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

Prysmian SpA reported its Q3 2025 earnings, revealing a mixed financial performance. The company posted an earnings per share (EPS) of $1.01, falling short of the forecasted $1.19, resulting in a 15.13% negative surprise. Despite this, Prysmian exceeded revenue expectations, reporting $5.03 billion against a forecast of $4.92 billion. The company's stock reacted negatively, declining by 2.05% during open market trading, closing at $89.82.

Key Takeaways

• Prysmian's Q3 2025 EPS missed expectations by 15.13%, while revenue exceeded forecasts.
• The company's EBITDA improved significantly year-over-year, driven by organic growth and strategic disposals.
• Market reaction was negative, with the stock price dropping by 2.05%.
• Prysmian raised its full-year EBITDA guidance, reflecting confidence in future performance.
• The company is focusing on sustainable solutions and innovation in fiber technology.

Company Performance

Prysmian demonstrated robust performance in Q3 2025, with EBITDA reaching €644 million, over €100 million higher than the same period last year. The EBITDA margin improved to 14.8%, up by one percentage point year-over-year. The company's net income nearly doubled to €1.022 billion, boosted by a €350 million gain from the sale of a stake in YUSA. Organic growth was strong at 9% for the quarter, contributing to a 6% growth over the first nine months of the year.

Financial Highlights

• Revenue: $5.03 billion, up from the forecasted $4.92 billion.
• Earnings per share: $1.01, below the expected $1.19.
• EBITDA: €644 million, significantly higher than Q3 2024.
• EBITDA margin: 14.8%, an increase from the previous year.

Earnings vs. Forecast

Prysmian's Q3 2025 EPS of $1.01 fell short of the $1.19 forecast, marking a 15.13% negative surprise. However, the company exceeded revenue expectations, reporting $5.03 billion compared to the anticipated $4.92 billion. This mixed performance reflects both challenges and opportunities in the current market environment.

Market Reaction

Following the earnings release, Prysmian's stock price decreased by 2.05%, closing at $89.82. This decline reflects investor disappointment over the EPS miss, despite the positive revenue surprise. The stock remains below its 52-week high of $93.06 but well above its low of $38.57, indicating a relatively stable position in the market.

Outlook & Guidance

Prysmian raised its full-year EBITDA guidance from €2,340 million to €2,400 million, signaling confidence in its future performance. The company expects gradual benefits from tariffs in the coming quarters and is targeting an 18-20% EBITDA margin in its transmission business by 2028. Potential mergers and acquisitions in North America, Latin America, and Europe are also on the horizon.

Executive Commentary

CEO Massimo Bataini stated, "Quarter three 2025 is the best quarter ever," highlighting the company's strong performance. He also emphasized the importance of innovation, saying, "Innovation is our key driver of profitability and volume and share enhancement."

Risks and Challenges

• Potential market consolidation due to tariff impacts could affect competitive dynamics.
• Fiber shortages in the US market may constrain growth in the optical cable segment.
• Macroeconomic pressures, such as fluctuating raw material prices, could impact profitability.

Q&A

During the earnings call, analysts focused on the impacts of tariffs and the company's strategies for expanding in the data center and fiber markets. Discussions also covered the margins of Encore Wire and strategic insights for market expansion.

Full transcript - Prysmian SpA (PRY) Q3 2025:

Conference Moderator: Good day, and thank you for standing by. Welcome to the Prismium Nine Months twenty twenty five Integrated Results Conference Call. At this time, all participants are in a listen only mode. After the speakers' presentation, there will be a question and answer session. Please be advised that today's conference is being recorded.

I would now like to hand the conference over to your speaker today, Massimo Bataini, CEO. Please go ahead.

Massimo Bataini, CEO, Prismium: Good morning, everyone, and welcome to the earnings call of nine months twenty twenty five. I'm very excited today to share with you this fantastic success. Quarter three EBITDA '25 is the best quarter ever. It is over a 100,000,000 higher than the same quarter last year, '24, in spite of the 30,000,000, almost 30,000,000 adverse impact. So you should read on a like for like 670 versus 500 40.

Remarkable, also the EBITDA margin that reached the outstanding level of 14.8%, one percentage point higher than the nine months comparison to last year. The organic growth in the quarter has been outstanding also with a 9% increase that brings the overall nine months growth for '25 at 6%. We also continue our successful journey towards sustainable targets, 39% has been the CO2 emission reduction on score one and two versus deadline and the recycled contents of material in our cables risen to 21%. Let me now enter into each business unit to explain the strengths and the performance of the individual business units. Transmission, first of all, strong backlog, CHF16 billion.

We had excellent line with what was in the past despite additional revenue consumption. And in top of the CHF16 billion backlog, we have been pretty successful in the order intake in quarter three, with three more billion years worth of project awarded in this quarter. That will turn and convert into backlog in the coming months as this project will be awarded in notice to proceed. Amazing has been the growth of transmission, 40% in the quarter, which confirmed a solid growth in the nine months, almost 39%, 40% also for the nine months. And outstanding is the EBITDA has risen from 90,000,000 last year same period to 150.

And by the way, this 150,000,000, you know probably already, is in one quarter what one of our competitor makes in the full year. Extremely rewarding for us is the EBITDA margin achieved achieved in the quarter, almost 18%. You remember that we set goals for 2028 whereby we will need to achieve a range of 18% to 20% EBITDA margin by 2028. So we are well ahead of that trajectory. 1780 is 2.5 points higher than same quarter last year.

And if you take the nine months view, it's the same. We are three percentage points higher than last year. Thanks to a flawless execution, thanks to better margin in our backlog and thanks to our entire team, regions and the transmission BO working hand in hand to maximize the result and maximize the execution of the CapEx and the relevant projects. Let me now move into Power Grid space. The organic has been significantly high, 15%, basically driven by all countries, with North America outpacing this 15% growth, more than 20% was the growth in The United States.

When you look at EBITDA, you see moderate growth in EBITDA, but you know you have to take into account two effects in this CHF 6,000,000 only increase in EBITDA in '23, import it to '25 or '24. There is a Forex impact of close to CHF 8,000,000. And there is a Midwest impact driven by tariffs that hit one element, one family of products in our portfolio of business in U. S, the overhead business. It's a project driven business where we have firm price and we did hit by projects that landed in quarter one and quarter two, where we could not stand a chance to increase and adjust the price to reflect the Midwest premium impact.

So you see a temporary blip in the EBITDA margin, 15.2% last year, 14.7% this year. This will be recovered in the coming months as we flush out the old project backlog and we land the new project. The rest of the power grid business in the West is immune to Midwest premium because we have formula in frame agreement to transfer the cost to the market. The organic growth in the nine months has also been pretty successful with a solid 6%. Moving to electrification, in spite of this moderate growth in I and C Global, you have to see behind this a strong organic growth in United States, 10% year over year growth in quarter three, remarkable growth in EBITDA in U.

