&S of (6.0)% to (4.0)%.

4. Conclusion

While Unisys faces challenges in certain areas, particularly in ClearPath renewals and overall profitability, the company is taking steps to stabilize its financial performance and reposition itself for future growth. The focus on AI and improved client engagement could prove advantageous as the year progresses. Investors and stakeholders are encouraged to join the conference call scheduled for July 30, 2026, for further insights into the company's strategy and performance.

Original press release