Earnings call transcript: Prysmian Q3 2025 misses EPS forecast, stock dips

Prysmian SpA reported mixed Q3 2025 results, with earnings per share of $1.01 missing the $1.19 forecast by 15.13%, yet revenue exceeded expectations at $5.03 billion. Despite a 2.05% stock decline reflecting investor disappointment over the EPS miss, the company achieved a record €644 million EBITDA, up significantly year-over-year, and nearly doubled net income to €1.022 billion, partly due to a YUSA stake sale. Prysmian raised its full-year EBITDA guidance to €2.40 billion, signaling confidence driven by strong organic growth, particularly in North America (benefiting from tariffs and data center expansion), and its transmission business, which is ahead of its 2028 margin targets.

Analysis

Prysmian SpA reported a mixed Q3 2025, with earnings per share (EPS) of $1.01 falling 15.13% short of the $1.19 forecast, leading to a 2.05% stock decline. Conversely, the company exceeded revenue expectations, reporting $5.03 billion against a $4.92 billion forecast. This divergence indicates investor sensitivity to profitability metrics despite robust top-line growth.

Despite the EPS miss, Prysmian achieved a record Q3 EBITDA of €644 million, over €100 million higher year-over-year, with the EBITDA margin improving to 14.8%. Net income nearly doubled to €1.022 billion, significantly aided by a €350 million gain from a YUSA stake sale. This operational strength, coupled with 9% organic growth in the quarter, prompted the company to raise its full-year EBITDA guidance to €2.40 billion, reflecting confidence in sustained performance.

Key growth drivers include strong performance in North America, particularly in Power Grid (+20% in the US) and Electrification (+10% YoY in the US), benefiting from tariff impacts and data center expansion, where revenues doubled. The Transmission business achieved an 17.8% EBITDA margin, already nearing its 2028 target of 18-20%. Prysmian plans to leverage Encore Wire's 30% spare capacity to capitalize on tariff-driven market share opportunities and is considering M&A for further expansion.

Key Decisions for Investors

• Investors should closely monitor the realization of tariff benefits and the company's ability to convert spare capacity into sustained market share gains and profitability in North America.
• Evaluate the trajectory of the Transmission segment's EBITDA margins, assessing if the 20.5% ceiling is achievable and how this impacts overall profitability.
• Consider the strategic implications of potential M&A activities and the planned US listing in 2026, which could enhance market access and valuation.
• Assess the company's ability to mitigate risks from fiber shortages and macroeconomic pressures, particularly fluctuating raw material prices, while maintaining strong organic growth.