S. In quarter three. Despite a weak start with July, still affected by negative tariffs, thanks to August, we had performed a 15% EBITDA increase quarter three twenty five over quarter three twenty four in The U. S. In the IEC space, namely more than $30,000,000 in absolute value.

Unfortunately, this has been offset by Forex and has been offset by some pricing normalization in LatAm, where we had the spikes last year in quarter one, quarter two and quarter three in Argentina, which has normalized over the period of this period of time. EBITDA margin, we achieved sustainable 14.5 level. And when you look at the nine month view, you see the upgrade and the accretion of EBITDA margin associated to the attributed to the acquisition of the accretive and profitable perimeter of Angkorvoye. Specialty, I cannot say that we are happy. Actually, we are disappointed, but there is nothing that was not foreseen.

We are still struggling with the automotive performance. The demand is very weak. Price pressure is very high. We are still working on the disposal of few plants and the process is all. Unfortunately, I have to make this taking longer than expected.

We will resolve this in the next months. And we also continue to see some level of softening in the elevator space in The U. S. Attributed to the weakness of the residential market in The U. S.

Moving to the last business unit of Digital Solution, we reported a significant organic growth standalone legacy Prisma, 13% in the quarter. And you see the EBITDA led from EUR45 million to EUR88 million, thanks also to the perimeter change. There is the inclusion of more or less EUR40 million euros coming from the channel integration. This is the first quarter where the full consolidation in the three months of the channel carried. Amazing is EBITDA margin.

We never had better than 14% EBITDA margin in the business in the past. Now we raise this level of margin sustainable in the future to 20% with additional scope, with additional connectivity in The U. Space. Before I hand over to Francesco for more financial insight, let me draw your attention to maybe one only of these KPIs, the first one on the top right hand side of the page, revenues linked to sustainable solution. We raised this level from 42 last year to 44, 45 already.

In the twelve months, we we will show another improvement over this level. We have a target of 55% by 2028 as per our Capital Market Day. This is our important way, was an important way, is an important KPI to read our ability to innovate, to drive EBITDA margin improvement. And the 14.8% EBITDA margin achieved in quarter three is a real reflection of the efforts that commercial R and D operation and the rest of team has put in innovating our portfolio, innovating our solution to increase share of wallet on the one hand and improve profitability. And now Francesco.

Francesco, CFO, Prismium: Thank you, Massimo, and good morning to everybody. As usual, let me recap our profit and loss and summarize some messages that Massimo has already passed. The an outstanding quarter is a three quarter, starting from the revenues 14,700,000,000.0 with an organic growth in the third quarter, very robust over 9%, which was driven by an outstanding growth in transmission and a very strong improvement in the growth of Power Grids, by the way, across the board, as Massimo said, in North America, but also pretty strong in Europe. The highest quarter ever in terms of EBITDA, you see the bridge on the right of this page quarter by quarter. I would focus on quarter three, EUR644 million, an increase of over EUR100 million versus Q3 twenty twenty four in spite of a pretty significant adverse ForEx effect of 7,000,000, which is mainly seeing the power grid and the electrification business, but also digital solution business.

In terms of margin, I don't have much to add to what Massimo said. At constant metal in the quarter, we give you one percentage point from Q3 twenty twenty four, mainly driven by the growth of the margin, but also of the revenues in transmission, which is obviously changing the mix in the positive sales, was driven definitely the increase of margin by the full inclusion of channel in our third quarter results. And I would add also a pretty robust Q3 in ILC in North America in particular. On the lower part of profit and loss, you see group a net income, which is almost doubling compared to the first nine months of twenty twenty four over 1,000,000,001 billion and 22,000,000. Of course, this was heavily impacted, positively impacted by the disposal of our 23.5% stake in YUSA, which generated gains in the region of 350,000,000.

But let me say that even taking out of this obviously one off effect on our net income, the net income was very robust. And I like to confirm what I did already in the first half of the year that in terms of growth of our EPS, we are definitely above the level as at the CAGR. You remember the midpoint of this CAGR was 17% for the period twenty five, twenty four, twenty eight that we were setting last March in New York as a target. I would say we are more in the region in the first year of a 25% EPS growth for the full year versus 2024. Okay.

I flip quickly to the cash flow generation. That's the usual bridge of our net financial debt from September 24 to September 25. It's a strong deleverage, which was obviously fueled by the cash proceeds coming from the YRC disposal. You read the number on the right of this page, 66,000,000, which were definitely much higher than we expected the things to the incredibly strong share performance of the company, specifically in the month of July and even more August. In terms of last twelve months free cash flow, we are a bit below the level that we saw in the last few quarters.

You remember that we were last twelve months half one slightly below 1,000,000,000, let me say. And this is not very concerning in my opinion because it is almost entirely attributable to a different distribution of cash flows in our transmission business. To be more specific, last year, specifically in the first nine months, transmission was generating very strong cash flows because it was benefiting of a very, very large down payments and milestones that this year are more skewed on the fourth quarter. So no concern, I think that we will come back and we will regain our nice level of billion plus by the way in line with the guidance that Massimo will comment in a while. Also in terms of net debt, the boost of other than our strong cash flow, the boost of the transactions like YRC will generate a faster deleverage than we originally expected.

And I anticipate a net debt by year end in the region of the 3,000,000,000, which was definitely which is definitely much lower than the thanks also to YOC, of course. Back to Massimo for the outlook and the final conclusion.

Massimo Bataini, CEO, Prismium: Thank you. Francesco, so let me walk you through the upgrade of the guidance. On the right hand side chart, you see the evolution of our guidance for the EBITDA. We started the year with a 2,300,000,000 midpoint for full year guidance. We raised it to €2,340,000,000 in light of the perimeter change, which was in particular set by the ForEx.

So the €40,000,000 additional is the organic growth of the EBITDA of the legacy Prisma perimeter excluding the channel benefit. And now we are happy to raise it to 2,400,000,000.0. So another solid 60,000,000 additional EBITDA coming from the strength of quarter three and expectation of quarter four, of course. Free cash flow also, you you you don't see that right here, but we had 1,000,000,000 my low range, 1,000,000,075. Now we raised it 25,000,000 in the bottom range and by 50,000,000 in the top range.

