Prysmian's Data Center Pivot: The Molex Deal and a Record Quarter
The cable maker shifts from cyclic to fast-growth with a massive hyperscaler agreement, raising guidance and redefining its portfolio.
PRY.MI · Earnings Call · 2026-07-30
Introduction
Prysmian's second-quarter 2026 results were nothing short of a turning point. The company reported its best quarter ever, with EUR 730 million EBITDA and a 13.4% margin, but the real headline is a EUR 10 billion optical space agreement over the next decade, including a EUR 5.5 billion deal with Molex. This is a strategic pivot from cable manufacturer to scale data-center solution provider. As CEO Massimo Battaini put it, “this is the best quarter ever of Prysmian, EUR 730 million EBITDA, 13.4% EBITDA margin, 9.4% organic growth.” — Massimo Battaini, Chief Executive Officer · 2026-07-30
The Data Center Pivot
The core of the story is the acceleration of Prysmian's data center exposure. The company signed framework agreements with hyperscalers and Molex, covering over EUR 10 billion of cumulative optical data center revenues. The CEO explained the trajectory: “The path, Daniela, is pretty linear through 2029 because the shortage in the market will continue until then.” — Massimo Battaini, Chief Executive Officer · 2026-07-30 This is a sharp departure from the past, when the optical business was dominated by fiber-to-the-home. Now, the company is reallocating capacity and shifting its product mix to serve the data center boom. As Battaini emphasized in a block quote from the call:
When you look at the 2031 perspective, you see that 90% of our revenues and even more in terms of EBITDA belongs to data center expansion.
This transformation is not just about revenues; it's about margin quality. Digital Solutions delivered a 24% EBITDA margin, surpassing Transmission's 21%, and management expects that to keep climbing. The company is also investing in capacity expansion to meet demand, including a second wave of deals beyond the EUR 10 billion frame.
Guidance and Financial Performance
The financial impact is dramatic. Prysmian raised its full-year EBITDA guidance from EUR 2.7 billion to EUR 2.850 billion, with management confident of hitting the upper end. The free cash flow guidance was lifted to EUR 1.7 billion, aided by a EUR 550 million down payment from Molex. CFO Pier Facchini noted, “we plan an extremely strong second half on the back, of course, of the contract with Molex, which will bring in a very substantial down payment.” — Massimo Battaini, Chief Executive Officer · 2026-07-30 This is a far cry from previous years, when the company was still integrating acquisitions like Encore Wire. In a prior call, Massimo Battaini had discussed capacity constraints: “We are at capacity in fiber and cables. And so we will maintain a level of EUR 800 million CapEx also for 2026 to support the organic growth across all the 3 businesses that I mentioned.” — Massimo Battaini, CEO · 2026-03-02 Now, that CapEx is being amplified to build out data center-focused capacity.
The contrast with earlier quarters is striking. Just a year ago, in October 2025, the CEO boasted about Encore Wire's margin: “The I&C margin in quarter 3 in U.S. is the best ever margin achieved by Encore Wire best ever.” — Massimo Battaini, CEO · 2025-10-30 But the center of gravity has shifted to Digital Solutions. The company is also deleveraging faster than expected, with year-end net debt now seen below EUR 2.4 billion, implying leverage of around 0.8x.
Conclusion
Prysmian is executing a clear and timely pivot. The Molex deal and hyperscaler agreements provide a secured growth runway for the next decade, fundamentally changing the earnings mix and margin profile. The market reaction (though not captured in the provided price tape) is likely to be strong, as the company is no longer a cyclical cable maker but a growth-oriented partner to the AI infrastructure buildout. With a new Capital Market Day planned for early 2027, investors will get even more color on how far this transformation can go.