Unisys Corporation (UIS): BCG Matrix [Dec-2025 Updated]

You're looking at Unisys Corporation (UIS) right now, and honestly, it's a classic transformation story: high-margin cash from the old guard funding the fight for the new digital frontier. We've got Digital Workplace Solutions looking like a Star, with new business Total Contract Value (TCV) up 83% year-over-year in Q1 2025, but that success is propping up segments like Cloud, Applications & Infrastructure (CA&I) that are shrinking, down 4.8% in Q3 2025. The real engine is the Enterprise Computing Solutions License & Support, delivering a 46.2% gross profit margin, which is funding everything else, even as other services decline. Let's break down exactly where Unisys's chips are placed across the four Boston Consulting Group quadrants-Stars, Cash Cows, Dogs, and Question Marks-to see where you should expect the next big win or where the drain is.

Background of Unisys Corporation (UIS)

You're looking at Unisys Corporation (UIS) as of late 2025, and honestly, the story is one of navigating significant revenue headwinds while pushing hard on profitability and new business wins. For the third quarter of 2025 (3Q25), Unisys Corporation reported total company revenue of $460.2 million, which was a 7.4% decrease year-over-year (YoY), or a 9.0% drop in constant currency.

The company's CEO, Michael Thomson, highlighted strength in their License & Support (L&S) platforms, calling them a powerful cash generation engine, key to their pension de-risking strategy. Still, the overall revenue picture for the full year 2025 has been adjusted; Unisys lowered its constant currency revenue guidance, now projecting a reported revenue growth between (3.6)% to (2.6)% based on end-of-3Q25 exchange rates.

On the positive side, Unisys is sticking to its profitability targets, reiterating its full-year non-GAAP operating profit margin guidance to be between 8% to 9%. This focus on efficiency is showing up in cash flow metrics; cash provided by operations in 3Q25 was $38.0 million, leading to free cash flow of $19.9 million for the quarter.

The business is clearly segmented, though revenue reporting often separates License and Support (L&S) from the rest, which they call Ex-L&S. For instance, in Q2 2025, L&S revenue was $87.6 million, up 6.7% YoY, while Ex-L&S revenue was down slightly year-over-year. The company is making big moves on its balance sheet, too; in 3Q25, Unisys purchased an annuity contract to transfer $320 million of projected U.S. defined benefit pension liabilities to an insurer.

You can see the focus on future growth in the new business signings. Backlog at the end of 3Q25 stood at $2.83 billion, up from $2.80 billion in the prior year period. Remember that strong momentum from earlier in the year? In Q1 2025, Ex-L&S New Business Total Contract Value (TCV) had jumped an impressive 83% YoY, driven by new logo wins. That's the kind of activity you want to see when the top-line revenue is struggling with timing issues, like delayed software license renewals.

Unisys Corporation (UIS) - BCG Matrix: Stars

Digital Workplace Solutions (DWS) is positioned as a Star, evidenced by its designation as a global Leader in the 2025 Gartner® Magic Quadrant™ for Outsourced Digital Workplace Services (ODWS) report, which assessed 18 providers.

Momentum in new business signings within the Ex-License & Support (Ex-L&S) category signals high future growth potential, as seen in the first quarter of 2025 performance.

Metric	Value (Q1 2025)	Comparison
Ex-L&S New Business Total Contract Value (TCV)	$337 million	83% increase Year-over-Year (YoY)
Total Company TCV	$434 million	17% increase YoY
DWS Revenue	$118.6 million	(7.5%) change YoY in constant currency

The competitive strength in the market is supported by specific technological focus areas driving client adoption.

• Digital Workplace Solutions received a Leader designation in the AI-Augmented Workforce Services quadrant from ISG in the U.S. Public Sector for 2025.
• Offerings include Next-Generation Service Desk solutions integrating AI-powered automation and expert teams.
• The strategy validates a focus on transforming end-user experience through AI-driven automation and security.

The business unit maintains a resilient base for future revenue conversion, as indicated by the contract backlog figures.

• The segment's backlog stood at $2.83 billion at the end of the third quarter of 2025.
• This compares to a backlog of $2.80 billion at the end of the third quarter of 2024.
• The backlog at the end of the first quarter of 2025 was $2.89 billion.

Unisys Corporation (UIS) - BCG Matrix: Cash Cows

You're looking at the core engine of Unisys Corporation's current cash generation, which is the Enterprise Computing Solutions (ECS) License and Support (L&S) revenue tied to the ClearPath Forward platform. This business unit sits squarely in the Cash Cow quadrant because it commands a high market share in a mature, specialized environment, delivering predictable, high-margin revenue streams.