So making a net increase over circa 40,000,000 in free cash flow for the full year. Let me move to the final remark about the meeting, then it's time for you to address comments and questions. So definitely a quarter which reported an excellent performance, a flawless execution in transmission, also supported by a good order intake. The benefits of the accretion of the EBITDA margin coming from the channel acquisition and the strong driver of the business growth coming from North America, our grid, I and C and transmission. We now North America really paused to benefit from the tariff benefit in the coming quarters.

So thank you. I like now to open the Q and A section and get more insight into the business.

Conference Moderator: Thank you. We will now take the first question from the line of Vivek Mehta from Citi. Go ahead.

Vivek Mehta, Analyst, Citi: Thank you very much, everyone, and good morning. Hope you can hear me well. My first question is around the I and C margin in the third quarter. Would it be possible for you give a little bit more color around where the profitability of The U. S.

Low voltage business stands and how that progressed over the course of the quarter? You mentioned that July was lower and August, September improved. And then also on that, you mentioned just now about the benefits of the tariffs in The U. S. Coming through in the coming quarters.

Could you maybe give some color around how you expect that to phase in over the coming quarters? Thank you.

Massimo Bataini, CEO, Prismium: Thank you, Vivek. So the INC space in The United States, we had many turbulence in the very months of in many months of 2025 due to the different dynamics, interpretation of tariffs in the markets. In July, we were still in the old scheme where tariffs were applied to metal, so imported metals, imports of metal and not on import cables. From August 2010 from August 13, all the tariffs were set in a way that also the metal content or cable imported were charged with 50% in addition to this coal country type. So from August 13 onwards, we had a full recognition of the fact that we are looking for local bridges.

So given that circumstances, it's August, September, we've seen a reverse in trend. While in July, we saw for pricing pressure because we had costs that imported didn't have from August from August onwards, we had certainly more even and normalized competition. Another pressure is on the importance. So the IC margin in in quarter three in US is the best ever margin achieved by anchor wire, best ever. Despite July was still weak due to the former setting of types.

We are at least at one percentage point ahead of the same quarter last year, 2023, which by the way 2024, which by the way was a strong quarter as you recall. Now how are gonna benefit from the tariffs in the coming quarters? We don't know what is gonna happen. Certainly, the supply chain from import is a long one because they're shipping cable from all every place in the world. It's normally we consider it a supply chain of three months.

So it will probably take another month and a half or so before these the points of products have been shipped and are in stock in The US will gradually run down. And so we should be seeing hopefully hopefully, certainly from quarter one onwards, lower pressure from importers and more opportunity for us to gain share of wallet. So we think that in the aluminum building space, their market started already with more progressively shift from importers whose price is not gonna is not is not gonna give them anymore a benefit into for into local local suppliers. So we will certainly have a share of wallet opportunity. Whether this will turn in additional profitability, we will see.

We'll have to gauge it. It depends more it doesn't depend on tariff. It depends more on the possible dynamics of shortage of cable availability in The U. S. Vis a vis the local demand.

Local demand is expected to grow beyond level 25, by the usual data center expansion, but also by some expectation that the residential market in light of the further reduction in interest rate will rebound a little bit in quarter one, quarter two last year and also thanks to our solidity of the nonresidential market. I hope I don't answer your Absolutely. First question,

Vivek Mehta, Analyst, Citi: And just to clarify to make sure I heard correctly, I think you said that from some point in the quarter, that was the best ever margin in Encore Wire, given that they had some very, very good margins after the pandemic. Did I hear that correctly, best ever margin?

Massimo Bataini, CEO, Prismium: Yes. July was not the best margin ever. August, September was a few points higher than the same period of 2024. So yes, you're right. Okay.

Vivek Mehta, Analyst, Citi: Thank you. And my second question is around the Power Grids margin. Just a clarification. Thank you for the color on the Midwest premium impact. Could you maybe confirm then, was the margin in the power distribution business and high voltage AC, I.

E, the business outside overhead stable relative to the second quarter? Thank you.

Massimo Bataini, CEO, Prismium: Yes. As you noticed, the blip in EBITDA margin was really minor. The rest of the product, the rest of the family inside the power grid, so high voltages, power distribution and network components were not suffering any sort of margin contraction. It's only this overhead business in The U. S.

Where we win projects is similar to the transmission space. We win one off projects, we win projects and the price in the project is firm until you complete the execution. And the new West premium has risen in the last two quarters due to the additional aluminum tariffs applied to metal imported in The U. S. We could not transfer this to The US fair price project.

Why we've been completely successful transferring this Midwest premium increase to the rest of the business, according to I and C, low voltage, medium voltage distribution. No way. We have no issue there. We have formula to reflect the cost inflation coming from Midwest Premium, Copper Road, all the rest to our customers in the existing firm agreement. In this specific niche of the portfolio probably that we didn't have the chance.

We actually renegotiated some contracts, but vast majority at firm price. So when we get past the end of this year, there is a backlog of all projects that suffered this price pressure. So this margin contraction due to cost increase will will fade away and will enter 2025, '26 with a different speed. That's why I call this blip in '21 in 2026 or quarter one, this will be fully reverted back to the original level of margin, 13% plus.

Vivek Mehta, Analyst, Citi: Very helpful. Thank you.

Conference Moderator: Thank you. We will now take the next question from the line of Daniela Costa from Goldman Sachs. Please go ahead.

Daniela Costa, Analyst, Goldman Sachs: Hi, good morning. Thanks for taking my question. I'll ask two, one on electrification and the other one on transmission. But given we just talked on electrification, just following up on the comments there you made before. I think when you think about sort of these potential impacts that you'll be better positioned versus the importers going forward on the Section two thirty two, what's your view in terms of like will your intent be to mainly just grab share because they will be much more expensive?

Or are you also planning to leverage pricing? That gap become so wide now? What are there?

Massimo Bataini, CEO, Prismium: Yeah. It's a it's a complicated answer because of the tariffs, the two to two tariffs, first of all, been only applied to imported cables in the aluminum space. We expect the same treatment in December 1 to happen from December onwards, wherein also for copper products imports, there will be the same logic. So the metal content of cable, copper cable in part in US will will be charged with the same 50%. So but this still has to happen.

But our our interaction with the administration suggests that also for the copper space, this will happen. Should this happen, we'll have electrification, power grid, overhead, high voltage businesses where we where we see our position in US is stranded by the fact that imports have additional additional costs to to to live with, to bear with. Some of those important decided to eat this cost, they start to digest it. So they didn't increase the price. But now after three months, we noticed their attitude or their their their their their chances to hold the same price and getting charged with this 50% of metal content and on top of countryside is becoming too overwhelming for them.

