UNISYS CORP 10-Q

Item 1. Financial Statements UNISYS CORPORATION CONSOLIDATED STATEMENTS OF INCOME (LOSS) (Unaudited) (Millions, except per share data) Three Months Ended June 30, Six Months Ended June 30, 2025 2024 2025 2024 Revenue Services $ 412.2 $ 416.1 $ 798.4 $ 832.9 Technology 71.1 62.1 117.0 133.1 483.3 478.2 915.4 966.0 Costs and expenses Cost of revenue Services 299.3 312.1 589.7 627.0 Technology 54.0 36.2 88.2 73.1 353.3 348.3 677.9 700.1 Selling, general and administrative 93.6 101.4 190.4 213.6 Research and development 6.1 4.9 11.7 11.0 453.0 454.6 880.0 924.7 Operating income 30.3 23.6 35.4 41.3 Interest expense 8.2 7.9 16.4 15.8 Other (expense), net ( 22.1 ) ( 9.4 ) ( 39.0 ) ( 151.5 ) Earnings (loss) before income taxes — 6.3 ( 20.0 ) ( 126.0 ) Provision for income taxes 20.0 18.8 30.6 35.8 Consolidated net loss ( 20.0 ) ( 12.5 ) ( 50.6 ) ( 161.8 ) Net income (loss) attributable to noncontrolling interests 0.1 ( 0.5 ) ( 1.0 ) ( 0.3 ) Net loss attributable to Unisys Corporation $ ( 20.1 ) $ ( 12.0 ) $ ( 49.6 ) $ ( 161.5 ) Loss per share attributable to Unisys Corporation Basic $ ( 0.28 ) $ ( 0.17 ) $ ( 0.70 ) $ ( 2.34 ) Diluted $ ( 0.28 ) $ ( 0.17 ) $ ( 0.70 ) $ ( 2.34 ) See notes to consolidated financial statements 4 UNISYS CORPORATION CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) (Unaudited) (Millions) Three Months Ended June 30, Six Months Ended June 30, 2025 2024 2025 2024 Consolidated net loss $ ( 20.0 ) $ ( 12.5 ) $ ( 50.6 ) $ ( 161.8 ) Other comprehensive (loss) income Foreign currency translation 94.3 ( 19.9 ) 139.3 ( 35.3 ) Pension and postretirement adjustments, net of tax of $( 10.8 ) and $( 15.7 ) in 2025 and $ 1.1 and $ 3.9 in 2024 ( 29.6 ) 12.1 ( 32.3 ) 166.0 Total other comprehensive income (loss) 64.7 ( 7.8 ) 107.0 130.7 Comprehensive income (loss) 44.7 ( 20.3 ) 56.4 ( 31.1 ) Less comprehensive income (loss) attributable to noncontrolling interests 0.9 ( 0.3 ) 0.5 0.1 Comprehensive income (loss) attributable to Unisys Corporation $ 43.8 $ ( 20.0 ) $ 55.9 $ ( 31.2 ) See notes to consolidated financial statements 5 UNISYS CORPORATION CONSOLIDATED BALANCE SHEETS (Unaudited) (Millions) June 30, 2025 December 31, 2024 Assets Current assets: Cash and cash equivalents $ 300.8 $ 376.5 Accounts receivable, net 454.9 467.2 Contract assets 14.9 16.0 Inventories 27.8 16.4 Prepaid expenses and other current assets 97.3 103.2 Total current assets 895.7 979.3 Properties 398.1 396.2 Less-accumulated depreciation and amortization 341.5 339.1 Properties, net 56.6 57.1 Capitalized contract costs, net 32.7 31.2 Marketable software, net 163.1 165.0 Operating lease right-of-use assets 44.6 38.4 Prepaid pension and postretirement assets 30.6 25.6 Deferred income taxes 106.9 96.6 Goodwill 248.9 247.9 Intangible assets, net 33.4 35.5 Restricted cash 8.2 14.1 Other long-term assets 175.9 181.6 Total assets $ 1,796.6 $ 1,872.3 Total liabilities and deficit Current liabilities: Current maturities of long-term debt $ 5.7 $ 5.0 Accounts payable 92.7 97.9 Deferred revenue 220.2 210.4 Other accrued liabilities 221.2 314.7 Total current liabilities 539.8 628.0 Long-term debt 692.7 488.2 Long-term pension and postretirement liabilities 551.9 816.4 Long-term deferred revenue 106.3 108.8 Long-term operating lease liabilities 35.1 28.9 Other long-term liabilities 77.7 71.3 Commitments and contingencies (see Note 12) Deficit: Common stock; Issued: June 30, 2025 - 78.0 shares and December 31, 2024 - 75.6 shares 0.8 0.8 Accumulated deficit ( 2,188.7 ) ( 2,139.1 ) Treasury stock, shares at cost; June 30, 2025 - 6.7 shares and December 31, 2024 - 6.0 shares ( 161.8 ) ( 158.5 ) Paid-in capital 4,779.9 4,770.6 Accumulated other comprehensive loss ( 2,651.7 ) ( 2,757.2 ) Total Unisys Corporation stockholders' deficit ( 221.5 ) ( 283.4 ) Noncontrolling interests 14.6 14.1 Total deficit ( 206.9 ) ( 269.3 ) Total liabilities and deficit $ 1,796.6 $ 1,872.3 See notes to consolidated financial statements 6 UNISYS CORPORATION CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) (Millions) Six Months Ended June 30, 2025 2024 Cash flows from operating activities Consolidated net loss $ ( 50.6 ) $ ( 161.8 ) Adjustments to reconcile consolidated net loss to net cash (used for) provided by operating activities: Loss on debt extinguishment 6.8 — Foreign currency (gains) losses ( 2.3 ) 12.6 Employee stock compensation 9.7 11.4 Depreciation and amortization of properties 12.0 12.1 Depreciation and amortization of capitalized contract costs 7.5 12.6 Amortization of marketable software 27.0 24.2 Amortization of intangible assets 2.1 4.6 Other non-cash operating activities 2.1 ( 0.4 ) Pension and postretirement contributions ( 287.6 ) ( 12.4 ) Pension and postretirement expense 43.9 159.0 Deferred income taxes, net 1.4 0.1 Changes in operating assets and liabilities: Receivables, net and contract assets 49.1 31.9 Inventories ( 11.1 ) ( 1.7 ) Other assets 13.3 ( 13.4 ) Accounts payable and current liabilities ( 111.6 ) ( 59.4 ) Other liabilities 5.4 7.1 Net cash (used for) provided by operating activities ( 282.9 ) 26.5 Cash flows from investing activities Proceeds from foreign exchange forward contracts 1,776.5 1,519.2 Purchases of foreign exchange forward contracts ( 1,746.0 ) ( 1,524.8 ) Investment in marketable software ( 23.6 ) ( 25.7 ) Capital additions of properties and other assets ( 16.8 ) ( 15.4 ) Other ( 0.1 ) ( 0.1 ) Net cash used for investing activities ( 10.0 ) ( 46.8 ) Cash flows from financing activities Proceeds from issuance of long-term debt 700.0 — Payments of long-term debt ( 488.6 ) ( 10.1 ) Issuance costs relating to long-term debt ( 13.8 ) — Cash paid for debt extinguishment ( 4.0 ) — Other ( 3.3 ) ( 1.8 ) Net cash provided by (used for) financing activities 190.3 ( 11.9 ) Effect of exchange rate changes on cash, cash equivalents and restricted cash 21.0 ( 11.8 ) Decrease in cash, cash equivalents and restricted cash ( 81.6 ) ( 44.0 ) Cash, cash equivalents and restricted cash, beginning of period 390.6 396.7 Cash, cash equivalents and restricted cash, end of period $ 309.0 $ 352.7 See notes to consolidated financial statements 7 UNISYS CORPORATION CONSOLIDATED STATEMENTS OF EQUITY (DEFICIT) (Unaudited) (Millions) Unisys Corporation Total Total Unisys Corporation Common Stock Par Value Accumu-lated Deficit Treasury Stock At Cost Paid-in Capital Accumu-lated Other Compre-hensive Loss Non-controlling Interests Balance at December 31, 2024 $ ( 269.3 ) $ ( 283.4 ) $ 0.8 $ ( 2,139.1 ) $ ( 158.5 ) $ 4,770.6 $ ( 2,757.2 ) $ 14.1 Consolidated net loss ( 30.6 ) ( 29.5 ) ( 29.5 ) ( 1.1 ) Stock-based activity 3.5 3.5 — ( 2.8 ) 6.3 Translation adjustments 45.0 42.2 42.2 2.8 Pension and postretirement plans ( 2.7 ) ( 0.6 ) ( 0.6 ) ( 2.1 ) Balance at March 31, 2025 $ ( 254.1 ) $ ( 267.8 ) $ 0.8 $ ( 2,168.6 ) $ ( 161.3 ) $ 4,776.9 $ ( 2,715.6 ) $ 13.7 Consolidated net loss ( 20.0 ) ( 20.1 ) ( 20.1 ) 0.1 Stock-based activity 2.5 2.5 ( 0.5 ) 3.0 Translation adjustments 94.3 88.8 88.8 5.5 Pension and postretirement plans ( 29.6 ) ( 24.9 ) ( 24.9 ) ( 4.7 ) Balance at June 30, 2025 $ ( 206.9 ) $ ( 221.5 ) $ 0.8 $ ( 2,188.7 ) $ ( 161.8 ) $ 4,779.9 $ ( 2,651.7 ) $ 14.6 Unisys Corporation Total Total Unisys Corporation Common Stock Par Value Accumu-lated Deficit Treasury Stock At Cost Paid-in Capital Accumu-lated Other Compre-hensive Loss Non-controlling Interests Balance at December 31, 2023 $ ( 138.4 ) $ ( 151.8 ) $ 0.7 $ ( 1,945.7 ) $ ( 156.4 ) $ 4,749.9 $ ( 2,800.3 ) $ 13.4 Consolidated net (loss) income ( 149.3 ) ( 149.5 ) ( 149.5 ) 0.2 Stock-based activity 4.4 4.4 0.1 ( 1.6 ) 5.9 Translation adjustments ( 15.4 ) ( 14.7 ) ( 14.7 ) ( 0.7 ) Pension and postretirement plans 153.9 153.0 153.0 0.9 Balance at March 31, 2024 $ ( 144.8 ) $ ( 158.6 ) $ 0.8 $ ( 2,095.2 ) $ ( 158.0 ) $ 4,755.8 $ ( 2,662.0 ) $ 13.8 Consolidated net loss ( 12.5 ) ( 12.0 ) ( 12.0 ) ( 0.5 ) Stock-based activity 4.5 4.5 ( 0.2 ) 4.7 Translation adjustments ( 19.9 ) ( 20.0 ) ( 20.0 ) 0.1 Pension and postretirement plans 12.1 12.0 12.0 0.1 Balance at June 30, 2024 $ ( 160.6 ) $ ( 174.1 ) $ 0.8 $ ( 2,107.2 ) $ ( 158.2 ) $ 4,760.5 $ ( 2,670.0 ) $ 13.5 See notes to consolidated financial statements 8 UNISYS CORPORATION NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) (Dollars in millions, except share and per share amounts) Note 1 - Basis of Presentation The unaudited consolidated financial statements included in this Quarterly Report on Form 10-Q have been prepared pursuant to the rules and regulations of the U.S. Securities and Exchange Commission (SEC). These rules and regulations permit some of the information and footnote disclosures normally included in financial statements, prepared in accordance with generally accepted accounting principles in the United States of America (GAAP), to be condensed or omitted. In management’s opinion, the unaudited consolidated financial statements contain all adjustments that are of a normal recurring nature, necessary for a fair presentation of the results of operations and financial position of the company for the interim periods presented. These adjustments consist only of normal recurring accruals except as disclosed herein. Because of seasonal and other factors, results for interim periods are not necessarily indicative of the results to be expected for the full year. These unaudited consolidated financial statements should be read in conjunction with the audited consolidated financial statements for the fiscal year ended December 31, 2024 and the notes thereto included in the company’s Annual Report on Form 10-K, filed with the SEC. Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions about future events. These estimates and assumptions affect the amounts of assets and liabilities reported, disclosures about contingent assets and liabilities and the reported amounts of revenue and expenses. Such estimates include the valuation of estimated credit losses, contract assets, operating lease right-of-use assets, capitalized contract costs assets, marketable software, goodwill, purchased intangibles and other long-lived assets, legal and environmental contingencies, assumptions used in the calculation for systems integration projects, income taxes and retirement and other post-employment benefits, among others. These estimates and assumptions are based on management’s best estimates and judgment. Management evaluates its estimates and assumptions on an ongoing basis using historical experience and other factors, including the current economic environment, which management believes to be reasonable under the circumstances. Management adjusts such estimates and assumptions when facts and circumstances dictate. As future events and their effects cannot be determined with precision, actual results could differ materially from these estimates. Any changes in those estimates resulting from changes in the economic environment such as inflation, tariffs, trade policy, fluctuation in interest rates and foreign exchange rates and conflicts, wars and other events of geopolitical significance, will be reflected in the financial statements in future periods. The company’s accounting policies are set forth in detail in Note 1 of the Notes to Consolidated Financial Statements in the company’s Annual Report on Form 10-K for the year ended December 31, 2024 filed with the SEC. Such Annual Report also contains a discussion of the company’s critical accounting policies and estimates. The company believes that these critical accounting policies and estimates affect its more significant estimates and judgments used in the preparation of the company’s consolidated financial statements. Reclassifications Certain prior period amounts in the consolidated financial statements and accompanying notes have been reclassified to conform to the current period presentation. Note 2 - Accounting Standards Accounting Pronouncements Adopted Effective for the company’s fiscal year ended December 31, 2024 and interim periods thereafter, the company adopted Accounting Standards Update (ASU) No. 2023-07, Segment Reporting (Topic 280) - Improvements to Reportable Segment Disclosures (ASU 2023-07), issued by the Financial Accounting Standards Board (FASB), which enhances reportable segment disclosure requirements including disclosures about significant segment expenses on an annual and interim basis. The adoption of ASU 2023-07 did not have a material impact to the company’s consolidated financial statements. The required interim and annual disclosures were applied to the presentation of the company’s reportable segments, see Note 15, Segment Information. Prior period reportable segment disclosures have been reclassified to be comparable to the current year presentation. Accounting Pronouncements Not Yet Adopted In December 2023, the FASB issued ASU No. 2023-09, Income Taxes (Topic 740) - Improvements to Income Tax Disclosures (ASU 2023-09), which enhances disclosures relating to the rate reconciliation and requires income taxes paid disclosures disaggregated by jurisdiction among other amendments. This update is effective for annual periods beginning after December 9 15, 2024, with early adoption permitted and should be applied on a prospective basis with a retrospective application permitted. ASU 2023-09 is not expected to have a material effect on the company’s consolidated financial statements. In November 2024, the FASB issued ASU No. 2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (ASU 2024-03) requiring additional disclosures about certain costs and expenses in the notes to the financial statements on an annual and interim basis. This update is effective for fiscal years beginning after December 15, 2026, and interim periods within fiscal years beginning after December 15, 2027, with early adoption permitted on either a prospective or retrospective basis. ASU 2024-03 is not expected to have a material effect on the company’s consolidated financial statements. Note 3 - Pension and Postretirement Benefits Net periodic pension expense (income) is presented below: Three Months Ended June 30, 2025 Three Months Ended June 30, 2024 Total U.S. Plans International Plans Total U.S. Plans International Plans Service cost (i) $ 0.3 $ — $ 0.3 $ 0.3 $ — $ 0.3 Interest cost 46.8 27.9 18.9 45.0 28.3 16.7 Expected return on plan assets ( 48.5 ) ( 26.3 ) ( 22.2 ) ( 52.0 ) ( 30.2 ) ( 21.8 ) Amortization of prior service benefit ( 1.2 ) ( 0.7 ) ( 0.5 ) ( 1.1 ) ( 0.6 ) ( 0.5 ) Recognized net actuarial loss 24.5 18.1 6.4 20.4 15.2 5.2 Net periodic pension expense (income) $ 21.9 $ 19.0 $ 2.9 $ 12.6 $ 12.7 $ ( 0.1 ) Six Months Ended June 30, 2025 Six Months Ended June 30, 2024 Total U.S. Plans International Plans Total U.S. Plans International Plans Service cost (i) $ 0.7 $ — $ 0.7 $ 0.6 $ — $ 0.6 Interest cost 92.4 55.8 36.6 92.9 59.3 33.6 Expected return on plan assets ( 95.6 ) ( 52.6 ) ( 43.0 ) ( 108.2 ) ( 64.6 ) ( 43.6 ) Amortization of prior service benefit ( 2.3 ) ( 1.3 ) ( 1.0 ) ( 2.3 ) ( 1.2 ) ( 1.1 ) Recognized net actuarial loss 48.5 36.1 12.4 44.0 33.6 10.4 Settlement losses (ii) — — — 132.3 132.3 — Net periodic pension expense (income) $ 43.7 $ 38.0 $ 5.7 $ 159.3 $ 159.4 $ ( 0.1 ) (i) Service cost is reported in selling, general and administrative expense. All other components of net periodic pension expense are reported in other (expense), net in the consolidated statements of income (loss). (ii) In March 2024, the company purchased a group annuity contract, with plan assets, for approximately $ 195 million to transfer projected benefit obligations related to approximately 3,800 retirees of one of the company’s U.S. defined benefit pension plans. This action resulted in a pre-tax settlement loss of $ 132.3 million for the six months ended June 30, 2024. During the six months ended June 30, 2025, the company made cash contributions of $ 287.2 million to its global defined benefit pension plans including a discretionary contribution of $ 250 million to its U.S. defined benefit pension plans. The discretionary contribution was funded approximately through $ 200 million from the net proceeds of the 10.625 % Senior Secured Notes due 2031, and $ 50 million from cash on hand. See Note 11 for additional details on the issuance and use