Unisys

Unisys Corporation, a Pennsylvania-based IT services company with approximately $2.0 billion in revenue (FY2021), operated a legacy infrastructure services business built on proprietary ClearPath and other mainframe platforms. The company maintained data centers globally to support managed infrastructure services contracts, but these facilities were increasingly expensive to operate as clients demanded modern cloud capabilities at lower price points. Infrastructure-related costs — data center leases, hardware depreciation, power, and facilities staff — consumed a disproportionate share of revenue, and the company's technology support services segment was experiencing declining revenue as clients migrated workloads off proprietary platforms. Operating margins were thin and inconsistent, with free cash flow generation challenged by ongoing infrastructure investment requirements.

Under CEO Peter Altabef, Unisys executed a multi-year transformation to shift from infrastructure ownership to cloud-first delivery:

• CloudForte platform: Developed and deployed CloudForte, a managed cloud platform built on AWS and Azure, as the primary delivery mechanism for infrastructure services. CloudForte provided automated provisioning, monitoring, and management of client environments on hyperscaler infrastructure, eliminating the need for Unisys-owned data center capacity for new engagements.
• ClearPath Forward modernization: Rather than abandoning its proprietary mainframe client base, Unisys created ClearPath Forward as a cloud-accessible version of its mainframe platform, allowing clients to maintain existing applications while Unisys moved the hosting from on-premises hardware to virtual environments. This preserved revenue while reducing per-client infrastructure cost.
• Data center exit strategy: Systematically reduced owned and leased data center footprint, consolidating from multiple facilities to a smaller core. Each facility exit eliminated fixed costs for power, cooling, facilities management, and physical security.
• Workforce skills transition: Invested in retraining infrastructure engineers in cloud architecture, DevOps, and security operations, converting legacy platform expertise into cloud-relevant capabilities that could be delivered remotely rather than requiring on-site presence.
• Segment restructuring: Reorganized reporting into Digital Workplace Solutions, Cloud and Infrastructure Solutions, and Enterprise Computing Solutions — clarifying the cloud-first direction and separating legacy from modern revenue streams.

• Infrastructure cost reduction: Data center consolidation and cloud migration reduced Unisys's infrastructure-related fixed costs, improving the cost structure of its managed services business.
• Cloud revenue growth: CloudForte-based managed services grew as a proportion of the infrastructure services segment, replacing higher-cost on-premises delivery with more efficient cloud-based operations.
• Margin improvement: The shift from capital-intensive infrastructure to services and cloud management improved operating margin trajectory, with cloud-delivered services carrying higher gross margins than traditional hosting.
• Capex reduction: Capital expenditure declined as a percentage of revenue as new business was delivered on hyperscaler infrastructure rather than Unisys-owned equipment.
• Revenue per employee: The workforce skills transition and shift to cloud delivery improved revenue per employee as automation replaced manual infrastructure management tasks.
• Timeframe: Cloud-first transformation executed over 2020-2023.

• ClearPath Forward's ability to run in cloud environments provided a unique migration path for mainframe clients that competitors could not replicate
• Long-standing relationships with federal government and financial services clients provided stable revenue during the transformation period
• AWS and Azure partnership programs provided co-investment in CloudForte development and go-to-market support
• India-based delivery centers provided cost-effective cloud management resources that improved the margin structure of cloud-delivered services