There are 3 different outcomes for the situation:

If the Guelphs win, all countries with a capital in the Italy region will be forced to leave the HRE

If the Ghibellines win, all countries, except Naples, Sicily, the Papal States, or the Two Sicilies, will be forced to join the HRE

If neither side can achieve 100% Progress before the Age of Discovery starts, whoever is in the Guelphs will either stay out or leave the HRE, and whoever is in the Ghibellines will stay in the HRE.

This is an example of the ending event for the ‘Stalemate Outcome’.