of the net proceeds of the 10.625 % Senior Secured Notes due 2031. During the six months ended June 30, 2024, the company made cash contributions of $ 10.3 million primarily related to its international defined benefit pension plans. For the remainder of 2025, the company expects to make cash contributions of approximately $ 55 million primarily to its U.S. defined benefit pension plans, resulting in total 2025 expected cash contributions of approximately $ 342 million to its global defined benefit pension plans, which are comprised of approximately $ 314 million for the company’s U.S. defined benefit pension plans and approximately $ 28 million for the company’s international defined benefit pension plans. In 2024, the company made cash contributions of $ 21.9 million primarily to its international defined benefit pension plans. At the end of each year, the company estimates its future cash contributions to its global defined benefit pension plans based on year-end pension data, assumptions and agreements. Any material deterioration in the value of the company’s global defined benefit pension plan assets, as well as changes in pension legislation, volatility in the capital markets, discount rate changes, 10 asset return changes, or changes in economic or demographic trends, could require the company to make cash contributions in different amounts and on a different schedule than previously estimated. Net periodic postretirement benefit expense (income) is presented below: Three Months Ended June 30, Six Months Ended June 30, 2025 2024 2025 2024 Service cost (i) $ 0.1 $ — $ 0.1 $ 0.1 Interest cost 0.6 0.6 1.2 1.2 Expected return on assets — ( 0.1 ) ( 0.1 ) ( 0.1 ) Recognized net actuarial gain ( 0.6 ) ( 0.7 ) ( 1.1 ) ( 1.5 ) Amortization of prior service benefit — — 0.1 — Net periodic postretirement benefit expense (income) $ 0.1 $ ( 0.2 ) $ 0.2 $ ( 0.3 ) (i) Service cost is reported in selling, general and administrative expense. All other components of net periodic postretirement benefit expense (income) are reported in other (expense), net in the consolidated statements of income (loss). The company expects to make cash contributions of $ 3 million to its postretirement benefit plan in 2025. In 2024, the company made cash contributions of $ 5.2 million to its postretirement benefit plan. For the six months ended June 30, 2025 and 2024, the company made cash contributions of $ 0.4 million and $ 2.1 million, respectively. Note 4 - Stock Compensation Under stockholder approved stock-based plans, stock options, stock appreciation rights, restricted stock and restricted stock units (RSUs) may be granted to officers, directors and other key employees. As of June 30, 2025, the company has granted restricted stock and RSUs under these plans. The company recognizes compensation cost, net of a forfeiture rate, in selling, general and administrative expense, and recognizes compensation cost only for those awards expected to vest. The company estimates the forfeiture rate based on its historical experience and its expectations about future forfeitures. During the six months ended June 30, 2025 and 2024, the company recorded $ 9.7 million and $ 11.4 million of share-based restricted stock and RSU compensation expense, respectively. Restricted stock and RSU awards may contain time-based units, performance-based units, total shareholder return market-based units, or a combination of these units. Each performance-based and market-based unit will vest into zero to two shares depending on the degree to which the performance or market conditions are met. Compensation expense for performance-based awards is recognized as expense ratably for each installment from the date of grant until the date the restrictions lapse and is based on the fair market value at the date of grant and the probability of achievement of the specific performance-related goals. Compensation expense for market-related awards is recognized as expense ratably over the measurement period, regardless of the actual level of achievement, provided the service requirement is met. RSU grants for the company’s directors vest upon award and compensation expense for such awards is recognized upon grant. A summary of restricted stock and RSU activity for the six months ended June 30, 2025 follows (shares in thousands): Restricted Stock and RSU Weighted- Average Grant-Date Fair Value Outstanding at December 31, 2024 5,705 $ 6.26 Granted (i) 3,762 4.48 Vested ( 2,421 ) 6.33 Forfeited and expired ( 318 ) 5.37 Outstanding at June 30, 2025 6,728 4.81 11 (i) Awards granted during the six months ended June 30, 2025 were time-based conditions awards. The aggregate weighted-average grant-date fair value of restricted stock and RSUs granted during the six months ended June 30, 2025 and 2024 was $ 15.9 million and $ 19.3 million, respectively. The fair value of awards with time and performance conditions is determined based on the trading price of the company’s common shares on the date of grant. The fair value of awards with market conditions is estimated using a Monte Carlo simulation. As of June 30, 2025, there was $ 19.3 million of total unrecognized compensation cost related to outstanding restricted stock and RSUs granted under the company’s plans. That cost is expected to be recognized over a weighted-average period of 2.1 years. The aggregate weighted-average grant-date fair value of restricted stock and RSUs vested during the six months ended June 30, 2025 and 2024 was $ 15.3 million and $ 12.8 million, respectively. Common stock issued upon the lapse of restrictions on restricted stock and RSUs are newly issued shares. In light of its tax position, the company is currently not recognizing any tax benefits from the issuance of stock upon lapse of restrictions on restricted stock and RSUs. Note 5 - Other (expense), net Other (expense), net is comprised of the following: Three Months Ended June 30, Six Months Ended June 30, 2025 2024 2025 2024 Postretirement expense (i) $ ( 21.6 ) $ ( 12.1 ) $ ( 43.1 ) $ ( 158.3 ) Loss on debt extinguishment ( 6.8 ) — ( 6.8 ) — Foreign exchange gains (losses) (ii) 1.0 2.3 2.3 ( 12.6 ) Other, net (iii) 5.3 0.4 8.6 19.4 Total other (expense), net $ ( 22.1 ) $ ( 9.4 ) $ ( 39.0 ) $ ( 151.5 ) (i) Includes $ 132.3 million of a U.S. pension settlement loss in the six months ended June 30, 2024. See Note 3. (ii) Includes gains (losses) from remeasuring cash, receivables, payables, and intercompany balances in foreign currencies, as well as gains (losses) on foreign exchange forward contracts. See Note 9 for details on the company’s forward contracts. Additionally, foreign exchange gains (losses) includes for the three months ended June 30, 2025 and 2024, net foreign exchange gains of $ 1.6 million and net foreign exchange losses of $ 1.2 million, respectively, related to substantial completion of liquidation of certain foreign subsidiaries and for the six months ended June 30, 2025 and 2024 net foreign currency gains of $ 2.7 million and net foreign currency losses of $ 1.7 million, respectively, related to substantial completion of liquidation of certain foreign subsidiaries. (iii) Other, net includes environmental costs related to previously disposed businesses. Additionally, other, net for the six months ended June 30, 2024 included a net gain of $ 14.9 million related to a favorable judgment received in a Brazilian services tax matter. Note 6 - Income Taxes For the three and six months ended June 30, 2025, the provision for income taxes was $ 20.0 million and $ 30.6 million, respectively, primarily driven by the geographic distribution of income. For the three months ended June 30, 2025, the effective tax rate is not a meaningful measure due to the lack of pre-tax income or loss. For the six months ended June 30, 2025, the effective tax rate was ( 153.0 )%, primarily driven by non-creditable withholding taxes in the U.S., jurisdictions with no valuation allowance that are subject to tax, and U.S. operating losses with no tax benefit as the deferred tax assets are subject to a full valuation allowance. For the three and six months