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What changed in UL Solutions Inc.'s 10-K — 2024 vs 2025

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Paragraph-level year-over-year comparison of UL Solutions Inc.'s 2024 and 2025 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2025 report.

+705 added−779 removedSource: 10-K (2026-02-19) vs 10-K (2025-02-20)

Top changes in UL Solutions Inc.'s 2025 10-K

705 paragraphs added · 779 removed · 611 edited across 8 sections

Item 1. Business

Business — how the company describes what it does

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Biggest changeAs of December 31, 2024, our highly experienced employee base had an average tenure with UL Solutions of nine years with us or our affiliates, and our technical talent had an average tenure of ten years, which instills trust within our customers and provides superior outcomes in safety, security and sustainability. 8 None of our U.S.-based employees are covered by collective bargaining agreements, although approximately 10% of our employees are represented by foreign trade unions and work councils in the Americas, the APAC region, Europe, the Middle East and Africa, which could subject us to arrangements very similar to collective bargaining agreements.
Biggest changeNone of our U.S.-based employees are covered by collective bargaining agreements, although approximately 10% of our employees are represented by foreign trade unions and work councils in the Americas, the APAC region, Europe, the Middle East and Africa, which could subject us to arrangements very similar to collective bargaining agreements.
This duration has been subsequently extended twice and currently expires in January 2033 pursuant to the amended and restated agreement the Company entered into with CCIC on October 28, 2022. Refer to Item 8, “Notes to the Consolidated Financial Statements”, Note 8, “Investments in Equity Securities” for further details.
This duration has been subsequently extended twice and currently expires in January 2033 pursuant to the amended and restated agreement the Company entered into with CCIC on October 28, 2022. Refer to Item 8, “Notes to the Consolidated Financial Statements”, Note 7, “Investments in Equity Securities” for further details.
Compliance with laws regulating contamination and the discharge of materials into the environmental, or otherwise relating to the protection of the environment or human health and safety, have not had a material effect on our capital expenditures, earnings, or competitive position, and are not currently material to our total operating costs or cash flows.
Compliance with laws regulating contamination and the discharge of materials into the environment, or otherwise relating to the protection of the environment or human health and safety, have not had a material effect on our capital expenditures, earnings, or competitive position, and are not currently material to our total operating costs or cash flows.
Consumer Our Consumer segment provides a variety of global product market acceptance and risk mitigation services for customers in the consumer products end market, including consumer electronics, medical devices, information technologies, appliances, HVAC, lighting and retail (softlines and hardlines) and emerging consumer applications, including new mobility, smart products and 5G.
Consumer Our Consumer segment provides a variety of global product market acceptance and risk mitigation services for customers in the consumer products end market, including consumer electronics, medical devices, information technologies, appliances, HVAC, lighting and retail (softlines and hardlines) and emerging consumer applications, including new mobility, smart 6 products and 5G.
The primary services offered by this segment include safety certification testing, ongoing certification, global market access, testing for connectivity, performance and quality and critical systems advisory and training. 6 Software and Advisory Our S&A segment provides complementary software and advisory solutions that extend the value proposition of TIC services we offer.
The primary services offered by this segment include safety certification testing, ongoing certification, global market access, testing for connectivity, performance and quality and critical systems advisory and training. Software and Advisory Our S&A segment provides complementary software and advisory solutions that extend the value proposition of TIC services we offer.
Our SaaS and licensed software solutions provide data-driven product stewardship, chemicals management, supply chain insights, environmental, social and governance (“ESG”) data and reporting, environmental, health and safety (“EHS”) training, management and compliance, and additional regulatory driven software solutions. Our Team and Talent Management We employ leading talent, with technical expertise throughout the organization.
Our SaaS and licensed software solutions provide data-driven product stewardship, chemicals management, supply chain insights, environmental, social and governance (“ESG”) data and reporting, environmental, health and safety (“EHS”) training, management and compliance, and additional regulatory driven software solutions. 8 Our Team and Talent Management We employ leading talent, with technical expertise throughout the organization.
We do this by, among other things, using a global trademark watch service; recording our marks with customs agencies around the world; engaging in opposition proceedings in various trademark offices; sending cease-and-desist letters to counterfeiters and other infringers and pursuing legal action against them where appropriate; and partnering with customers, code authorities and law enforcement to provide them with tools and information necessary to distinguish between authentic and counterfeit UL Marks so that we may work together in diverting any authorized UL marked product out of the stream of commerce.
We do this by, among other things, using a global trademark watch service; recording our marks with customs agencies around the world; engaging in opposition proceedings in various trademark offices; sending cease-and-desist letters to counterfeiters and other infringers and pursuing legal action against them where appropriate; and partnering with customers, code authorities and law enforcement to provide them with tools and information necessary to distinguish between authentic and counterfeit UL Marks so that we may work together in diverting any unauthorized UL marked product out of the stream of commerce.
However, environmental liabilities can change substantially, including due to changes in laws and regulations, and any future violations of applicable laws or regulations could adversely affect our financial condition and results of operations.
However, environmental liabilities can change substantially, including due to changes in laws and regulations, and any future violations of applicable laws or regulations could adversely affect our business, financial condition and results of operations.
Our distinguished heritage and our long history of operating at the forefront of safety science enables us to achieve and maintain more than 650 technical accreditations and 76 commercial software solutions, and to remain active in over 1,300 standards panels and technical committees globally, which underpins the expertise we offer to our customers.
Our distinguished heritage and our long history of operating at the forefront of safety science enables us to achieve and maintain more than 650 technical accreditations and 76 commercial software solutions, and to remain active in over 1,200 standards panels and technical committees globally, which underpins the expertise we offer to our customers.
S&A offerings allow us to serve a broader addressable market and represent a significant growth opportunity and recurring revenues with existing and new customers. In 2024, approximately 65% of our global and strategic accounts cross-purchased software and advisory solutions to complement their core TIC needs, driving business growth with attractive recurring revenues.
S&A offerings allow us to serve a broader addressable market and represent a significant growth opportunity and recurring revenues with existing and new customers. In 2025, approximately 65% of our global and strategic accounts cross-purchased software and advisory solutions to complement their core TIC needs, driving business growth with attractive recurring revenues.
Furthermore, we offer over 400 independent third-party conformity assessment services around the world and are capable of testing and certifying against over 4,000 global standards, which affords us vast insight into the safety of products across a wide range of end markets and geographies.
Furthermore, we offer over 350 independent third-party conformity assessment services around the world and are capable of testing and certifying against over 4,000 global standards, which affords us vast insight into the safety of products across a wide range of end markets and geographies.
As the largest TIC services provider headquartered in North America (by revenue) with a global network of laboratories, we provided a comprehensive set of product safety, security and sustainability solutions to more than 80,000 customers across over 110 countries in 2024.
As the largest TIC services provider headquartered in North America (by revenue) with a global network of laboratories, we provided a comprehensive set of product safety, security and sustainability solutions to more than 80,000 customers across over 110 countries in 2025.
Our global governance structure includes the active management of successful renewal of such credentials, the expansion or consolidation of these credentials, where warranted, and the pursuit of new credentials to preserve and to enable our ability to serve customers continuously. Some of our credentials are granted by government agencies in North America, Asia (including mainland China) and Europe.
Our global governance structure includes the active management of successful renewal of such credentials, the expansion or consolidation of these credentials, where warranted, and the pursuit of new credentials to preserve and to enable our ability to serve customers continuously. Some of our credentials are granted by government agencies in North America, Asia and Europe.
(“UL Standards & Engagement”) and UL Solutions. UL Research Institutes is the sole member of UL Standards & Engagement, which controls the majority of the voting power of our common stock.
(“UL Research Institutes”), UL Standards & Engagement and UL Solutions. UL Research Institutes is the sole member of UL Standards & Engagement, which controls the majority of the voting power of our common stock.
Our mission drives our actions, inspires our employees and is the key to our success. We strive to be our customers’ most trusted science-based safety, security and sustainability partner. Our history dates back to our founding in 1894 as part of the nonprofit Underwriters Electrical Bureau, a predecessor to Underwriters Laboratories Inc. (“UL Research Institutes”), ULSE Inc.
Our mission drives our actions, inspires our employees and is the key to our success. We strive to be our customers’ most trusted science-based safety, security and sustainability partner. Our history dates back to our founding in 1894 as part of the nonprofit Underwriters Electrical Bureau, a predecessor to Underwriters Laboratories Inc.
We have a global governance structure in place to facilitate compliance with these requirements. Our current key credentials include those granted by key regulators and authorities in North America, Asia (including Greater China) and Europe.
We have a global governance structure in place to facilitate compliance with these requirements. Our current key credentials include those granted by key regulators and authorities in North America, Asia and Europe.
There were no material capital expenditures for environmental control facilities in 2022, 2023 or 2024, and there are no material investments currently planned for 2025; however, we may make material expenditures related to such facilities in the future. 10 Intellectual Property Our intellectual property is an important part of our business.
There were no material capital expenditures for environmental control facilities in 2023, 2024 or 2025, and there are no material investments currently planned for 2026; however, we may make material expenditures related to environmental control facilities generally in the future. 10 Intellectual Property Our intellectual property is an important part of our business.
In Europe, approximately 18% of our workforce are represented by work council committees. We have not experienced any work stoppages or strikes that have had a material adverse impact on our operations. We consider our relationships with our employees to be collaborative.
In Europe, approximately 20% of our workforce are represented by work council committees. We have not experienced any work stoppages or strikes that have had a material adverse effect on our operations. We consider our relationships with our employees to be collaborative.
Our Service Offerings We generate our revenue through four major service categories (percent of revenue for 2024): Certification Testing (approximately 27% of revenue). We evaluate products, components and systems according to global or regional regulatory requirements and other design and performance specifications.
Our Service Offerings We generate our revenue through four major service categories (percent of revenue for 2025): Certification Testing (approximately 28% of revenue). We evaluate products, components and systems according to global or regional regulatory requirements and other design and performance specifications.
We are the owner of the iconic UL Mark that appears on billions of products around the world. We offer our customers global market access services that help them ensure the safety and quality of their products while also supporting their efforts to manage the broader risks they face throughout their product lifecycle processes.
We are the owner of the iconic UL-in-a-circle certification mark (the “UL Mark”) that appears on billions of products around the world. We offer our customers global market access services that help them ensure the safety and quality of their products while also supporting their efforts to manage the broader risks they face throughout their product lifecycle processes.
As of December 31, 2024, we had a total of 14,813 full-time employees and 281 part-time employees. Our technical team of approximately 9,800 scientists, engineers and other specialized technical and regulatory experts has been purpose-built over many years and is core to our competitive differentiation.
As of December 31, 2025, we had a total of 14,587 full-time employees and 264 part-time employees. Our technical team of approximately 9,900 scientists, engineers and other specialized technical and regulatory experts has been purpose-built over many years and is core to our competitive differentiation.
UL-CCIC is governed by an agreement first entered into on June 26, 2002, and has been amended from time to time. UL-CCIC was established with an initial duration of 10 years, starting from the date that it obtained its business license.
The remaining 30% equity interest is owned by CCIC, a Chinese state-owned enterprise. UL-CCIC is governed by an agreement first entered into on June 26, 2002, and has been amended from time to time. UL-CCIC was established with an initial duration of 10 years, starting from the date that it obtained its business license.
We believe many of our service marks, certification marks, trademarks and trade names are important to our success, and as of December 31, 2024, our trademark portfolio included approximately 116 registered U.S. trademarks and approximately 14 pending U.S. trademark applications, and approximately 2,000 registered trademarks and 150 pending trademark applications in other countries.
We believe many of our service marks, certification marks, trademarks and trade names are important to our success, and as of December 31, 2025, our trademark portfolio included approximately 120 registered U.S. trademarks and approximately 8 pending U.S. trademark applications, and approximately 2,000 registered trademarks and 100 pending trademark applications in other countries.
As of December 31, 2024, we had approximately 21 issued U.S. patents and approximately 23 U.S. patent applications pending, all in various stages of examination.
As of December 31, 2025, we had approximately 27 issued U.S. patents and approximately 24 U.S. patent applications pending, all in various stages of examination.
The outsourced product TIC market, where we currently focus, is served by our Industrial and Consumer segments, which provide comprehensive testing, inspection and certification services to customers across a broad array of end markets.
The outsourced product TIC market, where we currently focus, is served by our Industrial and Consumer segments, which provide comprehensive testing, inspection and certification services to customers across a broad array of end markets. Our Software and Advisory (“S&A”) segment, which also serves the outsourced product TIC market, is a global provider of software, data and advisory solutions.
As part of our broader employee development process, our proprietary UL University (“ULU”) program provides education and training to all of our employees through a comprehensive portfolio of instructor-led, online and self-directed learning options. Information Technology Our information technology capabilities provide a competitive advantage by allowing us to focus on enhancing the customer experience and internal operational efficiencies.
As part of our broader employee development process, our proprietary UL University program provides education and training to all of our employees through a comprehensive portfolio of instructor-led, online and self-directed learning options. Information Technology Our scalable, efficient and high-quality information technology capabilities enable us to enhance both the customer experience and our internal operational efficiencies.
Our customers rely on our deep expertise in innovative and cost-effective solutions as the safety and regulatory environment changes and requires them to seek additional third-party TIC support. As an example, security, affordability and sustainability are driving rapid innovation of the energy industry.
Our customers rely on our deep expertise in innovative and cost-effective solutions as the safety and regulatory environment changes and requires them to seek additional third-party TIC support.
Our Software and Advisory (“S&A”) segment is a global provider of software, data and advisory solutions, enabling our customers to manage complex regulatory requirements, deliver supply chain transparency and operationalize sustainability. We generate revenue in these segments and the following service categories: Certification Testing; Ongoing Certification Services; Non-certification Testing and Other Services; and Software.
These offerings enable our customers to manage complex regulatory requirements, deliver supply chain transparency and operationalize sustainability. We generate revenue in these segments and the following service categories: Certification Testing; Ongoing Certification Services; Non-certification Testing and Other Services; and Software.
Today’s energy landscape is complex, connected and bidirectional, requiring many new components and systems, all of which must be evaluated for compatibility, stability and safety. Expand S&A offerings.
Today’s energy ecosystem is increasingly complex, bidirectional and interconnected, requiring new innovations, including wire and cable, components, products and systems, all of which must be evaluated for compatibility, stability and safety. Expand S&A offerings.
One key expansion area is supply chain software that enables many of the world’s largest retailers and manufacturers, among others, to effectively evaluate and ensure regulatory compliance, chemical safety and sustainability across their products. On January 31, 2024, we launched ULTRUS, our new brand that unites our flagship software that helps customers meet regulatory, supply chain and sustainability challenges.
One key expansion area is supply chain software that enables many of the world’s largest retailers and manufacturers, among others, to effectively evaluate and ensure regulatory compliance, chemical safety and sustainability across their products.
Talent, Engagement and Development Our talent management strategy is to attract, grow and retain a global and diverse workforce through performance reward and development programs. Our talent development programs include on-the-job training, professional development, internal and external partner leadership programs, organizational development and a self-service curriculum.
Talent, Engagement and Development Our talent management strategy is to attract, grow and retain a global and inclusive workforce where individuals can achieve their highest potential, regardless of background, through rewarding high performance and offering development programs. Our talent development programs include on-the-job training, professional development, internal and external partner leadership programs, organizational development and a self-service curriculum.
Our technical expertise and safety science thought leadership drives our accreditation management capabilities, which provide a high degree of business continuity and reliability to our customers. 9 Government Regulation and Compliance Our business is subject to a number of laws and regulations, both within and outside the U.S., in areas such as data privacy, anti-bribery and corruption, international trade, taxation, environmental protection and others.
Government Regulation and Compliance Our business is subject to a number of laws and regulations, both within and outside the U.S., in areas such as data privacy, anti-bribery and corruption, international trade, taxation, environmental protection and others.