So we expect to see reduction of imports of cables across the board for all importers in US in high voltage, low voltage, medium voltage and electrification. So this reduction of supply to The US driven by the stream cost cost impact due to tariff will certainly create some imbalance in the market. So we think that the first immediate benefit will be the share of wallet. And it's too early now to say whether on top of the share of wallet, we also have a price benefit. But be reassured that every time we had a chance to increase price and to improve profitability without losing share in the market, market, we go for it as we've done in the last nine months.

The market was not that strong, but we haven't saw a particular EBITDA margin erosion in any space in The United States. Despite tariffs were not in favor of local produce. So price, we would say, certainly share of wallet is within reach.

Daniela Costa, Analyst, Goldman Sachs: Thank you. And moving to the question on transmission. I mean, as you've mentioned, you're pretty much there sort of at the 18% and there's upside, as you said, to the 18% to 20% or that you are comfortably in there in the 18% to 20%. But the backlog is not dramatically different to the backlog we had at the CMD. So I guess you had visibility on sort of like what the gross margin on those projects were.

So can you elaborate what you changed in execution and whether this is something that we kind of see has more longer lasting? In that case, what is the ultimate ceiling of transmission margins?

Massimo Bataini, CEO, Prismium: To be honest, we also have to be more accurate in setting the target for '28. So the 17.8% today is based on the standard metal. Should we base also the 18%, 20% target on the same standard metal, so the historical metal ten years ago, we should naturally raise 1820 range to 18 and a half to 20.5. So in my view, the natural ceiling is 20.5. It's the top of the range.

It's the top of the range because it is true that the backlog is what it was six months ago. We've definitely been more successful or better able I'm sorry. More successful than anticipated the execution, let me say. And and some of the risks that we were in our execution and that we quantified and we assigned to provisions that didn't materialize or we handled them with lower cost than anticipated. So it's again back to the execution, the strong team, strong assets.

So don't forget, we have now plenty of new assets and the new Mona Lisa is a new super performing installation asset with different capability than Leonardo da Vinci. As Alessandro Volta, the asset who joined our fleet in December 26, has a different set of capability as well. So we have different tools for installing bearing cables underground. We have new factories. We have new vertical lines in Bicola that has come to chemistry that came to stream at beginning of this year.

We have a new production line in Arco Fiddisho. We have a fantastic new asset. Our cohesive team working with strong focus on execution and this is what has driven the significant uptake in EBITDA margin in quarter three. And this has given us confidence that the 20.5% top of the range is also achievable by 2028.

Daniela Costa, Analyst, Goldman Sachs: Got it. Thank you very much.

Conference Moderator: Thank you. We will now take the next question from the line of Max Yates from Morgan Stanley. Please go ahead.

Max Yates, Analyst, Morgan Stanley: Thank you. Good morning. Just my question is on capacity utilization in your Encore facility. So you've kind of mentioned there may be the opportunity to take share and take customer wallet share from as a result of the tariffs. So could you just give us a sort of indication of if 25% of the market is going to be challenged by these tariffs, how much can you ramp up your Encore facility in the next one to two years to maybe take advantage and knock out some of that competition that then has to put through higher prices?

So yes, where is the best utilization and sort of

Sean McLaughlin, Analyst, HSBC: how much room do you have?

Massimo Bataini, CEO, Prismium: Thank you, Matt. So our strategy is pretty simple. We have spare capacity in the range of 30% in anchor wire, which is not there in other wire because we like to have spare capacity. It's there to guarantee the service. But in case we need it to respond to fast respond to market demand, we can utilize the Saturday and the Sunday shift to expand this capacity and leverage this available incremental output.

Of course, in a short term, this will be the answer. But as soon as we see stronger structural demand growth, will resort to the short term action to gain share, and then we back up this action with additional investment, which might take twelve months, thirteen months. It depends on what we're gonna do in terms of where we want to spend capacity. Of course, it would be McKinnon, but in which line. So short term, we respond with the shifts available shifts in Sunday, Saturday, and Sunday.

To avoid to compromise the the long term in the long term, the service level, we will immediately activate the CapEx deployment to increase the structure of the capacity. So we are the only one with these benefits. Thanks to Anco. We didn't have it in the prisoner because prisoner run facility at full at full capacity, sat on seven days a week. At the same time, the other the same to the other place in United States.

So with this opportunity, we can certainly leverage it, the tariff in better way than the other people and offer this to gain share in the market.

Max Yates, Analyst, Morgan Stanley: Okay. And maybe just a second question around what the competition are doing in North America, because I guess, when we look at Encore margins, they're clearly at very attractive levels. Obviously, your biggest competitor, Southwire, is private, so it's harder to keep a track on kind of what they are doing. But when you speak to your sort of salespeople, what do they say about what the competitors are doing on capacity? How much availability do they have to ramp up?

And are you seeing kind of new entrants or people expanding capacity that maybe you didn't see before, given how attractive margins are now in this North America?

Massimo Bataini, CEO, Prismium: Yes, the margin attracts new interest from our side really not coming because of the challenges. So there could be new interest from this side, I doubt it. The copper building wire market is in the end of two players, Sadwire and Xero, and the aluminum building wire is in the end of us and Sadwire. The rest are important. So behavior in the market is pretty simple to define.

Sadwire is very disciplined when it comes to price. Of course, they are suffering more than in the past because they are too exposed to the residential market. They have a significant exposure to residential market. This market has been sluggish and flattish over the last two years. And so they're probably not enjoying what we've been enjoying on the contrary, our side, because with electrification space, again, from anchor wire, we have a huge exposure larger than before to the nonresidential space.

And on top of the nonresidential space market, we have access to data center, stronger than anyone else because we have a product range, very broad, large and complete, from telecom to electrification to power grid to transmission, which is unique, not common to our telecom player like calling on Costco, not even common to satellite. So they are disciplined. They are always follow our price. Sometimes they are the first set price increase the market. For example, the last two weeks, we've seen copper increasing, increases that forced us to increase the price, but supplier anticipated us.

They came with a price increase in the market first. So we are happy about the level of competition. Whether they have spare capacity, I don't know. But, you know, what matters to this market is the service level. So if you have gained so much share in data center space, it's because we serve these demanding companies, the likes of Microsoft, and so on and so on with our twenty four hour service.

It is because with the three two days spare idle capacity, then we can we can respond with massive output increase that other people cannot respond to. So we are well positioned to leverage now the settlement achieved by the tariffs in the market to leverage our strength, our portfolio and the asset of McKinney and gain additional share in the market.

Max Yates, Analyst, Morgan Stanley: Very clear. Thank you very much.

Massimo Bataini, CEO, Prismium: Thank you, Max. Thank

Conference Moderator: you. We will now take the next question from the line of Sean McLaughlin from HSBC. Please go ahead.