ended June 30, 2024, the provision for income taxes was $ 18.8 million and $ 35.8 million, respectively, primarily driven by geographic distribution of income. For the three and six months ended June 30, 2024, the effective tax rate was 298.4 % and ( 28.4 )%, respectively, primarily driven by U.S. operating losses with no tax benefit as the deferred tax assets are subject to a full valuation allowance, non-creditable withholding taxes in the U.S. and jurisdictions with no valuation allowance that are subject to tax. Accounting rules governing income taxes require that deferred tax assets and liabilities be recognized using enacted tax rates for the effect of temporary differences between the book and tax bases of recorded assets and liabilities. These rules also require that deferred tax assets be reduced by a valuation allowance if it is more likely than not that some portion or the entire deferred tax asset will not be realized. The company evaluates the realizability of its deferred tax assets by assessing its valuation allowance and by adjusting such amount, if necessary. The realization of the company’s net deferred tax assets as of June 30, 2025, is primarily dependent on the ability to generate sustained taxable income in various jurisdictions. Judgment is required to estimate forecasted future taxable income, which may be impacted by future business developments, actual results, strategic operational and tax initiatives, 12 legislative, and other economic factors and developments. It is at least reasonably possible that the company’s judgment about the need for, and level of, existing valuation allowances could change in the near term based on changes in objective evidence such as further sustained income or loss in certain jurisdictions, as well as the other factors discussed above, primarily in certain jurisdictions outside of the United States. As such, the company will continue to monitor income levels and mix among jurisdictions, potential changes to the company’s operating and tax model, and other legislative or global developments in its determination. It is reasonably possible that such changes could result in a material impact to the company’s valuation allowance within the next 12 months. Any increase or decrease in the valuation allowance would result in additional or lower income tax expense in that period and could have a significant impact on that period’s earnings. A full valuation allowance is currently maintained for all U.S. and certain foreign deferred tax assets in excess of deferred tax liabilities. The company will record a tax provision or benefit for those international subsidiaries that do not have a full valuation allowance against their net deferred tax assets. Any profit or loss recorded for the company’s U.S. operations will have no provision or benefit associated with it due to such valuation allowance, except with respect to withholding taxes not creditable against future taxable income. As a result, the company’s provision or benefit for taxes may vary significantly depending on the geographic distribution of income. Under U.S. tax law, distributions from foreign subsidiaries to U.S. stockholders are generally exempt from taxation. Consequently, the deferred income tax liability on undistributed earnings is generally limited to any foreign withholding or other foreign taxes that will be imposed on such distributions. The company is no longer asserting indefinite reinvestment of earnings of certain foreign subsidiaries. At June 30, 2025 and December 31, 2024, the related deferred tax liability was $ 29.8 million and $ 27.7 million, respectively, which is included in other long-term liabilities on the company’s consolidated balance sheets. A corporation’s ability to deduct its federal net operating loss (NOL) carryforwards and utilize certain other available tax attributes can be substantially constrained under the general annual limitation rules of Section 382 of the U.S. Internal Revenue Code (Section 382) if it undergoes an “ownership change” as defined in Section 382 (generally where cumulative stock ownership changes among material stockholders exceed 50 percent during a rolling three-year period). Similar rules may apply under state tax laws. A future tax “ownership change” pursuant to Section 382 or future changes in tax laws that impose tax attribute utilization limitations may severely limit or effectively eliminate the company’s ability to utilize its NOL carryforwards and other tax attributes. On July 4, 2025, the One Big Beautiful Bill Act (OBBBA) was signed into law in the U.S. The OBBBA includes significant provisions, such as the permanent extension of certain expiring provisions of the Tax Cuts and Jobs Act of 2017, modifications to the international tax framework and the restoration of favorable tax treatment for certain business provisions. The legislation has multiple effective dates, with certain provisions effective in 2025 and others implemented through 2027. The company is evaluating the future impact of these tax law changes on the company’s consolidated financial statements. 13 Note 7 - Loss Per Share The following table provides the calculations for the company’s earnings (loss) per common share attributable to Unisys Corporation (shares in thousands): Three Months Ended June 30, Six Months Ended June 30, 2025 2024 2025 2024 Basic loss per common share computation: Net loss attributable to Unisys Corporation $ ( 20.1 ) $ ( 12.0 ) $ ( 49.6 ) $ ( 161.5 ) Weighted average shares 71,261 69,275 70,683 68,990 Basic loss per common share $ ( 0.28 ) $ ( 0.17 ) $ ( 0.70 ) $ ( 2.34 ) Diluted loss per common share computation: Net loss attributable to Unisys Corporation $ ( 20.1 ) $ ( 12.0 ) $ ( 49.6 ) $ ( 161.5 ) Weighted average shares 71,261 69,275 70,683 68,990 Plus incremental shares from assumed vesting of employee stock plans — — — — Adjusted weighted average shares 71,261 69,275 70,683 68,990 Diluted loss per common share $ ( 0.28 ) $ ( 0.17 ) $ ( 0.70 ) $ ( 2.34 ) Anti-dilutive restricted stock units (i) 2,306 1,636 2,885 1,952 (i) Amounts represent shares excluded from the computation of diluted loss per share, as their effect, if included, would have been anti-dilutive for the periods presented. Note 8 - Revenue Contract Assets and Deferred Revenue Contract assets represent rights to consideration in exchange for goods or services transferred to a customer when that right is conditional on something other than the passage of time. Deferred revenue represents contract liabilities. Net contract assets (liabilities) are as follows: June 30, 2025 December 31, 2024 Contract assets - current $ 14.9 $ 16.0 Contract assets - long-term (i) 5.0 6.0 Deferred revenue - current ( 220.2 ) ( 210.4 ) Deferred revenue - long-term ( 106.3 ) ( 108.8 ) (i) Reported in other long-term assets on the company’s consolidated balance sheets. Significant changes in the above contract liability balances were as follows: Three Months Ended June 30, Six Months Ended June 30, 2025 2024 2025 2024 Revenue recognized that was included in deferred revenue at the beginning of the period $ 58.6 $ 58.9 $ 130.0 $ 137.8 14 Capitalized Contract Costs The company’s capitalized contract costs, net include the following: June 30, 2025 December 31, 2024 Deferred commissions, net $ 6.7 $ 7.2 Costs to fulfill a contract, net 16.5 12.9 Other capitalized assets, net 9.5 11.1 Total capitalized contract costs, net $ 32.7 $ 31.2 Deferred commissions, net represent incremental direct costs of obtaining a contract, which are deferred and amortized ratably over the initial contract life. These costs are reported in selling and administrative expense in the company’s consolidated statements of income (loss). Client contract costs are generally expensed as incurred. However, certain costs incurred upon initiation of a client contract (costs to fulfill a contract), principally initial client setup, are capitalized and expensed over the initial contract life. These costs are amortized over the initial contract life and reported in cost of revenue in the company’s consolidated statements of