Our Segments Industrial Our Industrial segment provides TIC services to help ensure that our customers’ industrial products meet or exceed international standards for product safety, performance, cybersecurity and sustainability.
Refer to Part II, Item 8, “Notes to the Consolidated Financial Statements”, Note 22, “Subsequent Events” for further details. Industrial Our Industrial segment provides TIC services to help ensure that our customers’ industrial products meet or exceed international standards for product safety, performance and sustainability.
Lastly, we offer advisory and technical services to support our customers in managing their safety, compliance, regulatory risk and sustainability programs. Software (approximately 10% of revenue). We provide SaaS and license-based software solutions, including implementation and training services related to software, to enable our customers to manage complex regulatory requirements, deliver supply chain transparency and operationalize sustainability.
We provide software as a service (“SaaS”) and license-based software solutions, including implementation and training services related to software, to enable our customers to manage complex regulatory requirements, deliver supply chain transparency and operationalize sustainability.
Our strong balance sheet and free cash flow profile will continue to provide significant flexibility to pursue highly accretive bolt-on and transformational acquisitions. 7 Employing Operational Strategies to Expand Margins. As we continue to increase our scale, we prioritize excellence across our operations to help drive profit margin improvement.
Employing Operational Strategies to Expand Margins As we continue to increase our scale, we prioritize excellence across our operations to help drive profit margin improvement.
In addition, our cash flow from operations is typically lowest in the first quarter due to payment of the prior year’s annual performance-based variable incentive compensation.
In addition, our cash flow from operations is typically lowest in the first quarter due to payment of the prior year’s annual performance-based variable incentive compensation. UL-CCIC Agreement We, via our wholly owned subsidiary UL LLC, own 70% of the issued and outstanding equity interests of UL-CCIC, an entity formed under the laws of the People’s Republic of China (“P.R.C”).
We believe the primary competitive advantages of our services are our capabilities, global reach, large installed base of laboratories and equipment, reputation and operational track record. Additionally, we believe we have a competitive advantage over our peers through the integrity of our work as an independent third party recognized by governments and international bodies.
In our S&A segment, we also compete against a diverse group of point solution providers. We believe the primary competitive differentiators of our services are our capabilities, global reach, large installed base of laboratories and equipment, reputation and operational track record.
Deploying Capital for Acquisition-Related Growth. The global TIC industry remains highly fragmented with many sub-scale competitors in operation. We use acquisitions to grow our core and expand into attractive adjacencies and end markets that add capabilities to better serve our customers.
On January 31, 2024, we launched ULTRUS TM , our brand that unites our flagship software that helps customers meet regulatory, supply chain and sustainability challenges. 7 Deploying Capital for Acquisition-Related Growth The global TIC industry remains highly fragmented with many sub-scale competitors in operation.
Our information technology is underpinned by our centrally managed IT, security and digital teams, collectively guided by a comprehensive strategy and multi-year roadmap that reflect opportunities to improve the customer experience, employee productivity and cybersecurity. Our employees benefit from common global processes and decision support capabilities that are supported by leading commercial-off-the-shelf technologies, such as Oracle, Microsoft and Salesforce.
These capabilities are supported by centrally managed IT and security teams working under a comprehensive strategy and multi‑year roadmap designed to improve customer satisfaction, employee productivity, and cybersecurity resiliency. Our customers value the trusted information we generate and the data we provide.
Competition We operate in a global and highly fragmented industry that is diverse across geographies, services and markets. Although the global TIC market has a number of large, global market participants, the broader market landscape remains highly fragmented and the majority of the markets we serve remain competitive on a global and local level.
The global TIC industry has a number of large, global market participants, and the broader landscape also remains highly fragmented and intensely competitive. We are subject to competition from a broad range of players including large and global public and private firms, as well as a broad number of smaller companies and new entrants.
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Our customers value the trusted information we generate and the data we provide, which are supported by our strategy to deliver a common user experience and base platform through proprietary, customer-facing digital solutions. Our unified, consistent processes provide a fully connected customer experience across our businesses, improving customer satisfaction and ultimately improving our performance.
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Our Segments Effective beginning in the first quarter of 2026, the Company reorganized its segments to be consistent with how the Chief Executive Officer will evaluate business performance and allocate resources. The amounts and discussions included within this Form 10-K reflect the Company’s segment structure that existed through the end of 2025.
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These customer-facing digital solutions complement our TIC business by providing our customers with digital tools to help augment and manage testing, certification, inspection, in-market data and compliance, while supporting customers in improving productivity, quality and sustainability.
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For example, the rapid increase for energy demand globally being driven by a number of factors, including the expansion of AI data centers, requires new safety and security measures, backed by research, standards and regulations.
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Examples of current initiatives include: • We are currently digitizing information gathering and analysis to provide the most cohesive and effective TIC software solutions to help customers achieve efficiencies throughout their product lifecycle. • “myUL,” a one-stop self-service portal used by customers to securely access their UL Solutions project files, key product information and inspection reports real-time, which allows them to make better informed and timely decisions. • UL Product iQ portal, which is used to access detailed certification information of UL Solutions-certified products.
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We use acquisitions to grow our core and expand into attractive adjacencies and end markets that add capabilities to better serve our customers. Our strong balance sheet and free cash flow profile will continue to provide significant flexibility to pursue highly accretive bolt-on and transformational acquisitions.
Removed
We are subject to competition from large and global public firms, such as Intertek, SGS, Bureau Veritas and Eurofins. We also compete with large private players, including Element, TÜV Rheinland, TÜV SÜD, DEKRA and DNV. In our S&A segment, we tend to compete against a diverse group of point solution providers.
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Lastly, we offer advisory and technical services to support our customers in managing their safety, compliance, regulatory risk and sustainability programs. Software (approximately 9% of revenue).
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UL-CCIC Agreement We, via our wholly owned subsidiary UL LLC, own 70% of the issued and outstanding equity interests of UL-CCIC Company Limited (“UL-CCIC”), an entity formed under the laws of the People’s Republic of China (“P.R.C”). The remaining 30% equity interest is owned by China Certification & Inspection (Group) Co., Ltd. (“CCIC”), a Chinese state-owned enterprise.
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As of December 31, 2025, our highly experienced employee base had an average tenure with UL Solutions of nine years with us or our affiliates, and our technical talent had an average tenure of 11 years, which instills trust within our customers and provides superior outcomes in safety, security and sustainability.
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Our ULTRUS TM software portfolio is built on a shared platform that delivers a common user experience and integrated applications. Across multiple ULTRUS TM software solutions, we incorporate artificial intelligence capabilities that help customers accelerate product launches, improve regulatory compliance, and strengthen their sustainability initiatives.
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Our employees benefit from globally aligned processes and decision-support capabilities enabled by leading commercial off-the-shelf technologies, including Oracle, Microsoft and Salesforce. These platforms embed artificial intelligence that enhances the speed and quality of decision-making across our organization.
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Technology initiatives currently underway include efforts to: • Expand software-enabled compliance tools; • Strengthen customer access to certification and compliance data; and • Modernize service delivery systems through automation and intelligent workflows. Competition We operate in a global and highly fragmented industry that is diverse across geographies, services and markets.
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Additionally, we believe we have a competitive advantage over our peers through the integrity of our work, which has led to third party recognition by governments and international bodies. Our technical expertise and safety science thought 9 leadership drives our accreditation management capabilities, which provide a high degree of business continuity and reliability to our customers.

Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeThe following legal and regulatory developments also could have a material adverse effect on our business, financial position, results of operations or cash flows: • amendment, enactment or interpretation of laws and regulations which restrict the access and use of personal information and reduce the supply of data available to customers; • changes in cultural and consumer attitudes to favor further restrictions on information collection and sharing, which may lead to regulations that prevent full utilization of our services or solutions; • failure of our services or solutions to comply with current and future laws and regulations; and 45 • failure of our services or solutions to adapt to changes in the regulatory environment in an efficient, cost-effective manner.
Biggest changeChanges in cultural and consumer attitudes to favor further restrictions on information collection and sharing, which may lead to regulations that prevent full utilization of our services or solutions, could have a material adverse effect on our business, financial condition and results of operations.
If any of our customers, competitors or new market entrants develop algorithms or other AI tools capable of replicating or better competing against our services, our services and solutions could, over time, become obsolete or unnecessary, or the demand for our services could be significantly reduced, particularly if any such AI alternative proved to be more accurate, more efficient and/or more cost-effective than our employees.
If any of our customers, competitors or new market entrants develop algorithms or other AI tools capable of replicating or better competing against our services, our services and solutions could, over time, become obsolete or unnecessary, or the demand for our services could be significantly reduced, particularly if any such AI alternative proved to be more accurate, more efficient or more cost-effective than our employees.
Part of our growth strategy is to pursue strategic transactions, including acquisitions, and we may not be able to find suitable acquisition targets or achieve our desired acquisition objectives. As part of our strategy, we have in the past and plan in the future to seek to grow our business through acquisitions, and any such acquisition may be significant.
Part of our growth strategy is to pursue strategic transactions, including acquisitions, and we may not be able to find suitable acquisition targets or achieve our desired acquisition objectives. As part of our strategy, we have in the past and plan in the future to seek to grow our business through acquisitions, and any such acquisitions may be significant.
As a result, incorrect or incomplete assessments of the performance of customers in those industries could give rise to negligence or other legal claims or cause damage to our reputation and, as a result, we could lose existing or future agreements with those customers.
Incorrect or incomplete assessments of the performance of customers in those industries could give rise to negligence or other legal claims or cause damage to our reputation and, as a result, we could lose existing or future agreements with those customers.
If we fail to develop new capabilities, our ability to procure new agreements could be negatively impacted, which would negatively impact our business, results of operations and financial condition.
If we fail to develop new capabilities, our ability to procure new agreements could be negatively impacted, which would negatively impact our business, financial condition and results of operations.
Our existing general liability and cybersecurity insurance may not cover any, or may cover only a portion of any, potential claims or expenses related to such incidents that affect us or may not be adequate to indemnify us for all or any portion of liabilities that may be imposed.
Our existing general liability and cybersecurity insurance may not cover, or may cover only a portion of, any potential claims or expenses related to such incidents that affect us or may not be adequate to indemnify us for all or any portion of liabilities that may be imposed.
In addition, there are continuous improvements in computer hardware, network operating systems, programming tools, programming languages, operating systems, data matching, data filtering and other database technologies and the use of the internet as well as emergence of new technologies.
In addition, there are continuous improvements in computer hardware, network operating systems, programming tools, programming languages, operating systems, data matching, data filtering and other database technologies and the use of the internet as well as the emergence of new technologies.
If any new necessary permits, licenses, accreditations, approvals or authorizations are required, or if any review or other procedure is required, we or may not be able to obtain such permits, licenses, accreditations, approvals or authorizations or complete such review or other relevant procedure in a timely manner or at all.
If any new necessary permits, licenses, accreditations, approvals or authorizations are required, or if any review or other procedure is required, we may or may not be able to obtain such permits, licenses, accreditations, approvals or authorizations or complete such review or other relevant procedure in a timely manner or at all.
The accreditations, approvals, permits, delegations of authority, official recognition and other authorizations we must in some instances obtain are issued by public authorities or professional organizations, often following long and often complex review procedures. Most authorizations are granted for limited periods of time and are subject to periodic renewal by the authority concerned.
The accreditations, approvals, permits, delegations of authority, official recognition and other authorizations we must in some instances obtain are issued by public authorities or professional organizations, often following long and complex review procedures. Most authorizations are granted for limited periods of time and are subject to periodic renewal by the authority concerned.
Similarly, although we monitor developments in the regulatory landscapes in the jurisdictions in which we operate, if any regulatory agency were to decide that we have not met their required standards or obtained or maintained their required permissions or approvals, such regulatory agency could impose fines and penalties on, limit or revoke our operating privileges in that jurisdiction or take other actions that could have a material adverse effect our business, financial condition, results of operations and reputation.
Similarly, although we monitor developments in the regulatory landscapes in the jurisdictions in which we operate, if any regulatory agency were to decide that we have not met their required standards or obtained or maintained their required permissions or approvals, such regulatory agency could impose fines and penalties on, limit or revoke our operating privileges in that jurisdiction or take other actions that could have a material adverse effect our reputation, business, financial condition and results of operations.
If a violation of relevant laws or regulations is found, the relevant regulatory authorities would have broad discretion to take action in dealing with such violations by, among other things: • revoking our, including UL-CCIC’s, business or operating licenses; • shutting down our, including UL-CCIC’s, servers, blocking our, including UL-CCIC’s, website or discontinuing or placing restrictions or onerous conditions on our operation through any transactions involving UL-CCIC or any of our other Chinese subsidiaries; • imposing fines, confiscating the income of UL-CCIC or any of our other Chinese subsidiaries, blocking the offshore remittance of the profits and earnings of UL-CCIC or of any of our other Chinese subsidiaries or imposing other requirements with which we, including UL-CCIC, may not be able to comply; • requiring us to restructure UL-CCIC’s ownership or governance structure or operations, which in turn could materially affect our ability to consolidate, derive economic interests from or exert control over UL-CCIC or our other Chinese subsidiaries; or • restricting or prohibiting our use of the proceeds of any financing outside of China to finance our business and operations in China, and taking other regulatory or enforcement actions that could be harmful to our, including UL-CCIC’s, business.
If a violation of relevant laws or regulations is found, the relevant regulatory authorities would have broad discretion to take action in dealing with such violations by, among other things: • revoking our, including UL-CCIC’s, business or operating licenses; • shutting down our, including UL-CCIC’s, servers, blocking our, including UL-CCIC’s, website or discontinuing or placing restrictions or onerous conditions on our operation through any transactions involving UL-CCIC or any of our other Chinese subsidiaries; • imposing fines, confiscating the income of UL-CCIC or any of our other Chinese subsidiaries, blocking the offshore remittance of the profits and earnings of UL-CCIC or of any of our other Chinese subsidiaries or imposing other requirements with which we, including UL-CCIC, may not be able to comply; • requiring us to restructure UL-CCIC’s ownership or governance structure or operations, which in turn could materially affect our ability to consolidate, derive economic interests from or exert control over UL-CCIC or our other Chinese subsidiaries; or 31 • restricting or prohibiting our use of the proceeds of any financing outside of China to finance our business and operations in China, and taking other regulatory or enforcement actions that could be harmful to our, including UL-CCIC’s, business.
Potential conflicts or disputes may arise between UL Standards & Engagement or UL Research Institutes and us in a number of areas relating to our past or ongoing relationships, including: • our dividend policy or potential future share repurchase policy; • UL Research Institutes’ research activities and the business or interests of our customers; • intellectual property or other proprietary rights, including the use of our brand; • joint communications and branding activities with either or both entities; • operational activities related to support services provided by us to UL Standards & Engagement and UL Research Institutes, including information technology, human resources, benefits, finance and accounting, shared real estate, legal and other services; • business opportunities that may be attractive to us and either entity; • the nature, quality and pricing of services either entity has agreed, or may in the future agree, to provide us; • tax, employee benefit, indemnification and other matters arising from our relationship with either entity; • business combinations involving us; • any matters over which UL Standards & Engagement will have consent rights pursuant to our Amended Charter and the Stockholder Agreement; and • the terms of the current or future agreements between us and UL Standards & Engagement or UL Research Institutes.