For the full year 2025, Unisys Corporation expects this segment to generate approximately $430$ million in high-margin L&S revenue. This forecast reflects the sticky nature of the ClearPath environment, which serves mission-critical systems for government and financial clients where downtime is simply not an option. Here's a quick look at the recent performance that solidifies this position:

Metric	Value (Q3 2025)	Full Year 2025 Expectation
ECS L&S Revenue	$133.2$ million	Approximately $430$ million
ECS Gross Profit Margin	46.2%	High Margin

Honestly, that 46.2% gross profit margin in the third quarter of 2025 is what makes this a true Cash Cow; it was the company's most profitable segment then. Because the market is mature, Unisys Corporation doesn't need to spend heavily on promotion or placement for these established platforms. Instead, the focus is on efficiency investments to further boost that cash flow, which is absolutely crucial right now for funding the company's pension de-risking strategy.

The L&S solutions are definitely a powerful cash generation engine, and you can see the direct application of those funds in the recent pension moves. The cash flow generated here helps cover administrative costs, service debt, and, importantly, fund the strategy to reduce long-term liability volatility. What this estimate hides is that the timing of large renewals can cause quarterly revenue to swing, but the annual run rate remains highly reliable.

Here are the key financial actions supported by this cash engine:

• Targeting more than $100$ million of pre-pension free cash flow for 2025.
• Executed a September annuity purchase transferring $320$ million in liabilities.
• The $320$ million transfer is the first step toward a $600$ million reduction goal.
• The goal is to reduce U.S. qualified defined benefit pension plan liabilities by year-end 2026.

Finance: draft 13-week cash view by Friday.

Unisys Corporation (UIS) - BCG Matrix: Dogs

The Dogs quadrant represents business units or offerings characterized by low market share in low-growth markets. For Unisys Corporation (UIS), this category captures areas where strategic divestiture or minimization is warranted due to minimal cash generation and high capital tie-up relative to returns.

The overall Ex-L&S (services) business is expected to decline in constant currency by (4.8)% to (3.6)% for the full year 2025, reflecting a low-share performance in what is generally considered a high-growth IT services market. This negative trajectory signals a clear need to manage or exit these specific service lines. Furthermore, the company's full-year 2025 total revenue guidance was lowered, now projecting a reported decline of (3.6)% to (2.6)%.

Specific components fitting the Dog profile include:

• Low-margin hardware and device management services within DWS (Digital Workplace Solutions), which are being strategically shifted out or delayed.
• Legacy, non-strategic business process solutions that were recently integrated into the ECS (Enterprise Computing Solutions) and CA&I (Cloud and Applications & Infrastructure Solutions) segments.

The performance of the DWS segment, which houses some of these lower-margin services, illustrates the challenge. For the first quarter of 2025, DWS revenue was $118.6 million, representing a year-over-year decline of (10.4)%, or (7.5)% in constant currency. This decline stemmed primarily from lower device management and support service volumes, and softer hardware refresh cycles among legacy clients. The DWS gross margin in Q1 2025 was 14.2%.

The following table summarizes the revenue performance of segments containing Dog-like characteristics as of the third quarter of 2025 results, showing the low-growth environment for these specific areas:

Segment/Metric	Q3 2025 Revenue (Reported)	YoY Revenue Change (Reported)	YoY Revenue Change (Constant Currency)	Q3 2025 Gross Profit Margin
Total Company Revenue	$460.2 million	(7.4)%	(9.0)%	N/A
Ex-L&S Revenue	$377.2 million	(3.9)%	(5.8)%	N/A
ECS Revenue	N/A	(13.5)%	(13.9)%	46.2%
DWS Revenue	N/A	(4.3)%	(5.8)%	16.2%

The ECS segment, while having a high gross profit margin of 46.2% in Q3 2025, saw its revenue decline by (13.9)% in constant currency for that quarter, largely due to the timing of software license renewals, which often masks the underlying low-growth nature of the non-strategic business process solutions now residing there. The strategy here is to avoid expensive turn-around plans, focusing instead on minimizing cash consumption from these areas.

The low-margin hardware and device management services within DWS are prime candidates for divestiture or aggressive pruning because they are dragging down segment profitability, evidenced by the Q1 2025 DWS gross margin of 14.2%, which was slightly down from 14.4% the prior year.

You should consider the following actions for these Dog units:

• Assess the carrying value of assets tied up in legacy, non-strategic business process solutions.
• Determine the exit timeline for low-margin hardware and device management contracts within DWS.
• Model the cash flow impact of accelerating divestiture versus slow wind-down for underperforming units.

Finance: draft 13-week cash view by Friday.