income (loss). The remaining balance of capitalized contract costs, net is comprised of fixed assets and software used in connection with outsourcing contracts. These costs are capitalized and depreciated over the shorter of the initial contract life or in accordance with the company’s fixed asset policy. For the three months ended June 30, 2025 and 2024, amortization expense related to capitalized contract costs assets, net was $ 4.5 million and $ 6.4 million, respectively. For the six months ended June 30, 2025 and 2024, amortization expense related to capitalized contract costs assets, net was $ 7.5 million and $ 12.6 million, respectively. Remaining Performance Obligations Remaining performance obligations represent the transaction price of firm orders for which work has not been performed and excludes (i) contracts with an original expected length of one year or less and (ii) contracts for which the company recognizes revenue at the amount to which it has the right to invoice for services performed. At June 30, 2025, the company had approximately $ 0.9 billion of remaining performance obligations of which approximately 22 % is estimated to be recognized as revenue by the end of 2025, 29 % by the end of 2026, 25 % by the end of 2027, 16 % by the end of 2028 and 8 % thereafter. Note 9 - Financial Instruments and Fair Value Measurements Due to its foreign operations, the company is exposed to the effects of foreign currency exchange rate fluctuations on the U.S. dollar, principally related to intercompany account balances. The company uses derivative financial instruments to reduce its exposure to market risks from changes in foreign currency exchange rates on such balances. The company enters into foreign exchange forward contracts, generally having maturities of three months or less, which have not been designated as hedging instruments. At June 30, 2025 and December 31, 2024, the notional amount of these contracts was $ 556.6 million and $ 501.3 million, respectively. The fair value of these forward contracts is based on quoted prices for similar but not identical financial instruments; as such, the inputs are considered Level 2 inputs. The following table summarizes the fair value of the company’s foreign exchange forward contracts. June 30, 2025 December 31, 2024 Balance Sheet Location Prepaid expenses and other current assets $ 14.2 $ 0.1 Other accrued liabilities 0.2 9.5 Total fair value $ 14.0 $ ( 9.4 ) 15 The following table summarizes the location and amount of gains (losses) recognized on foreign exchange forward contracts. Three Months Ended June 30, Six Months Ended June 30, 2025 2024 2025 2024 Statement of Income Location Other (expense), net $ 38.0 $ ( 5.3 ) $ 53.9 $ ( 17.0 ) Subsequent to June 30, 2025, the company ceased its use of foreign currency forward contracts previously used to reduce its exposure to market risks from changes in foreign currency exchange rates. Financial assets with carrying values approximating fair value include cash and cash equivalents and accounts receivable. Financial liabilities with carrying values approximating fair value include accounts payable and other liabilities. The carrying amounts of these financial assets and liabilities approximate fair value due to their short maturities. Such financial instruments are not included in the following table that provides information about the estimated fair values of other financial instruments that are not measured at fair value in the consolidated balance sheets as of June 30, 2025 and December 31, 2024. June 30, 2025 December 31, 2024 Carrying Amount Fair Value Carrying Amount Fair Value Long-term debt: 10.625 % senior secured notes due January 15, 2031 $ 685.9 $ 719.9 $ — $ — 6.875 % senior secured notes due November 1, 2027 $ — $ — $ 481.6 $ 471.3 Long-term debt is carried at amortized cost and its estimated fair value is based on market prices classified as Level 2 in the fair value hierarchy. Note 10 - Goodwill and Intangible Assets Goodwill In January 2025, the company changed its organizational structure to better align its portfolio of solutions to more effectively address evolving client needs and take further advantage of the synergies across the company’s reportable segments. See Note 15 for additional information on the changes to the company’s operating and reportable segments. These changes did not change the company’s reporting units but were deemed a triggering event, resulting in an interim goodwill analysis on the reporting units impacted as of immediately before and immediately after the change. There were no impairment charges resulting from this analysis. The carrying value of goodwill by reporting unit was as follows: Total DWS CA&I ECS Balance at December 31, 2024 (i) $ 247.9 $ 101.3 $ 54.5 $ 92.1 Translation adjustments 1.0 1.0 — — Balance at June 30, 2025 $ 248.9 $ 102.3 $ 54.5 $ 92.1 (i) CA&I and ECS reporting units’ goodwill balances were reclassified as of December 31, 2024 to conform with the current period reporting units’ presentation. There was no change to the DWS goodwill amount. See Note 15 for additional information on the changes to the company’s operating and reportable segments. Accumulated goodwill impairment losses as of June 30, 2025 and December 31, 2024 were $ 39.1 million in both periods and included within the DWS reporting unit. 16 Intangible Assets, Net Intangible assets, net at June 30, 2025, consists of the following: Gross Carrying Amount Accumulated Amortization Net Carrying Amount Technology $ 10.0 $ 10.0 $ — Customer relationships (i) 54.2 21.0 33.2 Marketing (i) 1.3 1.1 0.2 Total $ 65.5 $ 32.1 $ 33.4 (i) Amortization expense is included within selling, general and administrative expense in the consolidated statements of income (loss). For the three months ended June 30, 2025 and 2024, amortization expense was $ 1.0 million and $ 2.2 million, respectively. For the six months ended June 30, 2025 and 2024, amortization expense was $ 2.1 million and $ 4.6 million, respectively. The future amortization relating to acquired intangible assets at June 30, 2025, was estimated as follows: Future Amortization Expense Remainder of 2025 $ 2.2 2026 4.0 2027 4.0 2028 4.0 2029 4.0 Thereafter 15.2 Total $ 33.4 Note 11 - Debt Long-term debt is comprised of the following: June 30, 2025 December 31, 2024 10.625 % senior secured notes due January 15, 2031 (Face value of $ 700.0 million less unamortized issuance costs of $ 14.1 million at June 30, 2025) (i) $ 685.9 $ — 6.875 % senior secured notes due November 1, 2027 (Face value of $ 485.0 million less unamortized issuance costs of $ 3.4 million at December 31, 2024) (i) — 481.6 Finance leases 3.0 2.8 Other debt 9.5 8.8 Total 698.4 493.2 Less – current maturities 5.7 5.0 Total long-term debt $ 692.7 $ 488.2 (i) See Note 9 for the fair value of the notes. Senior Secured Notes due 2031 In June 2025, the company completed a private placement offering of $ 700.0 million aggregate principal amount of its 10.625 % Senior Secured Notes due 2031 (the 2031 Notes). The 2031 Notes will pay interest semiannually on January 15 and July 15, commencing on January 15, 2026, and will mature on January 15, 2031, unless earlier repurchased or redeemed by the company. The 2031 Notes are fully and unconditionally guaranteed on a senior secured basis by Unisys Holding Corporation, Unisys AP Investment Company I and Unisys NPL, Inc., each a Delaware corporation that is directly or indirectly wholly owned by the company (the Subsidiary Guarantors). The net proceeds from the issuance of the 2031 Notes, together with cash on hand, were used to finance the company’s tender offer to purchase for cash any and all of its outstanding 6.875 % Senior Secured Notes due November 1, 2027 (the 2027 Notes) and solicitation of consents from holders of the 2027 Notes to amendments to the indenture governing the 2027 Notes (the Tender Offer) and the payment of related premiums, fees and expenses. The company also used the net proceeds from the issuance of the 2031 Notes to redeem, on or about November 1, 2025, any 2027 Notes that remain outstanding following