Potential conflicts or disputes may arise between UL Standards & Engagement or UL Research Institutes and us in a number of areas relating to our past or ongoing relationships, including: • our dividend policy or potential future share repurchase policy; • UL Research Institutes’ research activities and the business or interests of our customers; • intellectual property or other proprietary rights, including the use of our brand; • joint communications and branding activities with either or both entities; 54 • operational activities related to support services provided by us to UL Standards & Engagement and UL Research Institutes, including information technology, human resources, benefits, finance and accounting, shared real estate, legal and other services; • business opportunities that may be attractive to us and either entity; • the nature, quality and pricing of services either entity has agreed, or may in the future agree, to provide us; • tax, employee benefit, indemnification and other matters arising from our relationship with either entity; • business combinations involving us; • any matters over which UL Standards & Engagement will have consent rights pursuant to our Amended Charter and the Stockholder Agreement; and • the terms of the current or future agreements between us and UL Standards & Engagement or UL Research Institutes.
For example, our Amended Charter provides that, from and after the Sunset Date: • our board of directors will be classified so that not all of our directors are elected at one time; • subject to the Stockholder Agreement, directors may only be removed for cause and only by the affirmative vote of at least two-thirds of the voting power of our outstanding common stock at a meeting duly called for that purpose; • our stockholders may not act without a meeting or by written consent, which may lengthen the amount of time required to take stockholder actions; • special meetings of our stockholders may be called only by the chairperson of our board of directors, our CEO or our board of directors (not by stockholders); and • the adoption, repeal, alteration, amendment or rescission of either our Amended Charter or our Amended Bylaws will require the approval of the holders of at least two-thirds of the voting power of the outstanding shares of our capital stock entitled to vote generally in the election of our directors.
For example, our Amended Charter provides that, from and after the Sunset Date: • our board of directors will be classified so that not all of our directors are elected at one time; 57 • subject to the Stockholder Agreement, directors may only be removed for cause and only by the affirmative vote of at least two-thirds of the voting power of our outstanding common stock at a meeting duly called for that purpose; • our stockholders may not act without a meeting or by written consent, which may lengthen the amount of time required to take stockholder actions; • special meetings of our stockholders may be called only by the chairperson of our board of directors, our CEO or our board of directors (not by stockholders); and • the adoption, repeal, alteration, amendment or rescission of either our Amended Charter or our Amended Bylaws will require the approval of the holders of at least two-thirds of the voting power of the outstanding shares of our capital stock entitled to vote generally in the election of our directors.
The sale and implementation of our software and related services subjects us to a number of risks, including but not limited to: • insufficient or incorrect information provided by customers, resulting in mismatched contractual commitments and execution; • insufficient customer expectation management, including with respect to scope, integration capabilities, implementation and the utilization of our solutions; • lack of customer commitments and respective engagements, including any insufficient commitment of resources or lack of solution migrations to the latest offerings, resulting in delays or deviations from recommended best practices; • challenges to effectively implementing acquired technologies; • unrenderable services committed during the sales stage; • security risks related to our hosting infrastructure that are not mitigated by cloud platforms; and • deviations from our standard terms and conditions.
The sale and implementation of our software and related services subjects us to a number of risks, including but not limited to: • insufficient or incorrect information provided by customers, resulting in mismatched contractual commitments and execution; • insufficient customer expectation management, including with respect to scope, integration capabilities, implementation and the utilization of our solutions; 39 • lack of customer commitments and respective engagements, including any insufficient commitment of resources or lack of solution migrations to the latest offerings, resulting in delays or deviations from recommended best practices; • challenges to effectively implementing acquired technologies; • unrenderable services committed during the sales stage; • security risks related to our hosting infrastructure that are not mitigated by cloud platforms; and • deviations from our standard terms and conditions.
Failure to properly handle, transport or dispose of these materials or otherwise conduct our operations in accordance with EHS or other applicable laws or requirements, or any injury or property damage caused by our employees at our or our customers’ facilities, could expose us to substantial liability for administrative, civil and criminal penalties, cleanup and site restoration costs and liability associated with releases of such materials, damages to natural resources and other damages, as well as potentially impair our ability to conduct our operations.
Failure to properly handle, transport or dispose of these materials or otherwise conduct our operations in accordance with EHS or other applicable laws or requirements, or any injury or property damage caused by our employees at our or our customers’ facilities, could expose us to substantial liability for administrative, civil and criminal penalties, cleanup and site restoration costs and liability associated with releases of such materials, damages to natural resources and other damages, as well as 21 potentially impair our ability to conduct our operations.
Further tariffs may be imposed that could cover imports of components and materials used in our customers’ products, or our business may be adversely impacted by retaliatory trade measures taken by mainland China or other countries, including restricted access to components or materials used in our customers’ products or increased amounts that must be paid for their products, which could significantly reduce demand for our services, in turn materially harming our business, financial condition and results of operations.
Further tariffs may be imposed that could cover imports of components and materials used in our customers’ products, or our business may be adversely impacted by retaliatory trade measures taken by mainland China or other countries, including restricted access to components or materials used in our customers’ products or increased amounts that must be paid for their products, which could significantly reduce demand for our services, in turn materially harming our business, financial condition and results of 18 operations.
Additionally, under our Amended Charter and the Stockholder Agreement, until UL Standards & Engagement no longer beneficially owns at least 25% of the voting power of our then-outstanding voting stock, we are restricted from paying or 58 declaring any dividend or other distribution that is inconsistent with our current dividend policy, or modifying or amending our dividend policy, without the prior written consent of UL Standards & Engagement.
Additionally, under our Amended Charter and the Stockholder Agreement, until UL Standards & Engagement no longer beneficially owns at least 25% of the voting power of our then-outstanding voting stock, we are restricted from paying or declaring any dividend or other distribution that is inconsistent with our current dividend policy, or modifying or amending our dividend policy, without the prior written consent of UL Standards & Engagement.
Any inability of current or potential customers to purchase or pay for our services due to, among other things, declining economic conditions as a result of inflation, rising interest rates, changes in spending patterns and the effects of governmental initiatives to manage economic conditions may have a negative impact on our business, prospects, financial condition and results of operations.
Any inability of current or potential customers to purchase or pay for our services due to, among other things, declining economic conditions as a result of inflation, rising interest rates, changes in spending patterns and the effects of governmental initiatives to manage economic conditions may have a negative impact on our business, financial condition and results of operations.
Although we have identified alternate third parties to 23 provide this service, we cannot guarantee we would be able to contract with such alternate third parties within a reasonable amount of time or at all, or upon similar pricing and volume terms, nor can we be assured that any such third party would be capable of producing our labels in sufficient volume and quality.
Although we have identified alternate third parties to provide this service, we cannot guarantee we would be able to contract with any such alternate third parties within a reasonable amount of time or at all, or upon similar pricing and volume terms, nor can we be assured that any such third party would be capable of producing our labels in sufficient volume and quality.
Any such actual or perceived incidents have and in the future could expose us to additional regulatory scrutiny and result in a violation of applicable data privacy laws and other laws, litigation exposure, regulatory fines, penalties or intervention, loss of confidence, reputational damage, reimbursement or other compensatory costs, and additional compliance costs, and could adversely impact our results of operations and financial condition.
Any such actual or perceived incidents have, and in the future could, expose us to additional regulatory scrutiny and result in a violation of applicable data privacy laws and other laws, litigation exposure, regulatory fines, penalties or intervention, loss of confidence, reputational damage, reimbursement or other compensatory costs, and additional compliance costs, and could adversely impact our business, financial condition and results of operations.
Further, we cannot provide assurance that we will be able to obtain adequate data on commercially acceptable terms from alternative sources if our current sources become unavailable. 41 A failure in the integrity of our data or the systems upon which we rely could harm our brand and result in a loss of sales and an increase in legal claims.
Further, we cannot provide assurance that we will be able to obtain adequate data on commercially acceptable terms from alternative sources if our current sources become unavailable. A failure in the integrity of our data or the systems upon which we rely could harm our brand and result in a loss of sales and an increase in legal claims.
If we are deemed to not have sufficient rights to the data we use to train our generative AI technologies, we may be subject to litigation by the owners of the content or other materials that comprise such data, similar to the litigation that is currently pending in various U.S. courts against other developers of 15 generative AI technologies, and in which the outcome of such litigation is uncertain.
If we are deemed to not have sufficient rights to the data we use to train our generative AI technologies, we may be subject to litigation by the owners of the content or other materials that comprise such data, similar to the litigation that is currently pending in various U.S. courts against other developers of generative AI technologies, and in which the outcome of such litigation is uncertain.
If we were to lose access to this external data, either temporarily or permanently, or if our access or use were restricted or were to become less economical or desirable, our ability to provide the full breadth of our S&A services and software solutions could be negatively impacted, which could have a material adverse effect on our business, financial condition and results of operations.
If we were to lose access to this external data, either temporarily or permanently, or if our access or use were restricted or were to become less economical or desirable, our ability to provide the full breadth of our services and software solutions could be negatively impacted, which could have a material adverse effect on our business, financial condition and results of operations.
While certain of these requirements are limited to listed companies, others (such as several laws adopted in California and the EU) apply to companies that meet certain operational thresholds. These requirements and evolving other stakeholder expectations will likely lead to increased costs, as well as scrutiny that could heighten all of the risks identified in this risk factor.
While certain of these requirements are limited to listed companies, others (such as several laws adopted in California and the EU) apply to companies that meet certain financial and operational thresholds. These requirements and evolving other stakeholder expectations will likely lead to increased costs, as well as scrutiny that could heighten all of the risks identified in this risk factor.
These improvements, as well as changes in customer preferences or regulatory requirements or transitions to non-traditional or free data sources or new technologies, may require changes in the technology used to gather and process our data and deliver our solutions. Further, we rely on third-party technology contractors that have extensive knowledge of our systems and database technologies.
These improvements, as well as changes in customer preferences or regulatory requirements or transitions to non-traditional or free data sources or new technologies, may require changes in the 40 technology used to gather and process our data and deliver our solutions. Further, we rely on third-party technology contractors that have extensive knowledge of our systems and database technologies.
In the event that our certification marks, trademarks or service marks are successfully challenged or cancelled, we could lose protection for them in the applicable jurisdiction, which could result in third parties using identical or confusingly similar marks to our trademarks, certification marks or service marks, loss of brand recognition, could require us to change the operation of our business and could require us to devote resources to advertising and marketing.
In the event that our certification marks, trademarks or service marks are successfully challenged or cancelled, we could lose protection for them in the applicable jurisdiction, which could result in third parties using identical or confusingly similar marks to our trademarks, certification marks or service marks, loss of brand recognition, could require us to change the operation of our business and could require us to devote additional resources to advertising and marketing.
Through our advisory services, we provide sustainability, quality, risk management and other solutions for our customers’ products and their product development, supply chains and organizations, as well as regulatory market access services. 22 Conflicts of interest may arise where we provide certain advisory services or solutions for products or customers to which we are also providing testing, inspection or certification services.
Through our advisory services, we provide sustainability, quality, risk management and other solutions for our customers’ products and their product development, supply chains and organizations, as well as regulatory market access services. Conflicts of interest may arise where we provide certain advisory services or solutions for products or customers to which we are also providing testing, inspection or certification services.
If we fail to establish and maintain effective internal control over financial reporting and disclosure controls and procedures, we may not be able to accurately report our financial results, or report them in a timely manner. As a public reporting company, we are subject to the rules and regulations established from time to time by the SEC and the NYSE.
If we fail to maintain effective internal control over financial reporting and disclosure controls and procedures, we may not be able to accurately report our financial results, or report them in a timely manner. As a public reporting company, we are subject to the rules and regulations established from time to time by the SEC and the NYSE.
Changes in our estimates could adversely affect our future reported financial condition or results of operations in the relevant period of change. We recognize revenue for certain performance obligations over time in accordance with ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606) , and related standards (“ASC 606”).
Changes in our estimates could adversely affect our future reported financial condition and results of operations in the relevant period of change. We recognize revenue for certain performance obligations over time in accordance with ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606) , and related standards (“ASC 606”).
ITEM 1A. Risk Factors UL Solutions’ business is subject to various risks and uncertainties. The following summary highlights some of the risks the Company is exposed to in the normal course of its business activities. If any of these risks actually occur, the Company’s business, financial condition or results of operations could be materially and adversely affected.
ITEM 1A. Risk Factors UL Solutions’ business is subject to various risks and uncertainties. The following summary highlights some of the risks the Company is exposed to in the normal course of its business activities. If any of these risks actually occur, the Company’s business, financial condition and results of operations could be materially and adversely affected.
Our customers may no longer choose us over our competitors and our relevance with key stakeholders, such as AHJs, may be diminished. This, in turn, could cause us to lose market share and our market leadership position, which could have a material adverse effect on our financial condition and results of operations.
Our customers may no longer choose us over our competitors, and our relevance with key stakeholders, such as AHJs, may be diminished. This, in turn, could cause us to lose market share and our market leadership position, which could have a material adverse effect on our business, financial condition and results of operations.
Other jurisdictions may decide to adopt similar or more restrictive legislation that may render the use of such technologies challenging. Additionally, certain privacy laws extend rights to individuals (such as the right to delete certain personal data) and regulate automated decision making, which may be incompatible with our AI features or our use of AI.
Other jurisdictions may adopt similar or more restrictive legislation that may render the use of such technologies challenging. Additionally, certain privacy laws extend rights to individuals (such as the right to delete certain personal data) and regulate automated decision making, which may be incompatible with our AI features or our use of AI.
Such compliance, any associated inquiries or investigations or any other government actions or the inconsistent interpretation, application or enforcement of laws or regulations could impact our China operations in the following ways: • delay or impede our development; • result in negative publicity, decrease demand for our services or increase our operating costs; • require significant management time and attention; • require us to obtain additional licenses, permits, approvals or certificates; • require us to exit certain industries or stop conducting business with certain customers; or • subject us to remedies, administrative penalties and even criminal liabilities that may harm our business, including fines assessed for our current or historical operations, or demands or orders that we refrain from contracting with customers in China or modify or even cease our business practices in China.
Such compliance, any associated inquiries or investigations or any other government actions or the inconsistent interpretation, application or enforcement of laws or regulations could impact our China operations in the following ways: • delay or impede our development; • result in negative publicity, decrease demand for our services or increase our operating costs; • require significant management time and attention; • require us to obtain additional licenses, permits, approvals or certificates; • require us to exit certain industries or stop conducting business with certain customers; or • subject us to remedies, administrative penalties and even criminal liabilities, including fines assessed for our current or historical operations, or demands or orders that we refrain from contracting with customers in China or modify or even cease our business practices in China.
Companies, businesses or operations acquired or joint ventures created may not be profitable or may not achieve revenue and profitability levels that would justify the investments made. Recent and future acquisitions could also result in the incurrence of indebtedness, subject to the restrictions contained in the documents governing our then-existing indebtedness.
Companies, businesses or operations acquired or joint ventures created may not be profitable or may not achieve revenue and profitability levels that justify the investments made. Recent and future acquisitions could also result in the incurrence of indebtedness, subject to the restrictions contained in the documents governing our then-existing indebtedness.
New York City time on (1) the seven year anniversary of the date of the closing of the IPO and (2) the date on which the number of outstanding shares of Class B common stock held by UL 54 Standards & Engagement and certain permitted transferees represents less than 35% of the shares of Class B common stock that UL Standards & Engagement held immediately following the IPO (the “Sunset Date”).
New York City time on (1) the seven year anniversary of the date of the closing of the IPO and (2) the date on which the number of outstanding shares of Class B common stock held by UL Standards & Engagement and certain permitted transferees represents less than 35% of the shares of Class B common stock that UL Standards & Engagement held immediately following the IPO (the “Sunset Date”).
If in the future we determine that there has been an impairment, our financial results for the relevant period would be reduced by the amount of the non-cash impairment charge, net of any income tax effects, which could have an adverse effect on our financial condition and results of operations.
If in the future we determine that there has been 60 an impairment, our financial results for the relevant period would be reduced by the amount of the non-cash impairment charge, net of any income tax effects, which could have an adverse effect on our financial condition and results of operations.
