UL Solutions (ULS) Q1 2026 earnings summary

Executive summary

• Revenue grew 7.5% year-over-year to $758 million for Q1 2026, with 5.7% organic growth, led by strong performance across all segments and favorable FX impacts.

• Adjusted EBITDA increased 22.4% to $197 million, with margin expanding 320 basis points to 26.0%, reflecting disciplined expense management and operating leverage.

• Net income rose 36.6% to $97 million, with net income margin improving to 12.8% from 10.1% in Q1 2025.

• Adjusted Diluted EPS rose 35.1% to $0.50, supported by revenue growth and margin expansion.

• Major portfolio actions included the divestiture of the Employee Health and Safety software business and the announced acquisition of Eurofins Electrical and Electronics (E&E) business.

Financial highlights

• Q1 2026 consolidated revenue: $758 million, up 7.5% year-over-year; organic growth 5.7%.

• Adjusted EBITDA: $197 million, up 22.4% year-over-year; margin at 26.0%, up 320 basis points.

• Adjusted Net Income was $107 million (14.1% margin), up from $80 million (11.3%).

• Diluted EPS was $0.45, up from $0.33; Adjusted Diluted EPS was $0.50, up from $0.37.

• Free Cash Flow for the quarter was $150 million (19.8% margin), up from $103 million (14.6%).

Outlook and guidance

• Full-year 2026 outlook: mid-single-digit constant currency organic revenue growth, including ~1% reduction from planned business exits.

• Adjusted EBITDA margin expected to improve to approximately 27.0%.

• Effective tax rate projected at ~26%; capital expenditures between 7% and 8% of revenue.

• Remaining restructuring expenses expected to be ~$3 million, with plan substantially completed by Q1 2027.

• Ongoing portfolio optimization and acquisition activity planned.