Alistair Leslie, Analyst, Bernstein: Thank you. Good morning. Can I just build on the previous answer? Maybe could you specify what kind of growth you've seen in data centers maybe across the different divisions? And my second question is related to fiber, particularly if you could maybe split out the growth in digital solutions in The U.

S. Versus other regions? And particularly, if we're looking at fiber shortages in The U. S, what kind of positive pricing impacts do you expect this might have over the coming quarters? Thank you.

Massimo Bataini, CEO, Prismium: Thank you, Sean. In data center space, we've seen our revenues nine months to date versus nine months last year, doubling in value. And this is pretty much across two main spaces, electrification US and optical digital solution US. So now the in the optical space, 40% of our volume, traded volume US belongs is is is for serving this data center business. And and in electrification, I say that we have 25% of the total certification business, RNC business, US attributed to the data center expansion.

This is not the same that we've seen in other regions yet. We are still working in Europe and in LatAm and APAC to become more relevant, to become more engaged with the go to market, with the proper supply chain to win more share in data center space also as well. As far as fab is concerned, you are top right, there is a shortage of fab in The U. S. To the point that we are really backfilling our capacity The U.

S. We have a fiber in U. S. Producing fiber with fiber production coming from Europe. Price improvement has happened in quarter one.

Quarter two is happening as we speak. And so we cancel this pricing profitability announcement in the coming quarters to set new level of EBITDA for optical digital solutions business U. S. Next year.

Vivek Mehta, Analyst, Citi: Thank you. Thank

Conference Moderator: you. We will now take the next question from the line of Monica Bosio from Intesa Sanpaolo. Please go ahead.

Monica Bosio, Analyst, Intesa Sanpaolo: Yes. Good morning, everyone. And I hope you can hear me. The first question is on from a strategic standpoint, Massimo. If I'm not wrong, in occasion of a recent interview, you anticipated that Prizmion could be ready for a big acquisition in 2026 in LatAm or Europe.

Can you please give us more flavor on this side? And just a question, would you see as reasonable an external growth in the digital solutions space or in other areas? That's the first question. The second one is related to Sean's question in the digital solution space. So pricing is coming.

So what kind of margins could we expect on a steady state in the digital solution space? And more in general, given the exponential growth of the data center, do you see any supply constraints or disruption that could bring to some stop and growth along the trajectory? Thank you very much.

Massimo Bataini, CEO, Prismium: Thank you, Monica. So yes, this our position regarding M and A is the unit one. We consider M and A the natural to top top up our organic actions, organic plans. We think we are well positioned based on our track record m and a's to leverage additional opportunity. We will be ready for large ones.

And by large ones, I mean, something closer to the size of Bancorp from 2027 onwards, not in 2026. We have some more financial flexibility also for in 2026 due to the disposal of one of your shares of the treasury shares. So we have still some room for minor mid size acquisition '26. And now the point is to work in identifying the specific targets. The one that we can start the highest level of synergies is certainly looking at North America, LatAm and Europe as main priorities.

To expand leadership, expand portfolio, they become more relevant within the customer base. I didn't catch the question about the standard growth in digital solution. You mean the the organic so there is growth in USA in digital solution, again, partly driven by the rollout of fiber to the home and also complemented by the rollout of data center expansion. There is not that much level of growth in the other countries because they are much more advanced in the fiber to the home implementation. France is almost at the end.

The UK is almost at the end. The Spain is midway through. So Europe will not probably give us satisfactory organic growth. North America will continue for five years, at least, to support the organic growth of digital social space.

Monica Bosio, Analyst, Intesa Sanpaolo: Yes. My question was sorry, Marcelo. My question was given the pricing that is coming in The US in the digital solution, this could be a lever for a furthering margins improvement. What do you say?

Massimo Bataini, CEO, Prismium: Go go, Monica.

Monica Bosio, Analyst, Intesa Sanpaolo: I'm here.

Massimo Bataini, CEO, Prismium: Okay. So so the margin was coming to the point of margin. We reached a 20% EBITDA margin. So I think it's the level we consider sustainable. There will be upside in US.

There will be probably stability or slight reduction in Europe. So I I would not bank on a significant expansion beyond 20%, which is already very accretive vis a vis the past trend. Of course, there will be additional synergies that we want to leverage thanks to the acquisition of channel because now we own a satisfaction portfolio of connectivity products with the one that we had in Europe, with acquisition that we made, a small acquisition that we made in Australia, the Warren and Brown end channel. Now we can leverage the full portfolio and eventually further enhance the profitability of the business unit.

Monica Bosio, Analyst, Intesa Sanpaolo: Okay. Very clear. Very clear. Thank you.

Massimo Bataini, CEO, Prismium: Thank you, Monica.

Conference Moderator: Thank you. We will now take the next question from the line of Alistair Leslie from Bernstein. Please go ahead.

Alistair Leslie, Analyst, Bernstein: Yes, thank you. Good morning. I had a few questions on transmission. So you talked about 2028. I was just wondering whether you could help us a little bit in terms of kind of calibrating how transmission scales up here in maybe the next six to twelve months?

I mean, how should we think about top line growth margins both in balance of 2025, but maybe also 2026 as well? Any early thoughts there as consensus only has around 15% like for like growth in 26%. It feels like maybe that's now too conservative. And maybe also just a little bit more detail around the phasing of capacity coming online, please. I don't know whether you can kind of update us on those lines at Piccolo, the first one.

Think you highlighted again, that's up and running. But the second one, maybe an update there. Can that be brought forward a little bit? And maybe if you can, what's the kind of run rate on that submarine cable now in Piccolo? I think you talking about starting with 32 tonnes and wanted to double that.

Where do we stand now? You.

Massimo Bataini, CEO, Prismium: Thank you. Your question is too detailed. I don't like to share all this stuff with, not with you, but with the other people connected to the earning goals. I'll tell you a simple explanation of what's going on. You draw a line from twenty six, twenty five to twenty twenty eight, And you take the let's call it $505,180,000,000 EBITDA this year and take care of the almost 1,000,000,000 by 2028.

This growth from $5.50, $5.80 to 1,000,000,000 is supported linearly by additional capacity increase across many site. There is PICCALA with three lines. There is drone for HVDC interconnectors with three lines. There is Naples with one additional line. There is capacity in Abbeville, United States for HVDC capability.

The capacity will grow linearly for linearly from this level of 2025 through 2028 from five fifty, five eighty million EBITDA this year to one beta. On on to complement this cable capacity across different segments with submarine interconnectors, offshore and land interconnectors, you have the installation capacity that will grow end in end with the manufacturing capacity. So you draw this line, you can figure out what the organic growth for next year will be and for '27 and for 2028. Bear in mind that while we grow and expand the business organically with capacity and with expansion of installation capability, we also benefit from, as we did in quarter three this year, is a cushion and better margins in our backlog. So move from the 17.8 EBITDA margin of today to 20%.