If we cannot adapt or meet the needs of our customers in the various regions in which we and our customers are located, we may not be able to continue to compete successfully on a global scale. We are subject to a variety of risks associated with doing business outside the United States.
If we cannot adapt or meet the needs of our customers in the various regions in which we and our customers are located, we may not be able to continue to compete successfully on a global scale. 16 We are subject to a variety of risks associated with doing business outside the United States.
In addition, to the extent that the economic benefits associated with any of our acquisitions diminish in the future, we may be required to record additional write-downs of goodwill, intangible assets or other assets associated with such acquisitions, which could adversely affect our business, prospects, financial condition and results of operations.
In addition, to the extent that the economic benefits associated with any of our acquisitions diminish in the future, we may be required to record additional write-downs of goodwill, intangible assets or other assets associated with such acquisitions, which could adversely affect our business, financial condition and results of operations.
In addition, CCIC could conduct business with other companies, organizations or institutions that attract unfavorable political attention in the United States, which could harm our reputation. Any such actions could negatively impact our relationship with CCIC, which would materially and adversely affect our business, financial condition, results of operations and profitability.
In addition, CCIC could conduct business with other companies, organizations or institutions that attract unfavorable political attention in the United States, which could harm our reputation. Any such actions could negatively impact our relationship with CCIC, which would materially and adversely affect our business, financial condition and results of operations.
Other jurisdictions we operate in may have similar restrictions on transfers outside of the jurisdiction. 39 These data privacy laws are uncertain, evolving and interpreted and applied in different ways in different countries, even with respect to definitions of personal information and concepts such as anonymization and pseudonymization.
Other jurisdictions we operate in may have similar restrictions on transfers outside of the jurisdiction. These data privacy laws are uncertain, evolving and interpreted and applied in different ways in different countries, even with respect to definitions of personal information and concepts such as anonymization and pseudonymization.
If we fail to protect our intellectual property rights adequately, our competitors may gain access to or copy our proprietary technology, use similar trademarks and certification marks and develop and commercialize substantially identical services or technologies, such that our business, financial condition, results of operations or prospects may be harmed.
If we fail to protect our intellectual property rights adequately, our competitors may gain access to or copy our proprietary technology, use similar trademarks and certification marks and develop and commercialize substantially identical services or technologies, such that our business, financial condition and results of operations may be harmed.
Accordingly, despite our efforts, we may be unable to prevent third parties from infringing upon, misappropriating or otherwise violating our intellectual property rights. Our inability to secure or enforce our intellectual property rights could have a material adverse effect on our business, results of operations and financial condition.
Accordingly, despite our efforts, we may be unable to prevent third parties from infringing upon, misappropriating or 47 otherwise violating our intellectual property rights. Our inability to secure or enforce our intellectual property rights could have a material adverse effect on our business, financial condition and results of operations.
For U.S. federal income tax purposes, a distribution we pay on a share of our Class A common stock generally will be treated as a dividend only to the extent the distribution is paid out of our current or accumulated earnings and profits, as determined under U.S. federal income tax principles.
For U.S. federal income tax purposes, a distribution we pay on a share of our Class A common stock generally will be treated as a dividend to the extent the distribution is paid out of our current or accumulated earnings and profits, as determined under U.S. federal income tax principles.
Future regulations or court interpretations established in the countries in which we conduct our operations could increase our costs and materially adversely affect our business, financial condition and results of operations. We lease many of our facilities, and we may be unable to renew our leases at the end of their terms.
Future regulations or court interpretations established in the countries in which we conduct our operations could increase our costs and materially adversely affect our business, financial condition and results of operations. 61 We lease many of our facilities, and we may be unable to renew our leases at the end of their terms.
We may incur costs to defend against, face liability for or be vulnerable to intellectual property infringement claims brought against us by others, as third parties have asserted and may assert claims against us alleging that we infringe upon, misappropriate, dilute or otherwise violate their intellectual property rights.
We may incur costs to defend against, face liability for or be vulnerable to intellectual property infringement claims brought against us by others, as third parties have asserted and may assert claims against us alleging that 48 we infringe upon, misappropriate, dilute or otherwise violate their intellectual property rights.
The choice of forum provisions may limit a stockholder’s ability to bring a claim in a judicial forum that it finds favorable for disputes with us or our current or former directors, officers or other employees or stockholders, which may discourage such lawsuits against us and our current or former directors, officers and other employees or stockholders.
The choice of forum provisions may limit a stockholder’s ability 58 to bring a claim in a judicial forum that it finds favorable for disputes with us or our current or former directors, officers or other employees or stockholders, which may discourage such lawsuits against us and our current or former directors, officers and other employees or stockholders.
Any such change in estimate could be significant and could have a material adverse effect on our reported financial condition or results of operations in the period of the change. Changes with respect to funded status of our pension and postretirement benefit plans could materially increase liabilities with respect thereto.
Any such change in estimate could be significant and could have a material adverse effect on our reported financial condition and results of operations in the period of the change. Changes with respect to funded status of our pension and postretirement benefit plans could materially increase liabilities with respect thereto.
We are required to obtain and hold permits, licenses, accreditations and other regulatory approvals from numerous governmental bodies, both in the United States and in other countries in which we operate, in order to comply with operating and security standards imposed by such bodies. We are also required to obtain various accreditations and professional 46 licenses.
We are required to obtain and hold permits, licenses, accreditations and other regulatory approvals from numerous governmental bodies, both in the United States and in other countries in which we operate, in order to comply with operating and security standards imposed by such bodies. We are also required to obtain various accreditations and professional licenses.
As a result, UL Standards & Engagement has control over a majority of the combined voting power of all of our Class A common stock and Class B common stock and therefore is able to control all matters submitted to our stockholders for approval until the earlier of 5:00 p.m.
As a result, UL Standards & Engagement has control over a majority of the combined voting power 51 of all of our Class A common stock and Class B common stock and therefore is able to control all matters submitted to our stockholders for approval until the earlier of 5:00 p.m.
For example, we work with customers, such as technology 63 companies and original equipment manufacturers, operating in the autonomous vehicle market who often demand uncapped liability for claims related to their proprietary information, such as trade secret claims or claims for breach of confidentiality.
For example, we work with customers, such as technology companies and original equipment manufacturers, operating in the autonomous vehicle market who often demand uncapped liability for claims related to their proprietary information, such as trade secret claims or claims for breach of confidentiality.
For example, in recent years, the Chinese government has published new policies that significantly affect certain industries, such as the education and internet industries, and we cannot rule out the possibility that the Chinese government will release new 29 or revised regulations or policies concerning or impacting our industry.
For example, in recent years, the Chinese government has published new policies that significantly affect certain industries, such as the education and internet industries, and we cannot rule out the possibility that the Chinese government will release new or revised regulations or policies concerning or impacting our industry.
Closing a facility, even briefly to relocate, would reduce the revenue that such facility would have contributed and could negatively impact our customer relations. Any such relocation or closure could have a material adverse effect on our business, prospects, financial condition and results of operations.
Closing a facility, even briefly to relocate, would reduce the revenue that such facility would have contributed and could negatively impact our customer relations. Any such relocation or closure could have a material adverse effect on our business, financial condition and results of operations.
As a result of our global operations, we generate a significant portion of our revenue and incur a significant portion of our expenses in currencies other than the U.S. dollar, primarily the euro, Japanese yen, Chinese renminbi, British pound sterling, Singapore dollar, New Taiwan dollar and the Korean won.
As a result of our global operations, we generate a significant portion of our revenue and incur a significant portion of our expenses in currencies other than the U.S. dollar, primarily the euro, the Japanese yen, the Chinese renminbi, the New Taiwan dollar, the Korean won and the British pound sterling.
For example, HIPAA is a federal law protecting patient health information and creating standards for entities subject to HIPAA, either as a covered entity or a business associate, and the Controlling the Assault of Non-Solicited Pornography and Marketing Act (“CAN-SPAM Act”) is a federal law that imposes certain obligations on business that send commercial emails, such as a requirement to include in every commercial email an “unsubscribe link.” In addition, the CCPA created individual data privacy rights for California residents, and places increased data privacy and security obligations on 38 entities handling certain personal information of California-resident consumers and households.
For example, HIPAA is a federal law protecting patient health information and creating standards for entities subject to HIPAA, either as a covered entity or a business associate, and the Controlling the Assault of Non-Solicited Pornography and Marketing Act (“CAN-SPAM Act”) is a federal law that imposes certain obligations on businesses that send commercial emails, such as a requirement to include in every commercial email an “unsubscribe link.” In addition, the CCPA created individual data privacy rights for California residents and places increased data privacy and security obligations on entities handling certain personal information of California-resident consumers and households.
Such failures could include misconfiguration of identity and access management controls, misconfiguration of firewalls, failure to update and patch software on a timely basis, falling victim to social engineering schemes (such as vishing) or negligent or intentional employee or contractor acts or omissions.
Such failures could include misconfiguration of identity and access management controls, misconfiguration of firewalls, failure to update and patch software on a timely basis, falling victim to social engineering schemes (such as phishing or vishing) or negligent or intentional employee or contractor acts or omissions.
The legislative, judicial and regulatory landscapes relating to data collection, use and processing are challenging to comply with and are evolving and may impact our ability to collect, use and process data, including personal information, and could limit our ability to operate and expand our business, cause revenue to decline and adversely affect our business.
The legislative, judicial and regulatory landscapes relating to data collection, use and processing are challenging to comply with and are evolving and impact our ability to collect, use and process data, including personal information, and could limit our ability to operate and expand our business, cause revenue to decline and adversely affect our business.
Our ability to provide our services to our customers and operate our global business requires that we work with certain third-party providers, including software vendors and network and cloud providers, and depends on such third parties meeting our expectations in both timeliness, quality, quantity and economics.
Our ability to provide our services to our customers and operate our global business requires that we work with certain third-party providers, including software vendors and network and cloud providers, and depends on such third parties meeting our expectations in timeliness, quality, quantity and economics.
However, our customers generally have no obligation to continue purchasing 42 additional services under their agreements with us, and there is no assurance that our customers will continue to request services under their agreements with us at the same or a higher level of service, if at all.
However, our customers generally have no obligation to continue purchasing additional services under their agreements with us, and there is no assurance that our customers will continue to request services under their agreements with us at the same or a higher level of service, if at all.
Any of the foregoing could have a material adverse effect on our business, financial condition and results of operations. Any unethical conduct by our employees, agents, customers, contractors or partners could result in financial penalties or affect our brand, reputation or image, any of which could have a material adverse impact on our business, financial condition and results of operations.
Any of the foregoing could have a material adverse effect on our business, financial condition and results of operations. Any unethical conduct by our employees, agents, customers, contractors or partners could result in financial penalties or affect our brand, reputation or image, any of which could have a material adverse effect on our business, financial condition and results of operations.
Any distribution (or portion of a distribution) not constituting a dividend will be treated as first reducing your adjusted basis in your shares of our Class A common stock and, to the extent that the distribution exceeds your adjusted basis in your shares of our Class A common stock, as gain from the sale or exchange of such shares.
Any distribution (or portion of a distribution) not constituting a dividend will be treated as first reducing your adjusted basis in your shares of our Class A common stock and, to the extent that the distribution exceeds your adjusted basis in your shares of our Class A common stock, as gain from the 55 sale or exchange of such shares.
In the future, as the information that we use to determine the expected duration of each revenue phase changes, this could result in further changes to the pattern of revenue recognition of our contracts and the corresponding contract assets and contract liabilities recorded to date under ASC 606.
In the future, as the information that we use to determine the expected duration of each revenue phase changes, this could result in changes to the pattern of revenue recognition of our contracts and the corresponding contract assets and contract liabilities recorded to date under ASC 606.
Our ability to realize the benefits we anticipate from our strategic transactions, including 25 acquisition activities, anticipated cost savings and additional sales opportunities, will largely depend upon whether we are able to integrate such businesses efficiently and effectively.
Our ability to realize the benefits we anticipate from our strategic transactions, including acquisition activities, anticipated cost savings and additional sales opportunities, will largely depend upon whether we are able to integrate such businesses efficiently and effectively.
In addition, our trade secrets, know-how and other proprietary information may be stolen, used in an unauthorized manner or compromised through a direct intrusion by private parties or foreign actors, including those affiliated with or controlled by state actors, through cyber intrusions into our computer systems, physical theft through corporate espionage or other means or through more indirect routes, including by joint venture partners, licensees that do not honor the terms of the license, potential licensees that were ultimately not licensed or other parties reverse engineering our solutions.
In addition, our trade secrets, know-how and other proprietary information may be stolen, used in an unauthorized manner or compromised through a direct intrusion by private parties or foreign actors, including those affiliated with or controlled by state actors, through cyber-attacks into our computer systems, physical theft through corporate espionage or other means or through more indirect routes, including by joint venture partners, licensees that do not honor the terms of the license, potential licensees that were ultimately not licensed or other parties reverse engineering our solutions.
Financial, Tax and General Risks Changes in tax laws or adverse outcomes resulting from examination of our tax returns or those of UL Standards & Engagement or UL Research Institutes could have a material adverse effect on our business, financial condition and 62 results of operations.
Financial, Tax and General Risks Changes in tax laws or adverse outcomes resulting from examination of our tax returns or those of UL Standards & Engagement or UL Research Institutes could have a material adverse effect on our business, financial condition and results of operations.
We are currently pursuing and defending various proceedings and will likely be subject to additional proceedings in the future, 47 including, among others, litigation regarding the services and solutions we provide, ordinary course employment litigation and intellectual property-related claims.
We are currently pursuing and defending various proceedings and will likely be subject to additional proceedings in the future, including, among others, litigation regarding the services and solutions we provide, ordinary course employment litigation and intellectual property-related claims.
We derive limited revenue from government customers and our government contracts may contain additional requirements that may increase our costs of doing business, subject us to additional government scrutiny and expose us to liability for failure to comply with 44 contractual requirements.
We derive limited revenue from government customers and our government contracts may contain additional requirements that may increase our costs of doing business, subject us to additional government scrutiny and expose us to liability for failure to comply with contractual requirements.
Further, those contracts and arrangements may be ineffective in protecting our intellectual property, may not prevent unauthorized disclosure, and do not prevent third parties from independently developing technologies that may be substantially equivalent or superior to our technology.
Further, those contracts may be ineffective in protecting our intellectual property, may not prevent unauthorized disclosure, and do not prevent third parties from independently developing technologies that may be substantially equivalent or superior to our technology.
A conflict of interest or perceived conflict of interest between our testing, inspection or certification services, on the one hand, and our advisory and other services, on the other hand, could adversely impact our accreditations or our reputation or expose us to legal liability.
A conflict of interest or perceived conflict of interest between our testing, inspection or certification services, on the one hand, and our advisory and other services, on the other hand, could adversely impact our accreditations or credentials or our reputation or expose us to legal liability.
Moreover, we have and could incur significant costs, including costs associated with paying the ransom, negotiating the ransom, notifying affected persons and entities and otherwise complying with the multitude of foreign, federal, state, and local laws and regulations.
Moreover, we have and could incur significant costs, including costs associated with paying the ransom, negotiating the ransom, notifying affected persons and entities and otherwise complying with a multitude of foreign, federal, state, and local laws and regulations.
An increase in interest rates would increase interest costs on our Credit Facility and any variable rate debt we incur, which could adversely impact our ability to refinance existing debt or acquire assets.
An increase in interest rates would increase interest costs on our 2025 Credit Facility and any variable rate debt we incur, which could adversely impact our ability to refinance existing debt or acquire assets.
The breach of any of these covenants or restrictions, if not waived or cured, if applicable, could result in the acceleration of all or a substantial portion of our outstanding debt under our Credit Facility and our notes.
The breach of any of these covenants or restrictions, if not waived or cured, if applicable, could result in the acceleration of all or a substantial portion of our outstanding debt under our 2025 Credit Facility and the notes.
