10-Q · May 5, 2026
UL Solutions Inc. delivered robust Q1 2026 results, reporting a revenue of $758 million, a 7.5% increase year-over-year (up $53 million), and an EPS of $0.50, surpassing estimates. The Industrial segment led in growth…
Earnings analysis · 10-Q
ULS earnings analysis
Filed August 4, 2026 · Our reading of the company's report
The latest report
UL Solutions delivered Q2 revenue of $816 million, up 5.2% year over year and 7.7% sequentially, with organic growth of 6.6% led by Industrial and Consumer. Gross margin rose to 51.1% and operating margin improved to…
Read full summary
UL Solutions delivered Q2 revenue of $816 million, up 5.2% year over year and 7.7% sequentially, with organic growth of 6.6% led by Industrial and Consumer. Gross margin rose to 51.1% and operating margin improved to 18.4%, while adjusted EPS increased to $0.59 from $0.52; GAAP EPS of $1.21 was materially boosted by a $191 million divestiture gain. First-half operating cash flow rose to $379 million and free cash flow to $241 million, but reported R&C Software revenue declined 17.5% following the divestiture and the pending €575 million E&E acquisition adds execution risk.
Gross and operating margin
How much of each revenue dollar the business keeps.
One point per quarterly or annual filing. Both margins are shares of that report's revenue.
From revenue to operating profit
Where each $100 of revenue went in this report.
Cost of sales, operating expenses, and what remained. Figures are rounded to whole dollars.
Where revenue came from
The business segments reported by the company.
Shares of the segments disclosed in this filing, largest first.
How we read each report
Our analysis across the last few reports.
Our model's reading of each filing, not the share price or the market's reaction. Annual and quarterly reports each occupy one position.
Reported figures
- Earnings per share
- $1.21
What stood out
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Organic growth lifted Q2 revenue to $816M
Q2 revenue rose $40 million, or 5.2% year over year, to $816 million; this was also $58 million, or 7.7%, above Q1 2026 revenue of $758 million. Organic revenue grew $51 million, or 6.6%, while the divestiture reduced reported revenue by $14 million.
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Gross and operating margins expanded
Gross margin expanded to 51.1% from 49.2% a year ago, as cost of revenue increased only $5 million versus a $40 million revenue increase. Operating income increased $11 million to $150 million, lifting operating margin 50 bps to 18.4%.
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EPS growth includes a large divestiture gain
GAAP diluted EPS increased to $1.21 from $0.45, while adjusted diluted EPS increased to $0.59 from $0.52. The $0.69 GAAP EPS increase includes a $191 million pre-tax gain on the Employee Health and Safety software divestiture, equal to $0.94 per diluted share.
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Industrial and Consumer drove growth
Industrial revenue grew $29 million, or 7.8%, to $402 million, led by $16 million of Ongoing Certification Services growth and $10 million of Certification Testing growth. Consumer revenue grew $22 million, or 6.5%, to $362 million, and its segment operating margin improved 210 bps to 13.0%.
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Cash generation rose despite higher capex
Six-month operating cash flow rose $78 million to $379 million and free cash flow increased $33 million to $241 million. Free-cash-flow margin rose 130 bps to 15.3%, despite capital expenditures increasing $45 million to $138 million, or 8.8% of revenue.
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Liquidity supports investment and acquisitions
Liquidity included $434 million of cash and cash equivalents and $995 million of unused revolver availability at June 30, 2026. The company also had $300 million of 6.500% senior notes due 2028 and repaid more borrowings than it raised, contributing to $308 million of financing cash outflow in the first half.
What to watch
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Software reported revenue and profit declined
Risk & Compliance Software revenue fell $11 million, or 17.5%, to $52 million in Q2 because the Employee Health and Safety software divestiture reduced revenue by $14 million. Segment operating income fell $2 million, from $2 million to breakeven.
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E&E transaction has execution and break-fee exposure
The planned E&E acquisition carries a €575 million enterprise value plus €41 thousand per day from September 1, 2025 through closing. If specified filing deadlines or conditions are not met, ULH could owe a €34.5 million break fee; closing is expected in Q4 2026.
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Customer-demand uncertainty and residual restructuring
Management says geopolitical uncertainty may cause customers to modify, delay, or cancel service purchases. Separately, the company expects approximately $3 million of remaining restructuring charges through completion targeted by the end of Q1 2027.
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No material risk-factor update disclosed
The filing states there were no material changes to risk factors from the 2025 10-K. Existing financing exposure includes $300 million of 6.500% notes due 2028, although management says a hypothetical 100-basis-point change on the revolver would not be material at June 30, 2026.
Management's outlook
The 10-Q contains no explicit numeric FY2026 revenue or EPS guidance. Management states that the Restructuring Plan is expected to be substantially completed by the end of Q1 2027, with approximately $3 million of remaining charges, and expects the E&E acquisition to close in Q4 2026, subject to approvals.
Earlier filings 4
10-K · February 19, 2026
UL Solutions presents a strategy focused on expanding its core TIC business, cross-selling Software & Advisory (S&A) offerings and pursuing targeted M&A while pursuing operational margin expansion. The 10‑K highlights…
10-Q · November 4, 2025
UL Solutions beat revenue and improved margins in Q3: revenue rose to $783 million (up $52M or +7.1% YoY from $731M) and operating income increased to $156 million (19.9% margin). Diluted EPS was $0.49 vs $0.44 a year…
10-Q · May 6, 2025
UL Solutions reported revenue of $705.0M for the quarter ended March 31, 2025, up $35.0M (+5.2%) versus the prior-year period but down $34.0M (-4.6%) versus the prior quarter. Operating income rose to $109M (15.5%…
This is our reading of a public filing, not the filing itself. Analysis can contain errors; check the source document for full context.