I hope this clarifies the trajectory. And forgive me if I cannot enter into these tons, kilometers details that really we don't like to share with our peers.

Alistair Leslie, Analyst, Bernstein: So appreciate that. Thank you for the detail.

Massimo Bataini, CEO, Prismium: Thank you.

Conference Moderator: Thank you. We will now take the next question from the line of Uma Samlin from Bank of America. Please go ahead.

Uma Samlin, Analyst, Bank of America: Hi, good morning, everyone. Thank you very much for taking my question. My first one is fairly short term. You mentioned that for Encore, you saw record sort of margin profile in September and August this year. So what are you seeing in terms of anchor demand and pricing so far in October?

If you could comment on that, that would be really helpful. And then also for your raised 25% guidance, how much have you accounted for in terms of the tariff impact on INC in Q4? How should we think about this benefit going into 2026? That's my first one. Thank you.

Massimo Bataini, CEO, Prismium: Thank you, Herman. So the record margin August, September is certainly an important certainly an important trend in the market. It is not really related to the tariff per se to the reduction of imports related to the fact that there is clarity in the market about where the market stands in terms of tariffs. Portugal is coming in with a strong volume with some pricing or margin pressure due to the cost of copper cost increase that has been kind of sudden and and sharper. And, of course, us, Sartweil, all keen on passing into the market.

So October is coming up in a nice way as well. And and the big chunk the big chunk of the 2025 upgrade guidance upgrade comes from North America due to the strength in power grid and IHC, but also it comes from transmission business. So those three family of products, IHC, North America, Power Grid, North America and also Europe to a certain extent and transmission is what has driven the 60 meter EBITDA increase in 2025 guidance upgrade.

Uma Samlin, Analyst, Bank of America: That's super helpful. Thank you very much. And my second question is a slightly more longer term. Is that how should we think about the sustainability of this tariff benefit you're seeing now? Do you expect to see further consolidation of the market?

And what kind of long term pricing benefit do you expect there?

Massimo Bataini, CEO, Prismium: It's a million dollar question because we've never been a situation like this where finally The U. S. Market is that's historically been super protected against importers will be even further protected. So give us couple of quarters to reassess what the situation would be. I think that things went in the in the way I think they would go, there would be significant reduction on imports of cable in The U.

S. In favor of local producers. As said before, we have capacity available to respond to this sharp market demand And we have CapEx and capital allocation available to be released to support the organic growth of the market in U. S. As we've done in the past, we'll do in the future, the market becomes more solid, more protected in the end of few players.

It's already kind of highly consolidated. And we made the last move in consolidation with the acquisition of Concordia.

Uma Samlin, Analyst, Bank of America: That's very clear. Thank you so much.

Sean McLaughlin, Analyst, HSBC: Thank you.

Conference Moderator: Thank you. We will now take the next question from the line of Nabil Najib from Deutsche Bank. Please go ahead.

Sean McLaughlin, Analyst, HSBC: Yes. Thanks. Good morning. My first question is on data centers. Your direct sales into data centers have, of course, been very strong.

I think you previously said that you're on track to double data center related revenues. Can you give us a sense of how you might look at the overall opportunity within data centers? I wonder if you've got any thoughts on the share of data center CapEx you can maybe capture across low and medium volt voltage cables as well as fiber and connectivity? And the second question is on the New York listing. Do you have any updates on your plans there?

I think earlier you wanted to focus on the integration of Encore and channel, seems to be well underway. There were also some headlines in the press on a potential revival of these plans. So just wondering if you can comment on that.

Massimo Bataini, CEO, Prismium: Sure. Thank you, Daniel. So this is a center. We've seen a significant growth in 2025 or 2024. We think that the growth will continue.

We have a vis a vis of long pipelines of projects, and we'll become stronger and stronger as time goes by because we add the innovative solution to our product range that can really benefit the data center. In the optical space, they require high density cables with very compact standard diameter. And we just I know we cannot announce it today, but we we have a breakthrough that we'll disclose to the market shortly in terms of size of fiber for compact cables for data center. So we will be really benefiting from data center expansion. I think the growth per se will probably slow down because this year we've seen 150% growth over last year.

So the pace of growth will probably slow down. But still remaining this will still remain an important driver of EBITDA expansion and EBITDA margin increase in US for sure massively and also in other regions. US listing is not an abandoned project. It's something that we partner for a few for for a moment. I think you are correct.

The integration of ANCO is proceeding well. The channel integration is also proceeding well. We will we will reopen the discussion in 2026. The project is extremely valuable to us. It will give it will give access to this company to many U.

S. Based investors, it is a priority for us. At the moment, we made the proper decision.

Sean McLaughlin, Analyst, HSBC: Great. Thank you very much.

Massimo Bataini, CEO, Prismium: Thank you, Anambi.

Conference Moderator: Thank you. We will now take the next question from the line of Chris Leonard from UBS. Please go ahead.

Massimo Bataini, CEO, Prismium0: Yes. Hi, all. Hopefully, you can hear me. Just digging in maybe on the margin differential again between North America and Europe. And I wonder in the Electrification division for Q3, weakness in Europe was dragging margins down?

And could you maybe speak to the potential for you to bridge the gap in the future and grow European margins? And is there anything in your strategy you're looking at to try and improve that? And maybe is M and A into '26 or '27 an avenue that you would pursue within Europe? Thanks.

Massimo Bataini, CEO, Prismium: Yeah. You're right. There is a significant difference in mind between North America and Europe. While in other regions, for example, LatAm, we have similar margin to U. S.

So but Europe is not one margin fits all. It's a strong margin in The Nordics, a weaker margin in the South Of Europe. Now how to bridge this gap? We are trying to implement similar mindset as the one we have in Yankarawi also in Europe. So to leverage or to value the service more than the output of the factory.

So to make sure that we become more appreciated by customer for the short term lead time, for the short term service than anything else. Differentiation in sustainability and innovation is basic is also important. Have a gap to cover, and we are really working across all drivers, fixed cost organization, fighting footprint and possibly consolidation of the market in Europe to bridge this gap. Bear in mind, there is a structural difference between the fermentation US market, which is minimum, and the fermentation of the European market, which is extremely large, both on customer side and supplier side. But we're working hard to reduce and minimize as possible this gap.

Hope I answered your question, Chris.

Conference Moderator: Thank you. We will now take the next question from the line of Akash Gupta from JPMorgan. Please go ahead.