These include: • difficulties associated with compliance with numerous, potentially conflicting and frequently complex and changing laws and regulations in multiple jurisdictions, such as with respect to business licensing and environmental matters, intellectual property, privacy and data protection, corrupt practices, embargoes, trade sanctions, competition, employment and licensing; • general economic, social and political conditions in countries where we operate, including international and U.S. trade policies, currency exchange rate fluctuations and political instability; • tax and other laws that reduce our profitability or restrict our ability to use tax credits, offset gains or repatriate funds, as well as changes in local and international tax laws, including transfer pricing regulations and changes in tax treaties, which may restrict our ability to use tax credits, offset gains, repatriate funds or result in adverse tax consequences; • any adverse changes in the regulatory environments applicable to us, which could negatively impact our business; • foreign exchange and currency restrictions, transfer pricing regulations and adverse tax consequences, which may affect our ability to transfer capital and profits; • inflation, deflation and stagflation in any country in which we have operations; • foreign customers with longer payment cycles than customers in the United States; and • imposition of or increases in customs duties and other tariffs.
These include: • difficulties associated with compliance with numerous, potentially conflicting and frequently complex and changing laws and regulations in multiple jurisdictions, such as with respect to business licensing and environmental matters, intellectual property, privacy and data protection, corrupt practices, embargoes, trade sanctions, competition, employment and licensing; • general economic, social and political conditions in countries where we operate, including international and U.S. trade, national security and other foreign policies, currency exchange rate fluctuations and political and economic instability; • tax and other laws that reduce our profitability or restrict our ability to use tax credits, offset gains or repatriate funds, as well as changes in local and international tax laws, including transfer pricing regulations and changes in tax treaties, which may restrict our ability to use tax credits, offset gains, repatriate funds or result in adverse tax consequences; • any adverse changes in the regulatory environments applicable to us, which could negatively impact our business; • foreign exchange and currency restrictions, transfer pricing regulations and adverse tax consequences, which may affect our ability to transfer capital and profits; • inflation, deflation and stagflation in any country in which we operate; • foreign customers with longer payment cycles than customers in the United States; and • imposition of or increases in customs duties and other tariffs.
For example, UL Research Institutes, which is the sole member of UL Standards & Engagement, could conduct safety-science research, the results of which may have 55 negative implications for certain of our customers or their products.
For example, UL Research Institutes, which is the sole member of UL Standards & Engagement, could conduct safety-science research, the results of which may have negative implications for certain of our customers or their products.
Subject to the Registration Rights Agreement and applicable law, UL Standards & Engagement will determine the timing and amount of such sales, which determination may be based upon UL Standards & Engagement’s funding needs or other factors UL Standards & Engagement deems relevant to the furtherance of its public safety charitable mission or otherwise in its best interests, and such sales could be executed by UL Standards & Engagement at a time or times that otherwise may not align with the interests of the Company and our other stockholders.
Subject to the Registration Rights Agreement and applicable law, UL Standards & Engagement will determine the timing and amount of such sales, which determination may be based upon UL Standards & Engagement’s funding needs or other factors UL Standards & Engagement deems relevant to the furtherance of its public safety mission or otherwise in its best interests, and such sales could be executed by UL Standards & Engagement at a time or times that otherwise may not align with our interests or the interests of our other stockholders.
The provisions of the Bribery Act also prohibit non-governmental commercial bribery, soliciting or accepting 17 bribes and “facilitation payments,” or small payments to low-level government officials to expedite routine approvals.
The provisions of the Bribery Act also prohibit non-governmental commercial bribery, soliciting or accepting bribes and “facilitation payments,” or small payments to low-level government officials to expedite routine approvals.
Such data security breaches, cyber-attacks, and other security incidents could occur in the future either at their location or ours, or within their systems or our systems, and affect personal or confidential information.
Such data security breaches, cyber-attacks, and other security incidents could occur in the future either at their location or ours, or within their systems or our systems, and affect confidential, personal or sensitive information.
Some of our operations involve destructive testing and the handling of hazardous materials that may pose the risk of fire, explosion, human exposure to hazardous substances or the release of hazardous substances into the environment.
Additionally, some of our operations involve destructive testing and the handling of hazardous materials that may pose the risk of fire, explosion, human exposure to hazardous substances or the release of hazardous substances into the environment.
For example, various policymakers (including the SEC, the EU and the State of California) have adopted and may, in the future, further adopt requirements for climate- or other ESG-related disclosures.
For example, various policymakers (including the SEC, the EU and the State of California) have adopted and may, in the future, further adopt requirements for climate- or other ESG-related disclosures and other actions.
We could also face claims that we performed erroneous or out-of-specification testing or data integrity complaints, which could require retesting, and which could result in claims of economic or other loss or which could result in personal injury.
We could also face claims that we performed erroneous or out-of-specification testing or data integrity complaints, which could require retesting or result in claims of economic or other loss or which could result in personal injury.
The UL Mark, in particular, is critical to our business and our brand, and any loss of protection of the UL Mark would likely have a material impact on 48 either or both.
The UL Mark, in particular, is critical to our business and our brand, and any loss of protection of the UL Mark would likely have a material impact on either or both.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeOur cybersecurity risk management program includes: • risk assessments designed to help identify material cybersecurity risks to our critical systems, information, products, services, and our broader enterprise IT environment; • a security team principally responsible for managing (1) our cybersecurity risk assessment processes, (2) our security controls, and (3) our response to cybersecurity incidents; • the use of external service providers, where appropriate, to assess, test or otherwise assist with aspects of our security controls; • cybersecurity awareness training of our employees, incident response personnel, and senior management; • a cybersecurity incident response plan that includes procedures for responding to cybersecurity incidents; and • a third-party risk management process for service providers, suppliers, and vendors. 66 We have not identified risks from known cybersecurity threats, including as a result of any prior cybersecurity incidents, that have materially affected or are reasonably likely to materially affect us, including our operations, business strategy, results of operations, or financial condition.
Biggest changeKey elements of our cybersecurity risk management program include but are not limited to the following: • risk assessments designed to help identify material cybersecurity risks to our critical systems, information, products, services, and our broader enterprise IT environment; • a security team principally responsible for managing (1) our cybersecurity risk assessment processes, (2) our security controls, and (3) our response to cybersecurity incidents; 62 • the use of external service providers, where appropriate, to assess, test or otherwise assist with aspects of our security controls; • cybersecurity awareness training of our employees and contractors, incident response personnel, and senior management; • a cybersecurity incident response plan that includes procedures for responding to cybersecurity incidents; and • a third-party risk management process for key service providers, suppliers, and vendors based on our assessment of their criticality to our operations and respective risk profile.
Our management team supervises efforts to prevent, detect, mitigate, and remediate cybersecurity risks and incidents through various means, which may include, among other things: briefings from internal security personnel; threat intelligence and other information obtained from governmental, public or private sources, including external consultants engaged by us; and alerts and reports produced by security tools deployed in the IT environment.
Our management team takes steps to stay informed about cybersecurity risks and developments and supervises efforts to prevent, detect, mitigate, and remediate cybersecurity risks and incidents through various means, which may include, among other things: briefings from internal security personnel; threat intelligence and other information obtained from governmental, public or private sources, including external consultants engaged by us; and alerts and reports produced by security tools deployed in the IT environment.
Cybersecurity Governance Our Board considers cybersecurity risk as part of its risk oversight function and it oversees management’s implementation of our cybersecurity risk management program. In addition, the Board has delegated to the Audit Committee of the Board oversight of our enterprise risk management (“ERM”) process, which regularly identifies, assesses, and mitigates enterprise and emerging risks, including cybersecurity related risks.
In addition, the board of directors has delegated to the Audit Committee of the board of directors oversight of our enterprise risk management (“ERM”) process, which regularly identifies, assesses, and mitigates enterprise and emerging risks, including cybersecurity-related risks. Our board of directors receives semi-annual reports from management on our cybersecurity risks and our cyber risk management program.
The CISO has primary responsibility for our overall cybersecurity risk management program and supervises both our internal cybersecurity personnel and our retained external cybersecurity consultants.
Our CISO, who reports to our Chief Transformation Officer, is responsible for assessing and managing our material risks from cybersecurity threats. The CISO has primary responsibility for our overall cybersecurity risk management program and supervises both our internal cybersecurity personnel and our retained external cybersecurity consultants.
Board members receive presentations on cybersecurity topics from our Chief Information Security Officer (“CISO”), internal security staff or external experts as part of the Board’s continuing education on topics that impact public companies. Our CISO, who reports to our Chief Transformation Officer, is responsible for assessing and managing our material risks from cybersecurity threats.
In addition, management updates the board of directors, as necessary, regarding any material cybersecurity incidents. Board members receive presentations on cybersecurity topics from our Chief Information Security Officer (“CISO”), internal security staff or external experts as part of the board of directors’ continuing education on topics that impact public companies.
Removed
The Board receives semi-annual reports from management on our cybersecurity risks and our cyber risk management program. In addition, management updates the Board, as necessary, regarding any material cybersecurity incidents.
Added
In the prior twelve months, we did not identify risks from known cybersecurity threats, including as a result of any prior cybersecurity incidents, that have materially affected or are reasonably likely to materially affect us, including our operations, business strategy, results of operations, or financial condition.
Added
Cybersecurity Governance Our board of directors considers cybersecurity risk as part of its risk oversight function and it oversees management’s implementation of our cybersecurity risk management program.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeOur global network of offices, coupled with our technical laboratories across the world, enable us to offer our customers the services they need in their local markets.
Biggest changeAlongside our headquarters, as of December 31, 2025, we had 58 additional locations that are exclusively dedicated to office space in 26 countries. Our global network of offices, coupled with our technical laboratories across the world, enable us to offer our customers the services they need in their local markets.
Overall, our centralized global laboratory operations enable us to deliver a consistent and streamlined experience for our customers. We leverage our network of laboratories to improve collaboration, speed and transparency, while maintaining uniform 67 operational measurement, accountability and quality control in delivering outcomes for our customers.
Overall, our centralized global laboratory operations enable us to deliver a consistent and streamlined experience for our customers. We leverage our network of laboratories to improve collaboration, speed and transparency, while maintaining uniform operational measurement, accountability and quality control in delivering outcomes for our customers.
We operate 37 laboratory sites throughout Asia, 34 laboratory sites in the Americas and 20 laboratory sites in Europe, the Middle East and Africa. These laboratories use more than 140,000 pieces of test equipment and enable us to offer high-quality testing capabilities across a diverse set of standards, regulations and customer and market specific requirements.
We operate 36 laboratory sites throughout Asia, 31 laboratory sites in the Americas and 20 laboratory sites in Europe, the Middle East and Africa. These laboratories use more than 140,000 pieces of test equipment and enable us to offer high-quality testing capabilities across a diverse set of standards, regulations and customer and market specific requirements.
Footprint and Facilities In addition to our leading network of laboratories around the world, we have a broad and global portfolio of offices and facilities. Our corporate headquarters are located at 333 Pfingsten Road, Northbrook, Illinois 60062. We own the property and building where our headquarters are located.
Footprint and Facilities In addition to our leading network of laboratories around the world, we have a broad and global portfolio of offices and facilities. Our corporate headquarters is located at 333 Pfingsten Road, Northbrook, Illinois 60062. We own the property and building where our headquarters is located, which spans approximately 979,000 square feet.
As of December 31, 2024, we leased or owned 91 sites with laboratories spread across 26 countries. Further, we have four laboratory locations under construction to meet local market and technology needs to strengthen our industry leading footprint and global capabilities. Our laboratories employ approximately 3,400 employees and span over 5 million square feet.
As of December 31, 2025, we leased or owned 87 sites with laboratories spread across 27 countries. Further, we have one laboratory location under construction and three undergoing expansion to meet local market and technology needs to strengthen our industry leading footprint and global capabilities. Our laboratories employ approximately 3,400 employees and span over 5 million square feet.
Properties The table below sets forth certain information regarding our owned and leased properties as of December 31, 2024: Owned Leased Total Sites with laboratories 17 74 91 Dedicated office spaces — 59 59 Total locations 17 133 150 Laboratories Footprint We operate and maintain a global laboratory network with deep technical capabilities in order to serve our customers.
Properties The table below sets forth certain information regarding our owned and leased properties as of December 31, 2025: Owned Leased Total Sites with laboratories 17 70 87 Dedicated office spaces — 58 58 Total locations 17 128 145 63 Laboratories Footprint We operate and maintain a global laboratory network with deep technical capabilities in order to serve our customers.
Removed
Our headquarters span approximately 979,000 square feet and include approximately 411,000 square feet for corporate office space and 221,000 square feet of laboratory space and common areas of 347,000 square feet. Alongside our headquarters, as of December 31, 2024, we had 59 additional locations that are exclusively dedicated to office space in 26 countries.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeDiscussion of these and other legal matters is incorporated by reference from Part II, Item 8, Note 19, “Commitments and Contingencies,” of this Annual Report and should be considered an integral part of Part I, Item 3, “Legal Proceedings.” ITEM 4. Mine Safety Disclosures Not applicable. 68 PART II
Biggest changeDiscussion of these and other legal matters is incorporated by reference from Part II, Item 8, Note 19, “Commitments and Contingencies,” of this Annual Report and should be considered an integral part of Part I, Item 3, “Legal Proceedings.” ITEM 4. Mine Safety Disclosures Not applicable. 64 PART II

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeA summary of cash dividends per share on the outstanding UL Solutions common stock declared to shareholders by the Company’s Board during the twelve months ended December 31, 2024 is presented below: Declaration Date Shareholders of Record as of Close of Business Date Payment Date Dividends per share 3/14/2024 3/14/2024 3/29/2024 $ 0.125 5/22/2024 6/3/2024 6/18/2024 $ 0.125 8/13/2024 8/30/2024 9/9/2024 $ 0.125 11/13/2024 11/29/2024 12/9/2024 $ 0.125 On February 11, 2025, the Company declared a regular cash dividend of $0.13 per share, an increase from the previous $0.125 per share.
Biggest changeA summary of cash dividends per share on the outstanding UL Solutions common stock declared to stockholders by the Company’s board of directors during the twelve months ended December 31, 2025 is presented below: Declaration Date Stockholders of Record as of Close of Business Date Payment Date Dividends per share Amount (in millions) 2/11/2025 2/28/2025 3/10/2025 $ 0.13 $ 26 5/20/2025 5/30/2025 6/9/2025 $ 0.13 $ 26 8/19/2025 8/29/2025 9/8/2025 $ 0.13 $ 27 11/11/2025 11/28/2025 12/8/2025 $ 0.13 $ 26 On February 10, 2026, the Company declared a regular cash dividend of $0.145 per share, an increase from the previous $0.13 per share.
The comparisons in the graph below are based upon historical data and are not indicative of, nor intended to forecast, future performance of the Company’s Class A common stock. 69 Information used in the graph was obtained from a source we believe to be reliable, but we do not assume responsibility for any errors or omissions in such information.
The comparisons in the graph below are based upon historical data and are not indicative of, nor intended to forecast, future performance of the Company’s Class A common stock. 65 Information used in the graph was obtained from a source we believe to be reliable, but we do not assume responsibility for any errors or omissions in such information.
ITEM 5. Market for the Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities The Company’s common stock is listed on the New York Stock Exchange (“NYSE”), trading under the symbol “ULS.” As of February 12, 2025, there was one holder of record of the Company’s Class A common stock.
ITEM 5. Market for the Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities The Company’s common stock is listed on the New York Stock Exchange (“NYSE”), trading under the symbol “ULS.” As of February 13, 2026, there was one holder of record of the Company’s Class A common stock.
There is no established public trading market for the Company’s Class B common stock. As of February 12, 2025, the Company’s Class B common stock was held by one stockholder, ULSE Inc. Dividends The Company currently intends to continue paying a regular cash dividend on its common stock.
