Atos says its restructuring plan remains on track despite downgrading its financial projections for the next three years as clients terminate their contracts with its infrastructure unit.
In a market update issued on Monday, the struggling French IT giant said it had cut its expected revenue for the next three years to “reflect the results of the first half of 2024, current business trends and the expected impact on the group’s free cash flow.”
It only published its original business plan for 2024-2027 in April.
Atos expects revenue of €9.7 billion ($10.7 billion) in 2024, having previously predicted €9.8 billion. Its longer-term revenue for 2027 has been reduced to €10.6 billion ($11.7bn) from the €11 billion it forecast in April.
The statement from Atos said: “The updated business plan takes into account the current weaker market conditions and business trends in key regions of the group, as also reported by the wider industry. It also reflects the impact of contract terminations as well as deferrals in the award of new contracts and additional work, as customers await the finalization of the group’s financial restructuring plan.”
It went on to say that the impact of the contract terminations had been most heavily felt in its Tech Foundations managed IT infrastructure business.
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However, Atos said the changes will not have an impact on its recovery plan or the amount of cash it requires to continue trading.
As previously reported by DCD, Atos has been struggling to come to terms with its debt and owes €4.65 billion ($5.05bn) to its creditors, €3.65bn ($3.9bn) of which is due to be paid back by the end of 2025.
In July, it agreed to a rescue package that would see its creditors take control of the business, with bonds and debt worth €3.1bn ($2.9bn) converted to equity. The creditors will also provide €1.68bn ($1.81bn) of new debt and €233 million ($250.7m) in new equity.
The market update said this is likely to be finalized early next year.
Also in July, Atos named its sixth CEO in three years, with company chairman Jean-Pierre Mustier replacing Paul Saleh, who had only been in post since January 2024.
The company operates five of its own data centers according to Data Center Platform, three in France and one each in Austria and Germany.
