UL Solutions NYSE: ULS reported second-quarter 2026 revenue growth and record adjusted EBITDA, citing demand tied to electrification, automation, product innovation and AI data-center infrastructure. The company also reaffirmed its full-year outlook as it continues a restructuring program, expands laboratory capacity and pursues portfolio changes.
Revenue rose 5.2% from a year earlier to $816 million, including organic growth of 6.6%. Operating income increased 7.9% to $150 million. Adjusted EBITDA grew 11.2% to a quarterly record of $219 million, while adjusted EBITDA margin expanded 140 basis points to 26.8%. Adjusted diluted earnings per share increased 13.5% to $0.59.
Chief Executive Officer Jenny Scanlon said the results reflected operating leverage from organic growth, improved employee productivity and benefits from the restructuring plan initiated late last year. The company said it achieved 6.6% organic growth despite planned revenue reductions associated with business exits under that program.
Segment Performance
Industrial revenue increased 7.8% to $402 million, including 7.2% organic growth. UL Solutions said ongoing certification services and certification testing both contributed to growth, with materials, energy and automation serving as leading drivers. Industrial adjusted EBITDA rose 7.4% to $130 million, though its adjusted EBITDA margin declined 10 basis points to 32.3%, as higher performance-based employee compensation costs offset the benefit of revenue growth.
Consumer revenue rose 6.5% to $362 million, or 6.2% organically. Growth was driven by certification testing in consumer technology, non-certification testing and other retail services, and ongoing certification in appliances and HVAC. Consumer adjusted EBITDA increased 24.2% to $77 million, and its margin improved 310 basis points to 21.3%.
The company attributed consumer margin expansion to operating leverage, employee productivity, favorable business mix following exits from lower-margin service lines, and restructuring benefits. During the question-and-answer session, Scanlon said consumer demand included activity related to data centers, including power supplies for AI racks, AI-powered chips and servers, as well as broader product certification needs.
Risk and compliance revenue declined 17.5% to $52 million, reflecting the April 1 divestiture of the company’s EHS software business. Excluding that divestiture, organic revenue in the segment grew 4.8%, driven by demand for supply-chain insights in retail. Adjusted EBITDA fell 14.3% to $12 million, while adjusted EBITDA margin improved 90 basis points to 23.1% on a leaner cost structure.
Cash Flow, Investments and Portfolio Actions
For the trailing 12 months ended June 30, UL Solutions generated $678 million of operating cash flow and $436 million of free cash flow, up 19.8% year over year. Free-cash-flow margin improved to 13.9% from 12.3%. For the first six months of 2026, operating cash flow totaled $379 million and free cash flow was $241 million.
Capital expenditures were $138 million during the first half, compared with $93 million a year earlier. The company said it is investing in laboratory capacity and new testing capabilities to meet customer demand. Examples cited included a high-voltage electromagnetic compatibility laboratory opened in Toyota City, Japan, and continuing construction of a large-scale fire laboratory in Northbrook, Illinois.
UL Solutions ended the quarter with $434 million of cash and cash equivalents and $303 million of total debt, down from $494 million at the end of 2025. The reduction reflected $191 million of net repayments on the company’s revolving credit facility, partially funded by proceeds from the EHS software divestiture. The company paid a quarterly dividend of $0.145 per share, totaling $29 million.
The company continues to expect its acquisition of Eurofins Electrical & Electronics business to close in the fourth quarter of 2026. It also expects the sale of its position in DQS Holding GmbH to close in the second half of the year.
Outlook and Demand Trends
UL Solutions reaffirmed its expectation for mid-single-digit organic revenue growth for full-year 2026, including an approximately 1% revenue reduction from restructuring-related business exits. The company expects foreign-exchange effects on second-half revenue to be negligible.
It also maintained its forecast for adjusted EBITDA margin of approximately 27% for the year, reflecting operating leverage, restructuring benefits and cost management. That outlook includes offsets from higher performance-based compensation and acquisition-related expenses associated with the company’s portfolio transactions. The company expects an effective tax rate of about 26%.
Management raised its expected capital-expenditure level to approximately 8.5% of revenue for 2026, citing the timing of laboratory investments and growth opportunities. Chief Financial Officer Ryan Robinson said some major projects extend across year-end periods, while Scanlon said the company was accelerating investments in areas such as appliances, HVAC, electromagnetic compatibility and energy-storage testing.
On demand, Scanlon said the company benefits from exposure to 35 industries and is driven more by innovation than by product volumes. She said changes in supply chains or component costs can lead manufacturers to redesign products, which may require additional testing and certification. The company also cited increasing demand in power, controls, wire and cable, industrial automation and data-center-related infrastructure.
UL Solutions said its advisory business, which has significant exposure to U.S. solar and wind projects, faced some headwinds during the quarter. However, management said overall first-half trends supported its reaffirmed full-year guidance.
Separately, Scanlon noted that UL Solutions received the National Safety Council’s Robert W. Campbell Award, recognizing the company’s workplace safety leadership and safety culture.
About UL Solutions (NYSE:ULS)
UL Solutions NYSE: ULS is a global safety science company that provides testing, inspection, certification, advisory and digital solutions designed to help organizations manage risk, ensure regulatory compliance and drive innovation. With roots dating back to 1894 when it was founded as Underwriters' Electrical Bureau, the company rebranded as UL Solutions following its initial public offering in 2022. Headquartered in Northbrook, Illinois, UL Solutions operates independently to serve a broad range of industries with an emphasis on product safety, performance and sustainability.
The company's core services include standards development, product testing and certification for sectors such as building products, consumer electronics, automotive, life sciences, energy and industrial equipment.
This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to contact@marketbeat.com.
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