There is no established public trading market for the Company’s Class B common stock. As of February 13, 2026, the Company’s Class B common stock was held by one stockholder, ULSE Inc. Dividends The Company currently intends to continue paying a regular cash dividend on its common stock.
Issuer Purchases of Equity Securities None. ITEM 6. Reserved
Recent Sales of Unregistered Securities None. Issuer Purchases of Equity Securities None. ITEM 6. Reserved

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

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Biggest changeNon U.S. 2024 2023 2022 2024 2023 2022 Expected rate of return on plan assets 6.9 % 7.8 % 6.0 % 2.4 - 5.6% 1.6 - 5.6% 1.2 - 4.8% Actual rate of return on plan assets 10.2 % 16.7 % (15.5) % 2.9 - 9.9% 1.0 - 18.1% (38.2) - 9.8% 90 The following table illustrates the impact on 2024 net periodic benefit costs of a 100 basis point change in the expected return on plan assets used to measure net periodic benefit costs, holding all other assumptions constant: Increase (Decrease) in Net Periodic Benefit Cost (in millions, pre-tax) -1.0% +1.0% U.S. pension plan $ 2 $ (2) Non U.S. pension plans 1 (1) Income Taxes The Company recognizes deferred tax assets and liabilities based on the temporary differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases, net operating loss carryforwards and tax credit carryforwards.
Biggest changeNon U.S. 2025 2024 2023 2025 2024 2023 Expected rate of return on plan assets 6.9 % 6.9 % 7.8 % 2.4 - 4.9% 2.4 - 5.6% 1.6 - 5.6% Actual rate of return on plan assets 14.5 % 10.2 % 16.7 % (13.2) - 8.3% 2.9 - 9.9% 1.0 - 18.1% The impact on 2025 net periodic benefit costs of a 100 basis point change in the expected return on plan assets used to measure net periodic benefit costs, holding all other assumptions constant, would not be material.
Adjusted EBITDA does not take into account certain significant items, including depreciation and amortization, interest expense, other (income) expense, net, income tax expense, stock-based compensation expense for equity-settled awards, material asset impairment charges and restructuring expenses which directly affect the Company’s net income, as applicable.
Adjusted EBITDA does not take into account certain significant items, including depreciation and amortization, interest expense, other expense (income), net, income tax expense, stock-based compensation expense for equity-settled awards, material asset impairment charges and restructuring expenses which directly affect the Company’s net income, as applicable.
Adjusted Net Income and Adjusted Diluted Earnings Per Share do not take into account certain significant items, including other (income) expense, net, stock-based compensation expense for equity-settled awards, material asset impairment charges and restructuring expenses which directly affect the Company’s net income and diluted earnings per share, as applicable.
Adjusted Net Income and Adjusted Diluted Earnings Per Share do not take into account certain significant items, including other expense (income), net, stock-based compensation expense for equity-settled awards, material asset impairment charges and restructuring expenses which directly affect the Company’s net income and diluted earnings per share, as applicable.
The State Administration for Foreign Exchange (“SAFE”), under the authority of the People’s Bank of China, is in charge of the conversion of renminbi into other currencies and the remittance thereof abroad and, under Chinese foreign exchange regulations, cash generated from UL-CCIC may not be used to pay dividends without SAFE approval.
The State Administration for Foreign Exchange (“SAFE”), under the authority of the People’s Bank of China, is in charge of the conversion of renminbi into other currencies 84 and the remittance thereof abroad and, under Chinese foreign exchange regulations, cash generated from UL-CCIC may not be used to pay dividends without SAFE approval.
The Company measures the present value of these future benefits on a plan-by-plan basis by matching projected benefit payment cash flows for each future period with the yields of a portfolio of 89 high quality, fixed-income debt instruments that would produce cash flows sufficient in timing and amount to settle projected future benefits.
The Company measures the present value of these future benefits on a plan-by-plan basis by matching projected benefit payment cash flows for each future period with the yields of a portfolio of high quality, fixed-income debt instruments that would produce cash flows sufficient in timing and amount to settle projected future benefits.
Since January 1, 2023, the Company has completed the following acquisitions and divestitures, including those that impact the comparability of results between periods: • In July 2024, the Company acquired 100% of the outstanding stock of TesTneT Engineering GmbH (together with its subsidiaries, “TesTneT”) for approximately $19 million.
Since January 1, 2024, the Company has completed the following acquisitions and divestitures, including those that impact the comparability of results between periods: • In July 2024, the Company acquired 100% of the outstanding stock of TesTneT Engineering GmbH (together with its subsidiaries, “TesTneT”) for approximately $19 million.
For the year ended December 31, 2024, the effective tax rate differed from the U.S. federal 76 statutory tax rate primarily due to earnings subject to lower tax rates in certain foreign jurisdictions and a reduction to uncertain tax positions as a result of expiration of the statute of limitations.
For the year ended December 31, 2024, the effective rate differed from the U.S. federal statutory tax rate primarily due to earnings subject to lower tax rates in certain foreign jurisdictions and a reduction to uncertain tax positions as a result of expiration of the statute of limitations.
These requirements, addressed through standard certification and inspection 72 services, are designed to validate the continued compliance of the Company’s customers’ previously certified products, components and systems. Services are delivered through periodic inspections, initial and follow-up audits, sample testing and UL Solutions label usage.
These requirements, addressed through standard certification and inspection services, are designed to validate the continued compliance of the Company’s customers’ previously certified products, components and systems. Services are delivered through periodic inspections, initial and follow-up audits, sample testing and UL Solutions label usage.
In addition, cost of revenue includes services and materials expenses including facility related costs for laboratories and other buildings where testing and inspection services are performed, customer-related travel costs, expenses related to third-party contractors or third-party facilities and consumable materials and supplies used in testing and inspection and other costs associated with generating revenue.
In addition, cost of revenue includes services and materials expenses including occupancy and facility-related costs for laboratories and other buildings where testing and inspection services are performed, customer-related travel costs, expenses related to third-party contractors or third-party facilities and consumable materials and supplies used in testing and inspection and other costs associated with generating revenue.
Operating income change from an acquisition or disposal is measured as Acquisition / Divestiture for the initial twelve-month period following the acquisition or disposal date. Subsequently, operating income impact from the acquired or disposed business is measured as Organic. Acquisition / Divestiture also includes the change in due diligence related costs for merger and acquisition and disposal activities.
Operating income change from an acquisition or disposal is measured as Acquisition / Divestiture for the initial twelve-month 70 period following the acquisition or disposal date. Subsequently, operating income impact from the acquired or disposed business is measured as Organic. Acquisition / Divestiture also includes the change in due diligence-related costs for merger and acquisition and disposal activities.
Components of the Company’s Results of Operations Revenue The Company generates revenue from the services it provides to customers through the following service categories. Certification Testing The Company evaluates products, components and systems according to global or regional regulatory requirements and other design and performance specifications.
Components of the Company’s Results of Operations Revenue The Company generates revenue from the services it provides to customers through the following service categories. 68 Certification Testing The Company evaluates products, components and systems according to global or regional regulatory requirements and other design and performance specifications.
The Company defines these components of revenue as follows: “Organic” reflects revenue change in a given period excluding Acquisition / Divestiture and FX in that same year, expressed in dollars or as a percentage of revenue in the prior period.
The Company defines these components of revenue as follows: “Organic” reflects revenue change in a given period excluding Acquisition / Divestiture and FX in that same period, expressed in dollars or as a percentage of revenue in the prior period.
As of December 31, 2024, the Company provided independent third-party testing, inspection and certification (“TIC”) services and related software and advisory (“S&A”) offerings to more than 80,000 customers in over 110 countries. UL Solutions is the largest TIC services provider headquartered in North America (by revenue), and it maintains a leadership position across additional global markets, including Europe and Asia.
As of December 31, 2025, the Company provided independent third-party testing, inspection and certification (“TIC”) services and related software and advisory (“S&A”) offerings to more than 80,000 customers in over 110 countries. UL Solutions is the largest TIC services provider headquartered in North America (by revenue), and it maintains a leadership position across additional global markets, including Europe and Asia.
TesTneT is a Germany-based company that provides testing services for various hydrogen storage systems, refueling stations and their components. The results of operations of TesTneT are included in the Industrial segment since the date of acquisition. • In May 2024, the Company acquired 100% of the outstanding stock of Batterielngenieure GmbH (together with its subsidiaries, “Batterielngenieure”) for approximately $11 million.
TesTneT is a Germany-based company that provides testing services for various hydrogen storage systems, refueling stations and their components. The results of operations of TesTneT are included in the Industrial segment since the date of acquisition. • In May 2024, the Company acquired 100% of the outstanding stock of Batterielngenieure GmbH (together with its subsidiaries, “Batterielngenieure”) for approximately $12 million.
This segment represented 13% of the Company’s consolidated revenue for both the years ended December 31, 2024 and 2023. The Company generates revenue in this segment through two major service categories: Software and Non-certification Testing and Other Services. The software and technical advisory offerings enable the Company’s customers to manage complex regulatory requirements, deliver supply chain transparency and operationalize sustainability.
This segment represented 13% of the Company’s consolidated revenue for both the years ended December 31, 2025 and 2024. The Company generates revenue in this segment through two major service categories: Software and Non-certification Testing and Other Services. The software and technical advisory offerings enable the Company’s customers to manage complex regulatory requirements, deliver supply chain transparency and operationalize sustainability.
This partial impairment charge was the result of lower than expected demand for Non-certification Testing and Other Services in the mobility industry, which has been impacted by auto industry conditions in 2023, including slowing of the pace of electric vehicle transition, labor uncertainties, and the impact of more moderate growth expectations for the business.
This partial impairment charge was the result of lower than expected demand for Non-certification Testing and Other Services in the mobility industry, which was impacted by auto industry conditions in 2023, including slowing of the pace of electric vehicle transition, labor uncertainties, and the impact of more moderate growth expectations for the business.
Management’s Discussion and Analysis of Financial Condition and Results of Operations The following discussion and analysis includes a comparison of the Company’s results of operations, financial condition and liquidity and capital resources for the years ended December 31, 2024 and 2023 and should be read in conjunction with the Company’s consolidated financial statements and the related notes which are included in this Annual Report.
Management’s Discussion and Analysis of Financial Condition and Results of Operations The following discussion and analysis includes a comparison of the Company’s results of operations, financial condition and liquidity and capital resources for the years ended December 31, 2025 and 2024 and should be read in conjunction with the Company’s consolidated financial statements and the related notes which are included in this Annual Report.
The Credit Facility includes customary representations and warranties, covenants and events of default, subject to certain customary exceptions, materiality thresholds and grace periods.
The 2025 Credit Facility includes customary representations and warranties, covenants and events of default, subject to certain customary exceptions, materiality thresholds and grace periods.
Future borrowings under the Credit Facility are subject to the satisfaction of customary conditions, including the absence of any default or event of default and the accuracy of representations and warranties. Senior Notes In October 2023, the Company issued $300 million in aggregate principal amount of 6.500% senior notes due 2028 (the “notes”).
Future borrowings under the 2025 Credit Facility are subject to the satisfaction of customary conditions, including the absence of any default or event of default and the accuracy of representations and warranties. 83 Senior Notes In October 2023, the Company issued $300 million in aggregate principal amount of 6.500% senior notes due 2028 (the “notes”).
It is reasonably likely that changes in external factors will result in changes to the assumptions used to measure the Company’s pension plans. For a description of the Company’s pension plans and the related accounting estimates, refer to Item 8, “Notes to the Consolidated Financial Statements”, Note 12 “Pension and Postretirement Benefit Plans”.
It is reasonably likely that changes in external factors will result in changes to the assumptions used to measure the Company’s pension plans. For a description of the Company’s pension plans and the related accounting estimates, refer to Item 8, “Notes to the Consolidated Financial Statements”, Note 11 “Pension and Postretirement Benefit Plans”.
Effective from the date of the First Credit Facility Amendment, borrowings under the Credit Facility bear interest at a rate per annum equal to, at the Company’s option, (a) in the case of U.S. dollar loans, the Term SOFR plus a SOFR adjustment of 0.1% plus a margin, and for all other currencies, a specified benchmark rate for the applicable currency plus, in certain instances, a specified spread adjustment plus a margin (loans with a rate based on this clause (a), “benchmark rate loans”) or (b) for U.S. dollar loans only, the base rate plus a margin (loans with a rate based on this clause (b), “base rate loans”).
Effective from the date of the First Credit Facility Amendment, borrowings under the 2022 Credit Facility bore interest at a rate per annum equal to, at the Company’s option, (a) in the case of U.S. dollar loans, the Term SOFR plus a SOFR adjustment of 0.1% plus a margin, and for all other currencies, a specified benchmark rate for the applicable currency plus, in certain instances, a specified spread adjustment plus a margin (loans with a rate based on this clause (a), “benchmark rate loans”) or (b) for U.S. dollar loans only, the base rate plus a margin (loans with a rate based on this clause (b), “base rate loans”).
As of December 31, 2024, the margin was 1.125% for benchmark rate loans and 0.125% for base rate loans but may be adjusted based on the Company’s most recently tested consolidated net leverage ratio and may vary from 1.0% to 1.5% for benchmark rate loans and 0% to 0.5% for base rate loans.
As of December 31, 2024, the margin was 1.125% for benchmark rate loans and 0.125% for base rate loans but could be adjusted based on the Company’s most recently tested consolidated net leverage ratio and could vary from 1.0% to 1.5% for benchmark rate loans and 0% to 0.5% for base rate loans.
Income Tax Expense Income tax expense consists of current and deferred federal and state taxes for the Company’s U.S. and foreign jurisdictions. Net Income Net income is calculated as revenue less cost of revenue, selling, general and administrative expenses, goodwill impairment, interest expense, other income (expense), net and income tax expense.
Income Before Income Taxes Income before income taxes is calculated as revenue less cost of revenue, selling, general and administrative expenses, goodwill impairment, restructuring, interest expense and other (expense) income, net. Income Tax Expense Income tax expense consists of current and deferred federal and state taxes for the Company’s U.S. and foreign jurisdictions.
The calculation of the consolidated net leverage ratio permits the netting of up to $250 million of unrestricted cash from funded debt. As of December 31, 2024, the Company was in compliance with all covenants under this facility.
The calculation of the consolidated net leverage ratio permits the netting of up to $250 million of unrestricted cash from funded debt. As of December 31, 2025, the Company was in compliance with all covenants under this facility.
The Company believes the combination of cash and cash equivalents on hand, the generation of cash from operating activities, funds available under the Credit Facility and the Company’s ability to access the capital markets provide sufficient liquidity to meet the Company’s cash requirements for working capital, capital expenditures, service of indebtedness and to address other needs for the next twelve months and the foreseeable future thereafter, as well as to finance acquisitions, make contributions to the Company’s pension and postretirement plans and pay dividends to stockholders as the Company’s board of directors deems appropriate.
The Company believes the combination of cash and cash equivalents on hand and short-term investments, the generation of cash from operating activities, funds available under the 2025 Credit Facility, and the Company’s ability to access the capital markets provide sufficient liquidity to meet the Company’s cash requirements for working capital, capital expenditures, service of indebtedness and to address other needs for the next twelve months and the foreseeable future thereafter, as well as to finance acquisitions, make contributions to the Company’s pension and postretirement plans and pay dividends to stockholders, as the Company’s board of directors deems appropriate.
The Company uses its internally developed long-range plans to estimate future cash flows and include an estimate of long‑term future growth rates based on its most recent views of the long‑term outlook for each reporting unit.
The Company uses its internally developed long-range plans to estimate future cash flows, which include an estimate of long‑term future growth rates based on its most recent views of the long‑term outlook for each reporting unit.
With more than 650 accreditations and the ability to test and certify against more than 4,000 standards, the Company believes it is positioned to benefit from ongoing demand growth within the Company’s addressable market.
