UL Solutions (NYSE:ULS) management said the company closed out a “record year” in 2025, with results that exceeded guidance and reflected what CEO Jenny Scanlon described as resilience amid trade policy shifts and geopolitical uncertainty. Executives emphasized balanced demand across segments and regions, continued progress in profitability, and strong cash flow generation while maintaining an investment-grade balance sheet.
Full-year 2025 performance and margin expansion
Scanlon said UL Solutions delivered nearly $3.1 billion in revenue in 2025, up 6.4% from 2024, including 6.2% organic growth. By segment, the industrial business grew 6.9% (7.1% organic), consumer grew 6.5% (6.1% organic), and software and advisory grew 4.0% (3.7% organic). Adjusted EBITDA grew 20.7% for the year, and adjusted EBITDA margin expanded 300 basis points to 25.9%, which management noted exceeded its prior long-term goal of 24% in the company’s second year as a public company.
Fourth-quarter results: growth across industrial and consumer
For the fourth quarter, Robinson reported consolidated revenue of $789 million, up 6.8% year over year, including 5.7% organic growth. Adjusted EBITDA was $217 million, up 28.4%, and adjusted EBITDA margin was 27.5%, up 460 basis points from the prior-year quarter. The company recorded $37 million of pre-tax restructuring charges tied to a previously announced restructuring plan.
Adjusted net income for the quarter rose to $114 million from $102 million a year earlier, while adjusted diluted EPS increased to $0.53 from $0.49. Robinson said profitability gains were partially offset by a higher effective tax rate. For the full year, the effective tax rate was 26.6% in 2025 versus 16.9% in 2024, which Robinson said reflected additional implementation of the OECD’s Pillar 2 provisions and the absence of a prior-year benefit from a significant release of tax reserves.
- Industrial: Q4 revenue of $352 million, up 7.3% (6.1% organic). Robinson said growth occurred across all service lines, led by energy and automation and fire safety testing. Segment adjusted EBITDA rose 21.9% to $128 million, and margin improved 440 basis points to 36.4%.
- Consumer: Q4 revenue of $335 million, up 8.4% (7.1% organic). Management pointed to strength across service categories, led by non-certification testing and other services, and noted demand in consumer technology including EMC testing and HVAC. Segment adjusted EBITDA increased 46.7% to $66 million, and margin rose 510 basis points to 19.7%.
- Software and advisory: Q4 revenue of $102 million, essentially flat year over year. Robinson said strong software demand, including retail product compliance, was offset by lower advisory activity. Segment adjusted EBITDA was $23 million, and margin improved 390 basis points to 22.5%, primarily due to lower services and materials costs.
Investments, standards work, and portfolio changes
Scanlon highlighted a range of testing infrastructure investments completed or announced in 2025, including new facilities for battery testing in Aachen, Germany; HVAC and heat pump testing in Carugate, Italy; and electric motor efficiency testing in Ise, Japan. UL Solutions also expanded laboratories in Dongguan and Ningbo, China for IoT, wireless, and retail product testing. The company broke ground on a Global Fire Science Center of Excellence in Northbrook, Illinois, and on two automotive EMC testing facilities: Toyota City, Japan (expected to open in the second half of 2026) and Neu-Isenburg, Germany (projected to be operational by mid-2027).
Management also discussed initiatives tied to evolving safety standards and sustainability certifications. In the fourth quarter, UL Solutions announced new certification services for battery-powered vehicles and industrial equipment supporting UL 2850 and UL 2701 standards, addressing battery management, thermal runaway risks, and functional safety. The company said it extended its ECOLOGO certification program to industrial products and issued Schneider Electric the first ECOLOGO certification for an industrial product, certifying its PowerPacT circuit breakers portfolio.
On the software side, Scanlon said the company expanded its ULTRUS platform with new AI-powered releases intended to support compliance and sustainability goals.
As part of an organizational update, Scanlon said the company realigned its software and advisory segment at the beginning of 2026 to create a focused software segment renamed Risk and Compliance Software. Effective in Q1 2026, advisory services—about 5% of consolidated 2025 revenue—will move into the industrial segment. Scanlon said this was intended to better pair technical advisory with standards-driven testing, inspection, and certification (TIC) services.
Capital allocation, divestiture, and 2026 outlook
UL Solutions generated $600 million in operating cash flow in 2025, up from $524 million in 2024. Capital expenditures were $197 million (6.5% of revenue). Free cash flow totaled $403 million, up from $287 million in 2024, increasing as a percentage of revenue from 10% to 13.2%. The company ended 2025 with $295 million of cash and cash equivalents. Management also noted it repaid $253 million of borrowings and paid $104 million in dividends during 2025, and Scanlon said the regular quarterly dividend will increase by 11.5%.
The company announced the divestiture of its employee health and safety (EHS) software business, which accounted for approximately $56 million of 2025 revenue. Robinson said the transaction is expected to close in the second quarter of 2026 and carries a sale price of about $210 million, subject to customary post-closing adjustments. He said proceeds will initially be used for general corporate purposes, including debt repayment, while maintaining flexibility for reinvestment, acquisitions, and shareholder returns.
For 2026, Robinson guided to mid-single-digit consolidated organic revenue growth and said industrial is expected to grow faster than consumer. He also said current forward FX rates imply an additional ~50 basis points tailwind to revenue growth year over year, with most of the benefit expected in the first half. The company expects adjusted EBITDA margin of 26.5% to 27% in 2026, assuming current forward FX rates. The outlook also reflects restructuring actions that include exiting non-strategic service lines totaling about 1% of 2025 revenue, which management said will reduce organic revenue growth and is included in the guidance.
Robinson said capital expenditures are expected to be about 7% to 8% of revenue in 2026 as the company continues investing in new labs to meet demand, and the effective tax rate is expected to be about 26%. He also noted typical seasonality, with Q1 usually the lowest revenue quarter due to the Lunar New Year impact in Asia and fewer workdays, and said the company expects more of its adjusted EBITDA margin improvement to occur in the second half of 2026.
During Q&A, executives discussed drivers behind margins and growth, pointing to continuous improvement efforts, pricing and volume leverage, higher lab and employee utilization, and exposure to megatrends such as the energy transition, sustainability, and digitalization. Scanlon also described data center-related demand as spanning multiple categories, including power and automation, wire and cable, built environment and fire suppression, and cooling systems, and said customers are seeking help addressing emerging complexities such as thermal dynamics, DC current and higher voltages, and new cooling approaches.
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.