Massimo Bataini, CEO, Prismium1: Hi, good morning and thanks for your time. I got a couple as well. The first one is the clarification on your remarks earlier. I think you said that Encor had all time high margins. And clarification, is this all time high since you acquired or in the history?

Given question given in 2022, they made more than 30% EBITDA margin. So just wondering if you can provide some context to these record margins at EMCORE?

Massimo Bataini, CEO, Prismium: Yeah. Thank you. That's an important clarification, Akash. Yes. You're right.

This is not the old time ever. It's the old time. Not since you acquired, it's the old time since the level of EBITDA margin at Encore normalized. Level of margin in Encore normalized after the start in '22 and '23 towards the end of 2023. And since then, so let's say, 04/2003 onwards, we had this kind of stable EBITDA margin of 15% with some peaks and troughs, especially in 2025.

So the EBITDA margin, as ever mentioned in quarter three, is the highest since quarter four twenty twenty three.

Massimo Bataini, CEO, Prismium1: Thank you. And my second question is on your guidance range. I think if you recall last year, you had a bit of softness towards end of the year in Electrification because of some weaker volumes in end of the year, which also continued in early this year as well. So just wanted to understand the framework behind the guidance range that have you incorporated a similar scenario as well for this year? And maybe if you can also talk about what will take you to the upper end of the range and what will need to happen to come at the bottom end?

Thank you.

Massimo Bataini, CEO, Prismium: Yeah. Thank you, Okemos. So, yeah, you're right. Last year, we had a soft volume performance in November, December due to seasonality, but also due to some shortage in in demand. October started very strong in volume, and we have a visibility of a part of November.

Don't forget that this is a very short short business. We have we enter the month, and we we we gain the orders of the month through the month itself. But prospect is positive. Probably, in October is a first reflection of some slowdown in cable imports so that there's more demand for local producer. Volume is positive.

We think that quarter four this year was also the extremely satisfactory versus quarter four last year. And so this this this expectation for quarter four, IAC West has played an important role in the guidance of a grade. But also the performance of power grade that at the global level was in the quarter 14% organic growth, but in North America much more. And the growth we expect to see from North America in quarter four is in line with what we've seen in quarter three. So also, probably, The US has played as important role in convincing us to upgrade the guidance to a midpoint to point four.

And we think we will end up around the midpoint. So to be in the top part of the range, we have to have to think of something that we don't think is realistic. So an extremely important shift change in the market to a local producer, important, deciding to work away, pricing going to a different level. So a scenario that we don't see realistic. So the tariff will play an important role benefiting us, but this will gradually kick in in the market.

So I don't see this spike possibly happening in quarter four. Gradually, we will gain, as I before, more share of wallet, more relevance, and the importers will be neglected. They will be really considered the last resort also because they won't have the only leverage that they had in the past to enter the market, the price. Price will go because the cost they have to bear is is immense. So this is how I see how I how we drafted the guidance and how I see we will end up vis a vis the different business movements.

Massimo Bataini, CEO, Prismium1: Thank you, Maximil.

Massimo Bataini, CEO, Prismium: You're welcome, Akash.

Conference Moderator: Thank you. We will now take the next question from the line of Alessandro Tortora from Mediobanca. Please go ahead.

Massimo Bataini, CEO, Prismium2: Yes. Hi. Good morning to everybody. I have three questions, okay. The first one is on the channel performance on a stand alone basis.

If you can comment a little bit the organic performance of the company, but also the underlying profitability. This is the first question. The second one relates to the around billion net debt indication I got in the conference call. So if you can help me to understand the underlying assumption at all on CapEx. And also, if you are assuming, let's say, significant, let's say, advance payment in the last part, I maybe recall to the Eagle Ford in case?

And then last question is on the is on, let's say, sorry, I joined the call lately, but if can also give me some ideas on the tax rate level for this year because it was, let's say, pretty low in the nine months and also the level of financial charges. Thanks.

Massimo Bataini, CEO, Prismium: Thank you, Alessandro. The channel benefits from the strong rebound of the telecom markets. The channel performance in quarter three twenty twenty five is well ahead of quarter three twenty twenty four. As also North America, our performance in optical cable business, '25 is ahead of that of last year. The market has rebounded.

So China benefit from organic growth benefited, organic growth upside, but also profitability upside. The level of EBITDA that used to be in the range of 40% in 2024 is has has risen to a more solid 43, 44% for quarter three this year. So we have this two fold benefit coming from channel, which, again, given the strong demand of optical business US supported by use cases by data center and fiber to the home, we believe that it's gonna be sustainable in the in the coming years. I lend it to and over to Francesca for the NFP

Alistair Leslie, Analyst, Bernstein: Yeah.

Massimo Bataini, CEO, Prismium: And let's answer your two questions.

Francesco, CFO, Prismium: Yeah. Good morning, Alessandro. The assumptions are pretty Mhmm. Simple on the 3,000,000,000 debt. First of all, let me highlight that the 3,000,000,000 debt, of course, assumes the is is is based on the treatment of the hybrid bond as equity, just to be very clear on that point, which is the according to IFRS.

So that's nothing new, but better to to clarify. The assumption is that we are in the midpoint of the guidance of the free cash flow that Massimo highlighted. And, of course, in this assumption, there is the down payment of AGL four. No doubt. And I, by the way, I commented that the reason why we are confident to recover the level of the free cash flow on a full year base after the drop down to $8.59 last twelve months of September is exactly a very strong cash generation of transmission business, which is more skewed on this fourth quarter than compared to last year.

Nothing else on the extraordinary transactions. Why you see it's been completed And so these these will not impact will not have a different impact from the one that you see in September. You are right. The tax rate is very low. The reason why it's very low is a technical reason, I would say, accounting reason, which once again has to do with the disposal of YOSC, basically the big gain of $350,000,000 as a pretty low level of taxation.

And they so I expect that these are to be stable also in the full year around '22. It's a it's a good point that you made because it's not certainly our sustainable Long term. Tax rate would be too nice to be true, Yuri. I go back to the indication that I gave at the Capital Market Day where our sustainable tax rate is more in the between '25 and '27, I would say. And the financial charges are reflecting obviously the acquisition done in the past.

The new financing are progressing quite steadily at $70.70 something million a quarter. So an easy projection is in the region of the 285 or 200 and let me say, between 280, 290 for the full year versus the 216 year to date September.

Massimo Bataini, CEO, Prismium: Okay. Thank We

Conference Moderator: will now take the final question from the line of Xing Huang from Barclays. Please go ahead.