With more than 650 technical accreditations and the ability to test and certify against more than 4,000 global standards, the Company believes it is positioned to benefit from ongoing demand growth within the Company’s addressable market.
The Credit Facility includes an accordion feature permitting an increase in the Credit Facility by an aggregate amount of up to $625 million (of which up to $400 million may consist of term loans), subject to the consent of any lenders providing such increase, the absence of any default or event of default and entry into customary documentation with respect to such increase.
The 2022 Credit Facility included an accordion feature permitting an increase in the 2022 Credit Facility by an aggregate amount of up to $625 million (of which up to $400 million may consist of term loans), subject to the consent of any lenders providing such increase, the absence of any default or event of default and entry into customary documentation with respect to such increase.
The Credit Facility also includes a financial covenant tested quarterly which requires the Company to maintain a consolidated net leverage ratio of not greater than 3.5 to 1.0, calculated on a consolidated basis for each consecutive four fiscal quarter period, with an increase in the maintenance level to 4.0 to 1.0 for each of the four test periods immediately following any permitted acquisition that involves the payment of aggregate consideration in excess of $100 million, subject to a two fiscal 85 quarter rest period between increases for separate acquisitions.
The 2025 Credit Facility also includes a financial covenant, tested quarterly, which requires the Company to maintain a consolidated net leverage ratio of not greater than 3.5 to 1.0, calculated on a consolidated basis for each consecutive four fiscal quarter period, with an increase in the maintenance level to 4.0 to 1.0 for each of the four test periods immediately following any permitted acquisition that involves the payment of aggregate consideration in excess of $100 million, commencing with the fiscal quarter in which such permitted acquisition occurred, subject to a two fiscal quarter rest period between increases for separate acquisitions.
The Company uses Adjusted EBITDA, Adjusted EBITDA margin, Adjusted Net Income, Adjusted Net Income margin and Adjusted Diluted Earnings Per Share to measure the operational strength and performance of its business and the Company believes these measures provide additional information to investors about certain non-cash items and unusual items that are not expected to continue at the same level in the future.
The Company uses Adjusted EBITDA, Adjusted EBITDA margin, Adjusted Net Income, Adjusted Net Income margin and Adjusted Diluted Earnings Per Share to measure the operational strength and performance of its business and believes these measures provide additional information to investors about certain non-cash items and unusual items that the Company does not expect to continue at the same level in the future.
At December 31, 2024, the remaining goodwill related to this reporting unit was no longer considered at risk of further impairment.
At December 31, 2025, the remaining goodwill related to this reporting unit was no longer considered at risk of further impairment.
The Company reviews its actuarial assumptions on an annual basis and make modifications to the assumptions based on current rates and trends when appropriate.
The Company reviews its actuarial assumptions on an annual basis and makes modifications to the assumptions based on current rates and trends when appropriate.
Adjusted EBITDA margin is calculated as Adjusted EBITDA as a percentage of revenue. 80 The table below reconciles net income to Adjusted EBITDA.
Adjusted EBITDA margin is calculated as Adjusted EBITDA as a percentage of revenue. 77 The table below reconciles net income to Adjusted EBITDA.
Adjusted Net Income margin is calculated as Adjusted Net Income as a percentage of revenue. 82 The table below reconciles net income to Adjusted Net Income.
Adjusted Net Income margin is calculated as Adjusted Net Income as a percentage of revenue. 79 The table below reconciles net income to Adjusted Net Income.
Significant assumptions used in estimating the projected benefit obligation of the Company’s plans include the discount rate and the expected return on plan assets. Other assumptions include health care cost trends and demographic factors such as retirement patterns, mortality, turnover and rate of compensation increases.
Significant assumptions used in estimating the projected benefit obligation of the Company’s plans include the discount rate and the expected return on plan assets. Other assumptions include demographic factors such as retirement patterns, mortality, turnover and rate of compensation increases.
(“UL Solutions” and the “Company”) is a global safety science leader with a distinguished and trusted brand that dates back to its founding in 1894 as part of the nonprofit Underwriters Electrical Bureau, a predecessor to 70 Underwriters Laboratories Inc. (“UL Research Institutes”), ULSE Inc. (“UL Standards & Engagement”) and UL Solutions.
Business Overview UL Solutions is a global safety science leader with a distinguished and trusted brand that dates back to its founding in 1894 as part of the nonprofit Underwriters Electrical Bureau, a predecessor to Underwriters Laboratories Inc. (“UL Research Institutes”), ULSE Inc. (“UL Standards & Engagement”) and UL Solutions.
The Company had $6 million and $7 million outstanding in letters of credit, surety bonds, and performance and other guarantees with financial institutions as of December 31, 2024 and 2023, respectively. In June 2024, the Company entered into an amendment (the “First Credit Facility Amendment”) to the Credit Facility with Bank of America, N.A. and certain other lenders.
The Company had $6 million outstanding in letters of credit, surety bonds, and performance and other guarantees with financial institutions as of December 31, 2024 under the 2022 Credit Facility. In June 2024, the Company entered into an amendment (the “First Credit Facility Amendment”) to the 2022 Credit Facility with Bank of America, N.A. and certain other lenders.
Year Ended December 31, 2024 2023 2022 Diluted earnings per share $ 1.62 $ 1.30 $ 1.47 Other (income) expense, net (0.04) (0.07) 0.06 Stock-based compensation 0.12 — — Goodwill impairment — 0.19 — Restructuring (0.01) 0.02 — Tax effect of adjustments (a) 0.01 — (0.01) Adjusted Diluted Earnings Per Share $ 1.70 $ 1.44 $ 1.52 __________ (a) The Company computed the tax effect of adjustments to net earnings by applying the statutory tax rate in the relevant jurisdictions to the taxable income or expense items that are adjusted in the period presented.
Year Ended December 31, 2025 2024 2023 Diluted earnings per share $ 1.60 $ 1.62 $ 1.30 Other expense (income), net 0.06 (0.04) (0.07) Stock-based compensation 0.23 0.12 — Goodwill impairment — — 0.19 Restructuring 0.17 (0.01) 0.02 Tax effect of adjustments (a) (0.07) 0.01 — Adjusted Diluted Earnings Per Share $ 1.99 $ 1.70 $ 1.44 __________ (a) The Company computed the tax effect of adjustments to net earnings by applying the statutory tax rate in the relevant jurisdictions to the taxable income or expense items that are adjusted in the period presented.
These measures are not financial measures calculated in accordance with GAAP and should not be considered as a substitute for net income, operating income, diluted earnings per share, net cash provided by operating activities or any other measure calculated in accordance with GAAP, and may not be comparable to similarly titled measures reported by other companies.
These measures are not financial measures calculated in accordance with GAAP and should not be considered as a substitute for net income, operating income, diluted earnings per share, net cash provided by operating activities or any other measure calculated in accordance with GAAP, and may not be comparable to similarly titled measures reported by other companies due to potential differences between the companies in calculations.
This segment represented 43% and 44% of the Company’s consolidated revenue for the years ended December 31, 2024 and 2023, respectively. The Company generates revenue in this reportable segment primarily through three major service categories: Certification Testing; Ongoing Certification Services; and Non-certification Testing and Other Services.
This segment represented 43% of the Company’s consolidated revenue for both the years ended December 31, 2025 and 2024. The Company generates revenue in this reportable segment primarily through three major service categories: Certification Testing; Ongoing Certification Services; and Non-certification Testing and Other Services.
The unused commitment fee varies from 0.1% to 0.2% based on the Company’s most recently tested consolidated net leverage ratio.
The unused commitment fee could vary from 0.1% to 0.2% based on the Company’s most recently tested consolidated net leverage ratio.
The Company pays interest on the notes semi-annually in arrears on April 20 and October 20 of each year, which began on April 20, 2024.
UL Solutions pays interest on the notes semi-annually in arrears on April 20 and October 20 of each year, which began on April 20, 2024.
For the year ended December 31, 2024, the Company paid dividends to stockholders of $100 million. For the year ended December 31, 2023, the Company paid dividends of $680 million to its then sole stockholder, UL Standards & Engagement, which comprised quarterly dividends of $20 million and a $600 million special cash dividend during December of 2023.
For the year ended December 31, 2023, the Company paid dividends of $680 million to its then sole stockholder, UL Standards & Engagement, which comprised quarterly dividends of $20 million and a $600 million special cash dividend in December 2023.
Long-Term Debt Credit Facility In January 2022, the Company entered into a credit agreement with Bank of America, N.A. and certain other lenders, which provides for senior unsecured credit facilities in an aggregate principal amount of $1,250 million (collectively, the “Credit Facility”), consisting of term loans in an initial aggregate principal amount of $500 million and revolving loan commitments in an initial aggregate commitment amount of $750 million (including a $25 million sub-facility for letters of credit).
Long-Term Debt 2022 Credit Facility In January 2022, the Company entered into a credit agreement with Bank of America, N.A. and certain other lenders, which provided for senior unsecured credit facilities in an aggregate principal amount of $1.25 billion (collectively, and as amended, the “2022 Credit Facility”), consisting of term loans in an initial aggregate principal amount of $500 million and revolving loan commitments in an initial aggregate commitment amount of $750 million (including a $25 million sub-facility for letters of credit).
Year Ended December 31, (in millions, unless otherwise stated) 2024 2023 2022 Net income $ 345 $ 276 $ 309 Other (income) expense, net (8) (13) 12 Stock-based compensation 23 — — Goodwill impairment — 37 — Restructuring (1) 4 — Tax effect of adjustments (a) 2 — (2) Adjusted Net Income $ 361 $ 304 $ 319 Revenue $ 2,870 $ 2,678 $ 2,520 Net income margin 12.0 % 10.3 % 12.3 % Adjusted Net Income margin 12.6 % 11.4 % 12.7 % __________________ (a) The Company computed the tax effect of adjustments to net earnings by applying the statutory tax rate in the relevant jurisdictions to the taxable income or expense items that are adjusted in the period presented.
Year Ended December 31, (in millions, unless otherwise stated) 2025 2024 2023 Net income $ 345 $ 345 $ 276 Other expense (income), net 11 (8) (13) Stock-based compensation 47 23 — Goodwill impairment — — 37 Restructuring 35 (1) 4 Tax effect of adjustments (a) (15) 2 — Adjusted Net Income $ 423 $ 361 $ 304 Revenue $ 3,053 $ 2,870 $ 2,678 Net income margin 11.3 % 12.0 % 10.3 % Adjusted Net Income margin 13.9 % 12.6 % 11.4 % __________________ (a) The Company computed the tax effect of adjustments to net earnings by applying the statutory tax rate in the relevant jurisdictions to the taxable income or expense items that are adjusted in the period presented.
Batterielngenieure is a Germany-based battery testing company that is in the process of building a laboratory in Aachen, Germany to replace the leased facility it is currently using and to add testing and simulation capacity.
Batterielngenieure is a Germany-based battery testing company that was, at the time of acquisition, in the process of building a laboratory in Aachen, Germany to replace the leased facility it was using and to add testing and simulation capacity.
The Company uses Free Cash Flow as an additional liquidity measure and believes it provides useful information to investors about the cash generated from its core operations that may be available to repay debt, make other investments and return cash to stockholders. There are material limitations to using these non-GAAP financial measures.
The Company uses Free Cash Flow and Free Cash Flow margin as additional liquidity measures and believes they provide useful information to investors about the cash generated from the Company’s core operations that may be available to repay debt, make other investments and return cash to stockholders. 76 There are material limitations to using these non-GAAP financial measures.
Cash Flows The following table is a summary of the Company’s cash flow activity: Year Ended December 31, (in millions) 2024 2023 2022 Net cash provided by operating activities $ 524 $ 467 $ 372 Net cash used in investing activities $ (234) $ (175) $ (238) Net cash used in financing activities $ (284) $ (294) $ (1,116) Cash flows from operating activities Net cash provided by operating activities was $524 million for the year ended December 31, 2024, an increase of $57 million compared to net cash provided by operating activities of $467 million for the same period in 2023.
Cash Flows The following table is a summary of the Company’s cash flow activity: Year Ended December 31, (in millions) 2025 2024 2023 Net cash provided by operating activities $ 600 $ 524 $ 467 Net cash used in investing activities $ (204) $ (234) $ (175) Net cash used in financing activities $ (396) $ (284) $ (294) Cash flows from operating activities Net cash provided by operating activities was $600 million for the year ended December 31, 2025, an increase of $76 million compared to net cash provided by operating activities of $524 million for the same period in 2024.
The following table illustrates the impact of changes in the significant assumptions used in the income and market approaches on the fair value of the reporting unit, holding all other assumptions constant: Change Decrease to fair value determined by respective approach (in millions) Income approach Revenue growth rate in each year of the forecast period -100bps $ 4 EBITDA margin in each year of the forecast period -100bps $ 6 Discount rate +100bps $ 6 Market approach Market multiples -10 % $ 6 The Company did not recognize any impairments of goodwill for the years ended December 31 2024 or 2022.
While a third-party valuation specialist was used for assistance, the fair value analysis reflects the conclusions of management and not those of any third party. 86 The following table illustrates the impact of changes in the significant assumptions used in the income and market approaches on the fair value of the reporting unit, holding all other assumptions constant: Change Decrease to fair value determined by respective approach (in millions) Income approach Revenue growth rate in each year of the forecast period -100bps $ 4 EBITDA margin in each year of the forecast period -100bps $ 6 Discount rate +100bps $ 6 Market approach Market multiples -10 % $ 6 The Company did not recognize any impairments of goodwill for the years ended December 31, 2025 or 2024.
Year Ended December 31, (in millions, unless otherwise stated) 2024 2023 2022 Net income $ 345 $ 276 $ 309 Net income margin 12.0 % 10.3 % 12.3 % Adjusted EBITDA $ 656 $ 563 $ 547 Adjusted EBITDA margin 22.9 % 21.0 % 21.7 % Adjusted Net Income $ 361 $ 304 $ 319 Adjusted Net Income margin 12.6 % 11.4 % 12.7 % Diluted Earnings per Share $ 1.62 $ 1.30 $ 1.47 Adjusted Diluted Earnings per Share $ 1.70 $ 1.44 $ 1.52 Net Cash provided by Operating Activities $ 524 $ 467 $ 372 Free Cash Flow $ 287 $ 252 $ 208 Adjusted EBITDA The Company defines Adjusted EBITDA as net income adjusted for depreciation and amortization expense, interest expense, other (income) expense, net, income tax expense, as well as stock-based compensation expense for equity-settled awards, material asset impairment charges and restructuring expenses, as applicable.
Year Ended December 31, (in millions, unless otherwise stated) 2025 2024 2023 Net income $ 345 $ 345 $ 276 Net income margin 11.3 % 12.0 % 10.3 % Adjusted EBITDA $ 792 $ 656 $ 563 Adjusted EBITDA margin 25.9 % 22.9 % 21.0 % Adjusted Net Income $ 423 $ 361 $ 304 Adjusted Net Income margin 13.9 % 12.6 % 11.4 % Diluted Earnings per Share $ 1.60 $ 1.62 $ 1.30 Adjusted Diluted Earnings Per Share $ 1.99 $ 1.70 $ 1.44 Net Cash provided by Operating Activities $ 600 $ 524 $ 467 Net cash provided by operating activities margin 19.7 % 18.3 % 17.4 % Free Cash Flow $ 403 $ 287 $ 252 Free Cash Flow margin 13.2 % 10.0 % 9.4 % Adjusted EBITDA The Company defines Adjusted EBITDA as net income adjusted for depreciation and amortization expense, interest expense, other expense (income), net, income tax expense, as well as stock-based compensation expense for equity-settled awards, material asset impairment charges and restructuring expenses, as applicable.
