UL Solutions (ULS) Q1 2025 earnings summary

Executive summary

• Q1 2025 revenue grew 5.2% year-over-year to $705 million, with 7.6% organic growth and strong execution across all segments, especially Industrial and Consumer.

• Adjusted EBITDA increased 22.9% to $161 million, with margin expanding 320 basis points to 22.8%.

• Adjusted Net Income rose 31.1% to $80 million, with margin up to 11.3%.

• Free Cash Flow for Q1 was $103 million, with last twelve months reaching $306 million.

• Completed two Industrial acquisitions, divested payments testing business for a $24 million pre-tax gain, and increased quarterly dividend to $0.13 per share.

Financial highlights

• Q1 2025 revenue: $705 million, up from $670 million in Q1 2024; organic growth 7.6%.

• Adjusted EBITDA: $161 million (22.8% margin), up from $131 million (19.6% margin).

• Adjusted Net Income: $80 million (11.3% margin), up from $61 million (9.1% margin).

• Adjusted Diluted EPS: $0.37, up from $0.28 in Q1 2024.

• Free Cash Flow: $103 million, up from $84 million; Free Cash Flow margin improved to 10.5%.

Outlook and guidance

• 2025 outlook reaffirmed: mid single-digit constant currency organic revenue growth expected.

• Adjusted EBITDA margin targeted to improve to approximately 24% for the full year.

• Capital expenditures projected at 7–8% of revenue; effective tax rate estimated at ~26%.

• Sufficient liquidity anticipated for ongoing operations, investments, and dividends.

• Ongoing focus on acquisitions and portfolio refinements.