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- **Revenue Growth**: Q3 up 7.1% YoY to $783M, driven by balanced segment growth.
- **Profitability Expansion**: EBITDA margin 27.7% (up 270bps YoY), with $217M EBITDA.
- **Restructuring Impact**: 3.5% workforce reduction targeting $25-30M annual savings, with 2026 organic growth headwind of ~1%.
- **AI Innovation**: Launched AI safety certification testing (UL-3115) and patented AI scoring system.
- **Cash Generation**: $317M free cash flow YTD (+47% YoY), with $26M dividends Q3.

**【CEO Opening Remarks】**
- **Revenue Growth**: Q3 revenue up 7.1% YoY ($783M), driven by balanced contributions across all segments (Industrial +7.3%, Consumer +5.3%, Software & Advisory +6.5%).
- **Profitability**: Adjusted EBITDA of $217M (+18.6% YoY), margin expanded 270bps to 27.7%, highest since IPO.
- **Restructuring Initiative**: Announced 3.5% workforce reduction and exit of 1% of 2025 revenue in nonstrategic services, targeting $25-30M annual savings by Q1 2027.
- **New Product Launch**: Introduced AI safety certification testing (UL-3115) and patented AI scoring system for responsible AI adoption.
- **Capital Allocation**: Generated $317M free cash flow YTD, up 47% YoY, with $26M dividends paid Q3.

**【CFO Financial Commentary】**
- **Segment Performance**: 
  - **Industrial**: Revenue $343M (+8.2% YoY), EBITDA $123M (+16%), margin 35.9%.
  - **Consumer**: Revenue $340M (+5.9% YoY), EBITDA $70M (+12.9%), margin 20.6%.
  - **Software & Advisory**: Revenue $100M (+7.5% YoY), EBITDA $24M (+60%), margin 24%.
- **Restructuring Costs**: $42-47M pretax charges Q4 2025, with 2026 organic growth headwind from exited services.
- **Updated Guidance**: 
  - Organic revenue growth 5.5-6.0% vs. prior 5-6%.
  - EBITDA margin 25% vs. prior 24%.
  - CapEx 6.5-7.0% of revenue (down from 7-8%).

**【Q&A Highlights】**
- **Tariffs Impact**: Customers adapting to tariffs through supply chain diversification, with growth in Vietnam/Thailand/India offsetting declines in Germany/Japan.
- **Restructuring Details**: 3.5% workforce reduction focused on nonstrategic services, with 2026 organic growth rate reduced by ~1% due to exited revenue.
- **Software Segment**: Advisory business benefited from project completions (8.8% organic growth), while recurring software revenue grew 5.8%.
- **AI Testing Lab**: Michigan battery lab utilization strong, with focus on energy storage systems for data centers and EVs.
- **M&A Strategy**: Disciplined approach to inorganic growth, with focus on strategic opportunities in core markets.

UL Solutions Inc. (ULS) Q3 2025 Earnings Call Transcript

Revenue

Sales and Services Revenue

Financing Services Revenue

Other Revenue

Cost of Revenue

Cost of Goods and Services

Cost of Financing Services

Other Cost

Gross Profit

Other Operating Income

Operating Expenses

Selling, General and Administrative Expenses

Selling and Marketing Expenses

General and Administrative Expenses

Research and Development Expenses

Loss on Bad Debts

Loss on Impairment of Other Assets

Loss on Disposal of Assets

Other Operating Expenses

Operating Income

Non-Operating Income (Loss)

Income (Loss) from Affiliates

Income (Loss) from Associates

Income (Loss) from Joint ventures

Gain (Loss) on Other Investment

Gain (Loss) on Change in Fair Value

Gain (Loss) on Foreign Currency Exchange

Other Non-Operating Income (Loss)

Net Interest Expense

Interest Expense

Interest Income

Pretax Income From Continuing Operations

Income Tax Expense

Current Income Tax

Deferred Income Tax

Income Tax Adjustments

Net Income from Continuing Operations

Income from Discontinued Operations

Other Items Before Net Income

Net Income

Net Income Attributable to Minority Interests

Net Income Attributable to Owners of the Company

Preferred Stock Dividends

Other Adjustments

Net Income Attributable to Common Stockholders

Other Comprehensive Income

Total Comprehensive Income

Total Comprehensive Income Attributable to Minority Interests

Total Comprehensive Income Attributable to Owners of the Company

Basic EPS

Basic EPS from Continuing Operations

Basic EPS from Discontinued Operations

Diluted EPS

Diluted EPS from Continuing Operations

Diluted EPS from Discontinued Operations

ULS

ULS fundamentals

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