Daniela Costa, Analyst, Goldman Sachs: Hi, there. Thank you for taking my questions. Good morning. I'm not sure if I'm the only one confused here, but I want to clarify one thing. So on the tariff impact, I think you explained how the aluminum tariff works, which is in July, it's applied to metals, not to cables.

Therefore, you saw cost pressure in July. And then by August, it's expanded to cables and you saw the best margin of Onco. And then you said we expect the same logic to apply to copper. Does this mean that we haven't really seen the tailwind from the copper side this quarter yet? And do you expect this to come in the coming quarters, please?

Massimo Bataini, CEO, Prismium: Thank you, Shin. Yeah. You are correct. You are totally correct. Two to two secondtion tariff applied to metal has been in expanded to import cables as far aluminum cable is concerned from August 18.

And our our interaction with the administration suggests the same logic we will apply to COP. This would probably take another quarter to be implemented. So we expect this to happen from somewhere in quarter one twenty twenty six onwards, sir. Then, of course, the copper space is not that relevant as aluminum space. So 30% of the aluminum IEC market is in the end of importers.

In terms of copper building wire market, they are barely importers, importing copper cable in U. S. In electrification, in IEC. But there are cable imported in U. S.

Copper made in medium market space and by distribution in HBSC. So we will not see a significant benefit of the two thirty two types of applied to import cables in IEC space, we will see some benefit in power grid and high voltage should this approach be implemented at some point in the coming months. I hope I clarify this difference between the two family of products, aluminum and copper.

Daniela Costa, Analyst, Goldman Sachs: Yes. No. The first part is very clear. The second part, just wanna clarify, this is what I heard. Potentially, when we look at the benefit from copper and aluminum tariffs, being it on the I and C front or the power grid or transmission front, you expect aluminum imports to be a more structural benefits that takes some time to flow through.

Obviously, part of that is because aluminum imports penetration is a lot higher than copper and also it's less exposed to the spot market.

Massimo Bataini, CEO, Prismium: Yes, correct. So is the aluminum space, I mean, cables are lighter than the copper cables. That is why U. S. Is importing as other regions are importing more aluminum cable than copper cables.

The aluminum space is inside the electrification space and that's the construction. The aluminum cables are also inside the power grid. For example, overhead lines are mostly made of aluminum conductors. And so a chunk of the overhead transmission business that we own in The U. S.

Competes head to head with importers bringing overhead transmission line from India and from China and other countries. And now also these important that enter into the power grid space through overhead transmission line will fill the extra cost of the 50% tariff applied to metal content. And the conductor of red lines is only made of conductor, not installation. So there are other benefits to come through. Again, I really suggest to to pause a bit on tariff.

It's not too big of a deal. We just had finally settlement in aluminum that will be copy pasted by COPPA approach in the few next months. We will really need few months to gauge the entire benefit. But be be aware that we are really structurally posed to benefit from it. We have capacity available.

We have a larger engagement with all major distributors and utilities in The US. To have a strong connection with all customer. So we will be the beneficiary of the tariff in a way or the other. And this has started to happen in July, in August and September for the IAC space and this will carry on in the future.

Daniela Costa, Analyst, Goldman Sachs: It's very clear. Thank you very much. We can totally afford to be a little bit more patient. My last question is on the high density fiber cable and system. You talk about the opportunity out there because your peer, Corning, obviously, is also talking about the same thing.

I know you have made a technical breakthrough, do you can you already share some thoughts if there's any customer dialogues started already or how do you think about the investment that is required out there? And on top of this, I think you made a progress with channel acquisition, but you previously also said you intend to grow to expand the portfolio offering on digital solutions. Do you have any progress to share, please?

Massimo Bataini, CEO, Prismium: So we keep working on innovation and currently does the same course. We have extremely we think that we have at least two but Please don't make me share what we think of the other competitors. We have strong effort in innovating in in fiber, making very, very thin fiber solution and very compact cable solution. We're working on the Holocaust fiber, which is a new generation of fiber to increase, speed of transmission of data, which is key for data center rollout. And we're working on very super compact super compact cables that are also key for data center because they have little space in that, and they want to squeeze as many fiber as possible in this short short room, short space.

So innovation is our key driver of profitability and volume and share enhancement in digital solutions space. You mentioned also channel. Channel give us a range of products in connectivity that is completely complementary to that we are in Europe. And so now we will do a cross selling. We would like to use the channel products and sell them in European markets using our go to market channels and do opposite, the complementary using our European portfolio connectivity and bring it to The U.

S, benefiting from the channel to the market that channel has. So the go to market channels, channels the way to market that this company we acquire as, which we didn't have before. So cross selling of connectivity ranges, European one in US and US one in Europe is what we expect to deliver to our EBITDA in the coming quarters.

Daniela Costa, Analyst, Goldman Sachs: Very clear. Thank you very much.

Sean McLaughlin, Analyst, HSBC: Thank you.

Conference Moderator: Thank you. We will now take the next question from the line of Luigi Develis from EquitaZim. Please go ahead.

Massimo Bataini, CEO, Prismium3: Hi, good morning. Just one quick question for me. You share your current strategic view on the submarine subsea telecom business? So are there any plans to renew the interest in expanding or investing in this area, considering market trend or potential synergy with your existing transmission and telecom activities, but also different business model, if I am not wrong. So if you can tell some view

Massimo Bataini, CEO, Prismium: on Yes. The Let me share what I can because talking about strategy strategic decision, I cannot share much. Certainly, we have a business inside the the transmission space that is called telecom summary. We are a small player because we we can only play in regional connections. So short language, summary, and telecom connection.

We we have noticed that the market has certainly increased a lot in size because the data center expansion plays significant role in the standard market between especially in terms of long haul submarine telecom interconnects or plant interconnects, so US, Europe, and so on. So some players, the key players in the market have neglected the original space. So we are thinking of expanding our presence in our portfolio in the regional so short distance, midsize, short distance, submarine telecom connection to organic moves and additional investments. I have to stop here, but we want to make this another opportunity for supporting transmission growth with another stream of revenues, more solid and more growing than what we are currently in our portfolio. I hope I gave you the sense of the strategic direction without giving too many details.

Massimo Bataini, CEO, Prismium3: Thank you.

Conference Moderator: Are no further questions at this time. I would like to hand back over to Massimo Patrayini for closing remarks.

Massimo Bataini, CEO, Prismium: So thank you for your time and for your attention. We really want to give you the sense of what's happening, a strong quarter and a more than strong quarter, a good feeling for quarter four and what we think is going to turn out for us an opportunity in terms of tariff, organic growth, tariff transmission growth in the coming quarters. So thank you very much for your time and talk to you soon.

Conference Moderator: This concludes today's conference call. Thank you for participating. You may now disconnect.

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