the Tender Offer, as explained under the Senior Secured Notes due 17 2027 section below, and to fund, together with cash on hand, a portion of the company’s U.S. defined benefit pension plans deficit and postretirement liabilities. See Note 3 for additional details on the discretionary contribution to the company’s U.S. defined benefit pension plans. The 2031 Notes and the guarantees by the Subsidiary Guarantors rank equally in right of payment with all of the existing and future senior debt of the company and the Subsidiary Guarantors and senior in right of payment to any future subordinated debt of the company and the Subsidiary Guarantors. The 2031 Notes and the guarantees are structurally subordinated to all existing and future liabilities (including preferred stock, trade payables and pension liabilities) of the subsidiaries of the company that are not Subsidiary Guarantors. The 2031 Notes and the guarantees are secured by liens on substantially all assets of the company and the Subsidiary Guarantors, other than certain excluded assets (the collateral). The liens securing the 2031 Notes on certain Asset Based Lending (ABL) collateral are subordinated to the liens on ABL collateral in favor of the ABL secured parties, subject to certain limitations and permitted liens. The company may, at its option, redeem some or all of the 2031 Notes at any time on or after January 15, 2028 at a redemption price determined in accordance with the redemption schedule set forth in the indenture relating to the 2031 Notes, plus accrued and unpaid interest, if any. Prior to January 15, 2028, the company may, at its option, redeem some or all of the 2031 Notes at any time, at a price equal to 100 % of the principal amount of the 2031 Notes redeemed plus a “make-whole” premium, plus accrued and unpaid interest, if any. The company may also redeem, at its option, up to 40 % of the 2031 Notes at any time prior to January 15, 2028, using the proceeds of certain equity offerings at a redemption price of 110.625 % of the principal amount thereof, plus accrued and unpaid interest, if any. On or after January 15, 2028, the company may, on any one or more occasions, redeem all or part of the 2031 Notes at specified redemption premiums, declining to par for any redemptions on or after January 15, 2030. Prior to January 15, 2028, the company may redeem up to 10 % of the aggregate principal amount of the 2031 Notes during each calendar year, commencing in 2025, at a purchase price equal to 103 % of the principal amount of the 2031 Notes, plus accrued and unpaid interest, if any. The indenture relating to the 2031 Notes contains covenants that limit the ability of the company and its restricted subsidiaries (as defined therein) to, among other things: (i) incur additional indebtedness and guarantee indebtedness; (ii) pay dividends or make other distributions or repurchase or redeem its capital stock; (iii) prepay, redeem or repurchase certain debt; (iv) make loans and investments (including investments by the company and the Subsidiary Guarantors in subsidiaries that are not guarantors); (v) sell assets; (vi) create or incur liens; (vii) enter into transactions with affiliates; (viii) enter into agreements restricting its subsidiaries’ ability to pay dividends; and (ix) consolidate, merge or sell all or substantially all of its assets. These covenants are subject to several important limitations and exceptions. If the company experiences certain kinds of changes of control (as defined in the indenture), it must offer to purchase the 2031 Notes at 101 % of the principal amount of the 2031 Notes, plus accrued and unpaid interest, if any. In addition, if the company sells assets under certain circumstances, it must apply the proceeds of such sales towards an offer to repurchase the 2031 Notes at a price equal to par plus accrued and unpaid interest, if any. The indenture also provides for events of default, which, if any of them occur, would permit or require the principal, premium, if any, interest and any other monetary obligations on all the then outstanding 2031 Notes to be due and payable immediately. Interest expense related to the 2031 Notes is comprised of the following: Three Months Ended June 30, 2025 Contractual interest coupon $ 0.8 Amortization of issuance costs — Total $ 0.8 Senior Secured Notes due 2027 As of December 31, 2024, the company had $ 485.0 million aggregate principal amount outstanding of the 2027 Notes. Interest on the 2027 Notes is payable semi-annually on May 1 and November 1. On June 11, 2025, the company commenced the Tender Offer. The purchase price offered per $1,000 principal amount of 2027 Notes pursuant to the Tender Offer was $ 1,006.25 , which included an early tender premium of $ 30.00 per $1,000 principal amount of 2027 Notes. Concurrent with the closing of the issuance of the 2031 Notes, the company paid an aggregate amount of $ 488.6 million, including $ 3.0 million of early tender premium and $ 5.5 million of accrued interest and other expenses through June 27, 2025, to purchase $ 480.1 million of aggregate principal amount outstanding of the 2027 Notes tender in the Tender Offer. On June 27, 2025, the company satisfied and discharged the indenture relating to the 2027 Notes, issued a notice of redemption for its remaining outstanding principal amount, and deposited U.S. government securities with the trustee of the 2027 Notes to 18 cover the remaining outstanding aggregate principal amount of $ 4.9 million, plus accrued but unpaid interest on the 2027 Notes to be redeemed to, but not including, the redemption date. As a result of the satisfaction and discharge, the indenture relating to the 2027 Notes ceased to be of further effect except as to rights of registration of transfer or exchange of 2027 Notes which survive until all 2027 Notes have been canceled and the rights, protections and immunities of the trustee, as expressly provided for in the indenture relating to the 2027 Notes. The satisfaction and discharge of the 2027 Notes resulted in a loss on debt extinguishment of $ 6.8 million, reported in other (expense), net, which included the write-off of unamortized debt issuance costs of $ 3.8 million and an early tender premium of $ 3.0 million paid to repurchase a portion of the 2027 Notes. Interest expense related to the 2027 Notes is comprised of the following: Three Months Ended June 30, Six Months Ended June 30, 2025 2024 2025 2024 Contractual interest coupon $ 8.0 $ 8.4 $ 16.3 $ 16.7 Amortization of issuance costs 0.3 0.3 0.6 0.6 Total $ 8.3 $ 8.7 $ 16.9 $ 17.3 Asset Based Lending (ABL) Credit Facility Concurrently with the issuance of the 2031 Notes, the company entered into an amendment of the company’s secured revolving credit facility (the Amended and Restated ABL Credit Facility) that extended the maturity date from October 2027 to June 2030 and modified certain other terms and covenants. The secured revolving credit facility continues to provide for revolving loans and letters of credit up to an aggregate amount of $ 125.0 million (with a limit on letters of credit of $ 40.0 million), with an uncommitted accordion feature allowing for the aggregate amount available to be increased up to $ 155.0 million upon the satisfaction of certain specified conditions. Availability under the credit facility is subject to a borrowing base calculated by reference to the company’s receivables. At June 30, 2025, the company had no borrowings and $ 8.3 million of letters of credit outstanding. Availability under the credit facility was $ 99.1 million, net of letters of credit issued. The Amended and Restated ABL Credit Facility is subject to a springing maturity, under which the Amended and Restated ABL Credit Facility will immediately mature 91 days prior to any date on which contributions to pension funds in the United States in an amount in excess of $ 100.0 million are required to be paid unless the company is able to meet certain conditions, including that the company has the liquidity (as defined in the Amended and Restated ABL Credit Facility) to cash settle the amount of such