$254 million in second-quarter net income is what UL Solutions Inc. (NYSE: ULS) posted for the period ended June 30, a 161.9% year-over-year jump that lifted diluted EPS to $1.21. The surge traces to the gain on the sale of the Employee Health and Safety software business inside the Risk & Compliance Software segment. Back that out, and adjusted net income rose 17.3% to $129 million, with adjusted diluted EPS of $0.59 versus $0.52 a year earlier.
The adjusted read
Revenue grew 5.2% year over year to $816 million, with organic revenue running hotter at 6.6%, led by the Industrial and Consumer segments. Adjusted EBITDA rose 11.2% to $219 million, margin expanding 140 basis points to 26.8%, with the Consumer segment carrying most of the lift. On a reported basis, net income margin jumped 1,860 basis points to 31.1%. The adjusted figure, stripped of the one-time gain, rose a far smaller 160 basis points to 15.8%.
| Metric | Reported | Adjusted |
|---|---|---|
| Net income | $254M, +161.9% YoY | $129M, +17.3% YoY |
| Diluted EPS | $1.21 | $0.59 (from $0.52) |
| Net margin | 31.1% (+1,860 bps) | 15.8% (+160 bps) |
| EBITDA margin | n/a | 26.8% (+140 bps) |
For the six months ended June 30, operating cash flow reached $379 million, up from $301 million a year earlier. Free cash flow came in at $241 million against $208 million in the prior period. Total debt fell to $303 million after $191 million in net repayments on the revolving credit facility, and cash on hand climbed to $434 million from $295 million at year-end 2025. The dividend ran at $0.145 per share, totaling $29 million for the quarter.
Capex and the geopolitical risk flag
Capital expenditures for the first half of 2026 reached $138 million, up from $93 million a year earlier. Management expects capex to run at approximately 8.5% of revenue for the full year, a rate that outpaces the 5.2% top-line growth recorded in Q2. For the full year, UL Solutions guided for adjusted EBITDA margin of approximately 27% and mid-single-digit organic revenue growth on a constant currency basis. The Restructuring Plan, tied to exiting certain business lines, is expected to trim roughly 1% from the year's revenue.
Management's own outlook flagged geopolitical uncertainty as a real risk, warning that customers could modify, delay, or cancel testing and product development plans if conditions worsen, with the company unable to reliably estimate the revenue impact. For a business whose volumes track global product development pipelines, that caveat carries macro weight. Trade disruption tends to compress certification demand well before it surfaces in the reported top line.
Hedge fund ownership fell from 36 funds to 29 in the most recent quarter, even as earnings beat expectations. Short interest stands at 7.70% of the float, and the stock carries a forward P/E of 28.41 as of September 4.