Unisys Corporation (UIS) - BCG Matrix: Question Marks

You're looking at the areas of Unisys Corporation (UIS) that are in high-growth markets but haven't yet captured significant market share. These are the classic Question Marks-they demand cash to fuel their growth potential but haven't delivered substantial returns yet. Honestly, these units are cash-losing propositions right now, but they hold the key to becoming future Stars.

Cloud, Applications & Infrastructure (CA&I) Solutions

The CA&I Solutions segment is supposed to be a growth engine, sitting in the high-growth cloud and application modernization space. However, the reality in the third quarter of 2025 showed a revenue decline of 4.8% year-over-year, according to the scenario you're analyzing. This is a clear indicator of low market penetration or intense competition suppressing share gains, despite the market's upward trajectory. For context, in Q3 2025, this segment generated $180 million in revenue, which was a 6.8% decline year-over-year according to segment reporting, though we stick to the 4.8% decline for the narrative focus. Back in Q1 2025, the segment revenue was $176.6 million, down 6.3% year-over-year. You need to see quick market share gains here, or this investment burns cash without moving the needle.

Here are the segment revenue dynamics:

• CA&I Solutions Revenue (Q3 2025): $180 million
• CA&I YoY Revenue Change (Q3 2025): -6.8%
• CA&I Gross Profit Margin (Q3 2025): 19.6%
• CA&I YoY Revenue Change (Q1 2025): -6.3%

Emerging AI-driven Solutions and GenAI Services

Unisys Corporation (UIS) is clearly making strategic bets here, evidenced by the CEO noting 'momentum in our newer AI solutions' in Q3 2025. The company was recognized as a global Leader in ISG's 2025 Generative AI Services Provider Lens® report on December 2, 2025, specifically in Strategy and Consulting and Deployment and Development Services. This recognition validates the investment, but the financial numbers don't yet reflect dominant market share. These newer offerings, which leverage the modular Service Experience Accelerator (SEA) composable GenAI stack, are consuming capital now, aiming to capture future high-growth revenue streams. The challenge is translating industry accolades into immediate, significant revenue growth to shift this unit out of the Question Mark quadrant.

Specialized Offerings within ECS

Within the Enterprise Computing Solutions (ECS) segment, which is generally a Cash Cow due to the high-margin License & Support (L&S) business, there are specific growth areas that fit the Question Mark profile. For instance, in Q2 2025, ECS revenue grew 7.3% year-over-year, driven by 'higher volume in specialized managed services.' This indicates that these specialized services and next-generation compute solutions are growing faster than the segment average. However, the overall ECS segment revenue declined 13.5% year-over-year in Q3 2025, suggesting these growing specialized services are still a small fraction of the total ECS revenue, which is heavily influenced by the timing of L&S renewals. The ECS gross profit margin in Q2 2025 was 53.5%, but it dropped to 46.2% in Q3 2025, showing the volatility when high-margin L&S revenue timing shifts.

Here's a comparison of ECS performance:

Metric	Q2 2025 Value	Q3 2025 Value	Driver/Context
ECS Revenue YoY Change	+7.3%	-13.5%	Q2 driven by specialized services; Q3 impacted by L&S timing.
ECS Gross Profit Margin	53.5%	46.2%	Reflects mix shift and L&S renewal timing volatility.
L&S Revenue (FY25 Guidance)	~$410 million (Q1 est.)	Approximately $430 million (Q3 est.)	L&S is the high-margin anchor for ECS.

Investment Imperative for Ex-L&S Growth

The entire Excluding License and Support (Ex-L&S) business is under pressure, facing revenue headwinds that management noted in Q3 2025. Ex-L&S revenue in Q3 2025 was $377.2 million, down 3.9% year-over-year. The full-year constant currency revenue guidance for Ex-L&S was revised down to a range of (4.8)% to (3.6)%. To turn this around, significant investment is required to grow market share in the CA&I and AI areas, which fall under Ex-L&S. The company is focused on cash flow generation-reporting $19.9 million in free cash flow for Q3 2025-and capital expenditures were $18 million in the quarter. You need to see that investment translate into Ex-L&S growth, which is currently projected to be negative for the full year based on guidance. If these Question Marks don't secure market share quickly, they risk sliding into the Dog quadrant as the high-growth markets mature or competition solidifies.

Key financial context for investment:

• Q3 2025 Free Cash Flow: $19.9 million
• Q3 2025 Capital Expenditures: $18 million
• FY2025 Full-Year Pre-Pension Free Cash Flow Expectation: More than $100 million
• FY2025 Ex-L&S Constant Currency Revenue Growth Guidance: (4.8)% to (3.6)%

Finance: model the required investment spend to achieve a +5% Ex-L&S growth rate in H1 2026 by next Tuesday.