pension payments, as applicable, no default or event of default has occurred under the Amended and Restated ABL Credit Facility, the company’s liquidity is above $ 130.0 million and the company is in compliance with the then applicable fixed charge coverage ratio on a pro forma basis. The Amended and Restated ABL Credit Facility is guaranteed by the subsidiary guarantors and any future material domestic subsidiaries. The facility is secured by the assets of the company and the subsidiary guarantors, other than certain excluded assets, under a security agreement entered into by the company and the subsidiary guarantors in favor of Bank of America, N.A., as agent for the lenders under the credit facility. The company is required to maintain a minimum fixed charge coverage ratio if the availability under the Amended and Restated ABL Credit Facility falls below the greater of 10 % of the lenders’ commitments under the facility and $ 12.5 million. The Amended and Restated ABL Credit Facility contains customary representations and warranties, including, but not limited to, that there has been no material adverse change in the company’s business, properties, operations or financial condition. The Amended and Restated ABL Credit Facility includes restrictions on the ability of the company and its subsidiaries to, among other things, incur other debt or liens, dispose of assets and make acquisitions, loans and investments, repurchase its equity, and prepay other debt. These restrictions are subject to several important limitations and exceptions. Events of default include non-payment, failure to comply with covenants, materially incorrect representations and warranties, change of control and default under other debt aggregating at least $ 50.0 million, subject to relevant cure periods, as applicable. At June 30, 2025, the company has met all covenants and conditions under its various lending and funding agreements. For at least the next 12 months, the company expects to continue to meet these covenants and conditions. 19 Note 12 - Litigation and Contingencies The company is involved in a wide range of lawsuits, claims, investigations and proceedings, which arise in the ordinary course of business, including actions with respect to commercial and government contracts, labor and employment, employee benefits, environmental matters, intellectual property and non-income tax matters. Further, given the rapidly evolving external landscape of cybersecurity, privacy and data protection laws, regulations and threat actors, the company and its clients have been and will continue to be subject to actions or proceedings in various jurisdictions. These matters can involve a number of different parties, including competitors, clients, current or former employees, government and regulatory agencies, stockholders and representatives of the locations in which the company does business. Many of these matters are also highly complex and may seek recovery on behalf of a class or similarly large number of plaintiffs. It is therefore inherently difficult to predict the size or scope of potential future losses arising from these matters. The company records a provision for these matters when it is both probable that a liability has been incurred and the amount of the loss can be reasonably estimated and a gain contingency when the award or recovery is realized or realizable. Significant judgment is required in both the determination of probability and the determination as to whether an exposure is reasonably estimable. Because of uncertainties related to these matters, accruals are based only on the best information available at the time. Any provisions are reviewed at least quarterly and are adjusted to reflect the impact and status of settlements, rulings, advice of counsel and other information and events pertinent to a particular matter. These adjustments could have a material impact on our results of operations and financial position. The company intends to defend itself vigorously with respect to any legal matters. Based on its experience, the company also believes that the damage amounts claimed against it in the matters disclosed below are not a meaningful indicator of the company’s potential liability. Legal proceedings are inherently unpredictable and unfavorable resolutions have and could occur. Whether any losses, damages or remedies finally determined in any claim, suit, investigation or proceeding could reasonably have a material effect on the company’s business, financial condition, results of operations or cash flows will depend on a number of variables, including: the timing and amount of such losses or damages; the structure and type of any such remedies; the significance of the impact any such losses, damages or remedies may have in the company’s consolidated financial statements; and the unique facts and circumstances of the particular matter that may give rise to additional factors. Accordingly, it is possible that an adverse outcome from such matters could be material to the company’s financial condition, results of operations and cash flows in any particular reporting period. Notwithstanding that the ultimate results of the lawsuits, claims, investigations and proceedings that have been brought or asserted against the company are not currently determinable, the company believes that at June 30, 2025, it has adequate provisions for any such matters. The following is a summary of the more significant legal proceedings involving the company. The company’s Brazilian operations, along with those of many other companies doing business in Brazil, are involved in various litigation matters, including numerous governmental assessments related to indirect and other taxes, as well as disputes associated with former employees and contract labor. The tax-related matters pertain to value-added taxes, customs, duties, sales and other non-income-related tax exposures. The labor-related matters include claims related to compensation. The company believes that appropriate accruals have been established for such matters based on information currently available. At June 30, 2025, excluding those matters that have been assessed by management as being remote as to the likelihood of ultimately resulting in a loss, the amount related to unreserved tax-related matters, inclusive of any related interest, is estimated to be approximately $ 97 million. On December 3, 2024, Unisys reached a settlement in the case of Unisys Corp. v. Gilbert, et al. pending in the Eastern District of Pennsylvania. The litigation sought damages from Atos, a competitor, and former employees, alleging theft of Unisys trade secrets and confidential information. This settlement for $ 40 million allowed the company to avoid the costs and uncertainties associated with prolonged litigation and reinforces the value of Unisys’s intellectual property. The company received payment of $ 15 million as of December 31, 2024 and the remaining amount is included within accounts receivable, net on the company’s consolidated balance sheets as of June 30, 2025. Subsequent to June 30, 2025, the company received the remaining settlement amount of $ 25 million. The company believes that this settlement was in the best interest of its stockholders and resolved the ongoing litigation in a favorable manner. With respect to the specific legal proceedings and claims described above, except as otherwise noted, either (i) the amount or range of possible losses in excess of amounts accrued, if any, is not reasonably estimable or (ii) the company believes that the amount or range of possible losses in excess of amounts accrued that are estimable would not be material. Nonetheless, the company is unable to predict the outcome from such matters and it is possible that an adverse result could be material to the company’s financial conditions, results of operations and cash flows. 20 Environmental Matters As of June 30, 2025, the company has an estimated environmental liability for a site that its predecessor company previously operated of approximately $ 23 million, of which $ 8 million is reported in other accrued liabilities and $ 15 million in other long-term liabilities on the company’s consolidated balance sheets. The company has an agreement related to this site, which provides for a partial reimbursement of certain costs when all cleanup work has been approved and finalized. As of June 30, 2025, the company expects to recover approximately $ 33 million, which is included in other long-term assets on the company’s consolidated balance sheets. As the company continues to perform investigation activities and if events and circumstances change, the company may incur future additional costs, which could have a material impact on the company’s results of operations, financial condition and cash flows. Note 13 - Accumulated Other Comprehensive Loss Accumulated other comprehensive loss is as follows: Total Translation Adjustments Postretirement Plans Balance at December 31, 2024 $ ( 2,757.2 ) $ ( 984.7 ) $ ( 1,772.5 ) Other comprehensive income (loss) before reclassifications 65.9 133.7 ( 67.8 ) Amounts reclassified from accumulated other comprehensive loss 39.6 ( 2.7 ) 42.3 Current period other comprehensive income (loss) 105.5 131.0 ( 25.5 ) Balance at June 30, 2025 $ ( 2,651.7 ) $ ( 853.7 ) $ ( 1,798.0 ) Amounts reclassified out of accumulated other comprehensive loss are as follows: Three Months Ended June 30, Six Months Ended June 30, 2025 2024 2025 2024 Translation adjustments: Adjustment for substantial completion of liquidation of certain foreign subsidiaries (i) $ ( 1.6 ) $ 1.2 $ ( 2.7 ) $ 1.7 Pension and postretirement plans (ii) : Amortization of prior service benefit ( 0.9 ) ( 0.9 ) ( 1.8 ) ( 1.9 ) Amortization of actuarial losses 23.2 19.1 46.1 41.4 Settlement losses — — — 125.5 Total before tax 20.7 19.4 41.6 166.7 Income tax ( 0.6 ) ( 0.8 ) ( 2.0 ) ( 1.6 ) Total reclassifications for the period $ 20.1 $ 18.6 $ 39.6 $ 165.1 (i) Reported in other (expense), net in the consolidated statements of income (loss). (ii) These items are included in net periodic pension and postretirement cost (see Note 3). 21 Note 14 - Supplemental Cash Flow Information Six Months Ended June 30, 2025 2024 Cash paid during the period for: Income taxes, net of refunds $ 47.7 $ 26.0 Interest $ 22.5 $ 17.9 The following table provides a reconciliation of cash and cash equivalents and restricted cash reported within the consolidated balance sheets to the total of the amounts shown in the consolidated statements of cash flows. June 30, 2025 December 31, 2024 Cash and cash equivalents $ 300.8 $ 376.5 Restricted cash 8.2 14.1 Total cash, cash equivalents and restricted cash shown in the consolidated statements of cash flows $ 309.0 $ 390.6 Cash and cash equivalents subject to contractual restrictions, and are therefore not readily available, are classified as restricted cash. At June 30, 2025, the company maintains cash balances in various operating accounts in excess of federally insured limits. The company monitors this risk by evaluating the creditworthiness of the financial institutions. Note 15 - Segment Information In January 2025, the company changed its organizational structure to better align its portfolio of solutions to more effectively address evolving client needs and take further advantage of the synergies across the company’s reportable segments. The company’s business processing solutions, which were reported within Other, have been integrated into the company’s Enterprise Computing Solutions (ECS) and Cloud, Applications & Infrastructure Solutions (CA&I) reportable segments. Additionally, the company’s application development and modernization capabilities, which were reported within ECS, have been operationally centralized within CA&I. These changes did not impact the company’s consolidated financial statements as of December 31, 2024. Prior period amounts have been reclassified to be comparable to the current period’s presentation. The company’s reportable segments are as follows: • Digital Workplace Solutions (DWS), which provides workplace solutions featuring intelligent workplace services, proactive experience management and collaboration tools to support business growth; • Cloud, Applications & Infrastructure Solutions (CA&I), which provides digital transformation in the areas of cloud migration and management, applications and infrastructure transformation and modernization solutions; and • Enterprise Computing Solutions (ECS), which provides solutions that harness secure, high-intensity enterprise computing and enable digital services through software-defined operating environments. This segment structure reflects the financial information used by the company’s chief operating decision maker (CODM) to make decisions regarding the company’s business, including resource allocations and performance assessments, as well as the current operating focus. The CODM evaluates the performance of the segments based on segment revenue and segment gross profit. The company’s CODM regularly reviews cost of revenues by segment and treats it as a significant segment expense. Segment revenue and segment gross profit are exclusive of certain activities and expenses that are not allocated to specific segments and reported in Other as described below. The company does not report assets by reportable segments as this information is not reviewed by the CODM on a regular basis. Other, as presented in the reconciliation tables below, includes revenue and cost of revenue associated with the company’s United Kingdom business process outsourcing consolidated joint venture, which is a non-core business activity. Additionally, Other includes certain expenses within cost of revenue such as cost reduction charges, amortization of purchased intangibles and unusual and nonrecurring items that are not allocated to specific segments. These amounts are combined within other revenue and other gross profit (loss) to arrive at total consolidated revenue and total consolidated gross profit (loss) as reported in the reconciliations below. 22 The following tables present certain financial information by reportable segments: Total Segments DWS CA&I ECS Three Months Ended June 30, 2025 Revenue $ 463.5 $ 138.1 $ 185.2 $ 140.2 Cost of revenue 326.5 114.7 146.6 65.2 Gross profit $ 137.0 $ 23.4 $ 38.6 $ 75.0 Three Months Ended June 30, 2024 Revenue $ 456.7 $ 132.1 $ 193.9 $ 130.7 Cost of revenue 325.6 110.7 153.8 61.1 Gross profit $ 131.1 $ 21.4 $ 40.1 $ 69.6 Total Segments DWS CA&I ECS Six Months Ended June 30, 2025 Revenue $ 877.4 $ 256.7 $ 361.8 $ 258.9 Cost of revenue 632.5 216.4 288.8 127.3 Gross profit $ 244.9 $ 40.3 $ 73.0 $ 131.6 Six Months Ended June 30, 2024 Revenue $ 916.7 $ 264.4 $ 382.3 $ 270.0 Cost of revenue 653.9 224.0 305.6 124.3 Gross profit $ 262.8 $ 40.4 $ 76.7 $ 145.7 Presented below is a reconciliation of total segment revenue to total consolidated revenue: Three Months Ended June 30, Six Months Ended June 30, 2025 2024 2025 2024 Total segment revenue $ 463.5 $ 456.7 $ 877.4 $ 916.7 Other revenue 19.8 21.5 38.0 49.3 Total consolidated revenue $ 483.3 $ 478.2 $ 915.4 $ 966.0 Presented below is a reconciliation of total segment gross profit to consolidated income (loss) before income taxes: Three Months Ended June 30, Six Months Ended June 30, 2025 2024 2025 2024 Total segment gross profit $ 137.0 $ 131.1 $ 244.9 $ 262.8 Other gross profit ( 7.0 ) ( 1.2 ) ( 7.4 ) 3.1 Total gross profit 130.0 129.9 237.5 265.9 Selling, general and administrative expense ( 93.6 ) ( 101.4 ) ( 190.4 ) ( 213.6 ) Research and development expense ( 6.1 ) ( 4.9 ) ( 11.7 ) ( 11.0 ) Interest expense ( 8.2 ) ( 7.9 ) ( 16.4 ) ( 15.8 ) Other (expense), net ( 22.1 ) ( 9.4 ) ( 39.0 ) ( 151.5 ) Total income (loss) before income taxes $ — $ 6.3 $ ( 20.0 ) $ ( 126.0 ) 23 Geographic information about the company’s revenue, which is principally based on location of the selling organization, is presented below: Three Months Ended June 30, Six Months Ended June 30, 2025 2024 2025 2024 United States $ 195.5 $ 204.4 $ 381.4 $ 416.7 United Kingdom 59.5 48.3 114.6 115.3 Other foreign 228.3 225.5 419.4 434.0 Total $ 483.3 $ 478.2 $ 915.4 $ 966.0 24