These estimates and assumptions were considered Level 3 inputs under the fair value hierarchy. The Company believes the assumptions used in the impairment assessment are reasonable and consistent with assumptions that would be used by other market participants. However, such assumptions are inherently uncertain, and a change in assumptions could change the estimated fair value of the reporting unit.
The Company believes the assumptions used in the impairment assessment are reasonable and consistent with assumptions that would be used by other market participants. However, such assumptions are inherently uncertain, and a change in assumptions could change the estimated fair value of the reporting unit.
Year Ended December 31, (in millions, unless otherwise stated) 2024 2023 2022 Net income $ 345 $ 276 $ 309 Depreciation and amortization expense 172 154 135 Interest expense 55 35 17 Other (income) expense, net (8) (13) 12 Income tax expense 70 70 74 Stock-based compensation 23 — — Goodwill impairment — 37 — Restructuring (1) 4 — Adjusted EBITDA $ 656 $ 563 $ 547 Revenue $ 2,870 $ 2,678 $ 2,520 Net income margin 12.0 % 10.3 % 12.3 % Adjusted EBITDA margin 22.9 % 21.0 % 21.7 % 81 The table below reconciles segment operating income to segment Adjusted EBITDA.
Year Ended December 31, (in millions, unless otherwise stated) 2025 2024 2023 Net income $ 345 $ 345 $ 276 Depreciation and amortization expense 188 172 154 Interest expense 41 55 35 Other expense (income), net 11 (8) (13) Income tax expense 125 70 70 Stock-based compensation 47 23 — Goodwill impairment — — 37 Restructuring 35 (1) 4 Adjusted EBITDA $ 792 $ 656 $ 563 Revenue $ 3,053 $ 2,870 $ 2,678 Net income margin 11.3 % 12.0 % 10.3 % Adjusted EBITDA margin 25.9 % 22.9 % 21.0 % 78 The table below reconciles segment operating income to segment Adjusted EBITDA.
These items are subtracted from cash from operating activities because they represent long-term investments that are required for normal business activities. The table below reconciles net cash provided by operating activities to Free Cash Flow.
These items are subtracted from cash from operating activities because they represent long-term investments that are required for normal business activities. Free Cash Flow margin is calculated as Free Cash Flow as a percentage of revenue. 80 The table below reconciles net cash provided by operating activities to Free Cash Flow.
Revenue change is calculated as the percentage change in revenue in one period relative to the prior period’s revenue and is a key financial measure that the Company uses to manage its business.
Components of Revenue Change The Company uses Organic, Acquisition / Divestiture and FX to explain the change in revenue from period to period. Revenue change is calculated as the percentage change in revenue in one period relative to the prior period’s revenue and is a key financial measure that the Company uses to manage its business.
Several countries in which the Company operates have adopted aspects of the Organization for Economic Cooperation and Development’s Pillar Two rules, which impose a 15% corporate minimum tax, into their local legislation effective January 1, 2024.
Several countries in which the Company operates have enacted into their local legislation, effective either January 1, 2024, or January 1, 2025, aspects of the Organisation for Economic Co-operation and Development’s Pillar Two rules, which impose a 15% corporate minimum tax.
Segment Operating Income Segment operating income increased by $30 million, or 9.7%, for the year ended December 31, 2024, as compared to the same period in 2023 primarily due to the $136 million increase in organic revenue noted above.
Segment Operating Income Segment operating income increased by $8 million for the year ended December 31, 2025, as compared to the same period in 2024, primarily due to the $76 million increase in organic revenue noted above.
Subsequently, the revenue impact from the acquired or disposed business is measured as Organic. “FX” reflects the impact that foreign currency exchange rates have on revenue in a given period, expressed in dollars or as a percentage of revenue in the prior period.
“FX” reflects the impact that foreign currency exchange rates have on revenue in a given period, expressed in dollars or as a percentage of revenue in the prior period.
Cost of revenue also includes depreciation on equipment used in testing and amortization of capitalized software. 73 Selling, General and Administrative Expenses Selling, general and administrative expenses include employee compensation consisting of salaries, incentives, stock-based compensation and other benefits for sales and indirect administrative functions such as executive, finance, legal, human resources and information technology, not included within cost of revenue.
Selling, General and Administrative Expenses Selling, general and administrative expenses include employee compensation consisting of salaries, incentives, stock-based compensation and other benefits for sales and indirect administrative functions such as executive, finance, legal, human resources and information technology, not included within cost of revenue.
Income Tax The Company's effective income tax rate was 16.9% for the year ended December 31, 2024, compared to 20.2% for the year ended December 31, 2023.
Income Tax The Company’s effective income tax rate was 26.6% for the year ended December 31, 2025, compared to 16.9% for the year ended December 31, 2024.
As of December 31, 2024, the Company had $298 million in cash and cash equivalents and $745 million of unused availability under the Credit Facility and access to an accordion feature permitting an increase in the Credit Facility by an aggregate amount of up to $625 million (of which up to $400 million may consist of term loans), subject to the consent of any lenders providing such increase, the absence of any default or event of default and entry into customary documentation with respect to such increase.
As of December 31, 2025, the Company had $295 million in cash and cash equivalents, $8 million in short-term investments, and $803 million of unused availability under the 2025 Credit Facility and access to an accordion feature permitting an increase in the 2025 Credit Facility by an aggregate amount of up to $500 million, subject to the consent of any lenders providing such increase, the absence of any default or event of default and entry into customary documentation with respect to such increase.
The Company used the net proceeds from the offering of the notes, together with borrowings under the Credit Facility and cash on hand, to fund a special cash dividend, which was paid to UL Standards & Engagement in December 2023. See “—Dividends.” Interest on the notes accrues at 6.500% per annum.
The Company used the net proceeds from the offering of the notes, together with borrowings under the 2022 Credit Facility and cash on hand, to fund a $600 million special cash dividend, which was paid to UL Standards & Engagement in December 2023.
Other Income (Expense), net Other income (expense), net consists primarily of non-operating gains and losses, including gains and losses related to foreign exchange transactions and the revaluation performed on designated balance sheet accounts, interest income, gains and losses on equity investments, non-operating pension and postretirement benefit expenses and gains on divestitures. 74 Income Before Income Taxes Income before income taxes is calculated as revenue less cost of revenue, selling, general and administrative expenses, goodwill impairment, interest expense and other income (expense), net.
Other (Expense) Income, net Other (expense) income, net consists primarily of non-operating gains and losses, including gains and losses related to foreign exchange transactions and the revaluation performed on designated balance sheet accounts, interest income, gains and losses on equity investments, non-operating pension and postretirement benefit expenses and gains on divestitures.
Year Ended December 31, (in millions, unless otherwise stated) 2024 2023 2022 Industrial Segment operating income $ 338 $ 308 $ 286 Depreciation and amortization expense 47 38 32 Stock-based compensation 9 — — Restructuring — 1 — Adjusted EBITDA $ 394 $ 347 $ 318 Revenue $ 1,254 $ 1,146 $ 1,044 Operating income margin 27.0 % 26.9 % 27.4 % Adjusted EBITDA margin 31.4 % 30.3 % 30.5 % Consumer Segment operating income $ 114 $ 45 $ 101 Depreciation and amortization expense 79 75 66 Stock-based compensation 11 — — Goodwill impairment — 37 — Restructuring (1) 2 — Adjusted EBITDA $ 203 $ 159 $ 167 Revenue $ 1,238 $ 1,172 $ 1,128 Operating income margin 9.2 % 3.8 % 9.0 % Adjusted EBITDA margin 16.4 % 13.6 % 14.8 % Software and Advisory Segment operating income $ 10 $ 15 $ 25 Depreciation and amortization expense 46 41 37 Stock-based compensation 3 — — Restructuring — 1 — Adjusted EBITDA $ 59 $ 57 $ 62 Revenue $ 378 $ 360 $ 348 Operating income margin 2.6 % 4.2 % 7.2 % Adjusted EBITDA margin 15.6 % 15.8 % 17.8 % Adjusted EBITDA $ 656 $ 563 $ 547 Adjusted Net Income The Company defines Adjusted Net Income as net income adjusted for other (income) expense, net, stock-based compensation expense for equity-settled awards, material asset impairment charges and restructuring expenses, as applicable, each net of tax.
Year Ended December 31, (in millions, unless otherwise stated) 2025 2024 2023 Industrial Segment operating income $ 386 $ 338 $ 308 Depreciation and amortization expense 56 47 38 Stock-based compensation 19 9 — Restructuring 7 — 1 Adjusted EBITDA $ 468 $ 394 $ 347 Revenue $ 1,341 $ 1,254 $ 1,146 Operating income margin 28.8 % 27.0 % 26.9 % Adjusted EBITDA margin 34.9 % 31.4 % 30.3 % Consumer Segment operating income $ 122 $ 114 $ 45 Depreciation and amortization expense 81 79 75 Stock-based compensation 20 11 — Goodwill impairment — — 37 Restructuring 26 (1) 2 Adjusted EBITDA $ 249 $ 203 $ 159 Revenue $ 1,319 $ 1,238 $ 1,172 Operating income margin 9.2 % 9.2 % 3.8 % Adjusted EBITDA margin 18.9 % 16.4 % 13.6 % Software and Advisory Segment operating income $ 14 $ 10 $ 15 Depreciation and amortization expense 51 46 41 Stock-based compensation 8 3 — Restructuring 2 — 1 Adjusted EBITDA $ 75 $ 59 $ 57 Revenue $ 393 $ 378 $ 360 Operating income margin 3.6 % 2.6 % 4.2 % Adjusted EBITDA margin 19.1 % 15.6 % 15.8 % Adjusted EBITDA $ 792 $ 656 $ 563 Adjusted Net Income The Company defines Adjusted Net Income as net income adjusted for other expense (income), net, stock-based compensation expense for equity-settled awards, material asset impairment charges and restructuring expenses, as applicable, adjusted to give effect to the income tax impact of such adjustments.
Cash flows from investing activities Net cash used in investing activities was $234 million for the year ended December 31, 2024, an increase of $59 million compared to net cash used in investing activities of $175 million for the same period in 2023.
Cash flows from financing activities Net cash used in financing activities was $396 million for the year ended December 31, 2025, an increase of $112 million compared to net cash used in financing activities of $284 million for the same period in 2024.
If a valuation allowance exists, the rate applied is zero. Adjusted Diluted Earnings Per Share The Company defines Adjusted Diluted Earnings Per Share as diluted earnings per share attributable to stockholders of UL Solutions adjusted for other (income) expense, net, stock-based compensation expense for equity-settled awards, material asset impairment charges and restructuring expenses, as applicable.
Adjusted Diluted Earnings Per Share The Company defines Adjusted Diluted Earnings Per Share as diluted earnings per share attributable to stockholders of UL Solutions adjusted for other expense (income), net, stock-based compensation expense for equity-settled awards, material asset impairment charges and restructuring expenses, as applicable, adjusted to give effect to the income tax impact of such adjustments.
Cash paid for capital expenditures increased $22 million, to $237 million for the year ended December 31, 2024, compared to $215 million for the same period in 2023.
Cash paid for capital expenditures decreased $40 million, to $197 million for the year ended December 31, 2025, compared to $237 million for the same period in 2024.
Any such determination will also depend upon periodic determinations by the Company’s board of directors that cash dividends are in the best interest of the Company’s stockholders, and will be based upon its earnings, cash flow, business outlook and prospects, results of operations, financial condition, liquidity, future cash requirements and availability and other factors that the Company’s board of directors may deem relevant. 86 The jurisdictions in which the Company’s subsidiaries are incorporated generally have corporate law restrictions on the ability to pay dividends, which the Company is required to observe when effecting intra-group dividends.
Any such determination will also depend upon periodic determinations by the Company’s board of directors that cash dividends are in the best interest of the Company’s stockholders, and will be based upon its earnings, cash flow, business outlook and prospects, results of operations, financial condition, liquidity, future cash requirements and availability and other factors that the Company’s board of directors may deem relevant.
“Acquisition / Divestiture” is calculated as revenue change in a given period related to acquisitions or disposals of businesses using prior period exchange rates, expressed in dollars or as a percentage of revenue in the prior period. Revenues from an acquisition or disposal are measured as Acquisition / Divestiture for the initial twelve-month period following the acquisition or disposal date.
“Acquisition / Divestiture” is calculated as revenue change in a given period related to acquisitions or disposals of businesses using prior period exchange rates, expressed in dollars or as a percentage of revenue in the prior period.
Development of the long-range plans 88 includes consideration of current and projected levels of income for the reporting unit based on management’s plans for the business, business trends, market and economic conditions, as well as other relevant factors.
Development of the long-range plans includes consideration of current and projected levels of income for the reporting unit based on management’s plans for the business, business trends, market and economic conditions, as well as other relevant factors. The fair value using the market approach was derived from market multiples using comparable publicly traded companies for a group of benchmark companies.
The following tables summarize the change in Software and Advisory’s revenue and operating income for the periods presented: Year Ended December 31, (in millions) 2024 2023 Change % Change Revenue $ 378 $ 360 $ 18 5.0 % Employee compensation 255 241 14 5.8 % Services and materials 67 63 4 6.3 % Depreciation and amortization 46 41 5 12.2 % Segment operating income $ 10 $ 15 $ (5) (33.3) % Segment operating income margin 2.6 % 4.2 % Year Ended December 31, 2024 (in millions) Organic Acquisition / Divestiture FX Total Revenue change $ 16 $ 2 $ — $ 18 Segment operating income change $ (6) $ — $ 1 $ (5) Revenue Revenue increased by $18 million, or 5.0%, for the year ended December 31, 2024, as compared to the same period in 2023.
The software and technical advisory offerings enable the Company’s customers to manage complex regulatory requirements, deliver supply chain transparency and operationalize sustainability. 75 The following tables summarize the change in Software and Advisory’s revenue and operating income for the periods presented: Year Ended December 31, (in millions) 2025 2024 Change % Change Revenue $ 393 $ 378 $ 15 4.0 % Employee compensation 261 255 6 2.4 % Services and materials 65 67 (2) (3.0) % Depreciation and amortization 51 46 5 10.9 % Restructuring 2 — 2 — % Segment operating income $ 14 $ 10 $ 4 40.0 % Segment operating income margin 3.6 % 2.6 % Year Ended December 31, 2025 (in millions) Organic Acquisition / Divestiture FX Total Revenue change $ 14 $ — $ 1 $ 15 Segment operating income change $ 8 $ (4) $ — $ 4 Revenue Revenue increased by $15 million, or 4.0%, for the year ended December 31, 2025, as compared to the same period in 2024.
On an organic basis, revenue increased $81 million, or 6.9%, primarily due to Non-certification Testing and Other Services revenue growth of $44 million in retail due to increased demand and capacity and in consumer technology driven by higher electromagnetic compatibility testing for automotive and consumer electronics. Certification Testing revenue increased $23 million due to medical growth and strength in HVAC.
On an organic basis, revenue increased $76 million, or 6.1%, primarily due to Non-certification Testing and Other Services revenue growth of $43 million in consumer technology driven by increased demand for electromagnetic compatibility testing for consumer electronics and in retail. FX increased revenue by $5 million, or 0.4%, primarily due to the relative strength of the euro.
For additional information refer to “—Liquidity and Capital Resources.” Other Income (Expense), net Other income (expense), net decreased by $5 million in the year ended December 31, 2024 as compared to the same period in 2023.
For additional information refer to “—Liquidity and Capital Resources.” Other (Expense) Income, net Other (expense) income, net decreased by $19 million for the year ended December 31, 2025, as compared to the same period in 2024, primarily due to a $24 million gain on divestiture of the Company’s payments testing business in May 2024.
For a comparison of our results of operations, financial condition and liquidity and capital resources for the years ended December 31, 2023 and 2022, see “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Prospectus, dated September 5, 2024, filed with the SEC pursuant to Rule 424(b)(4) on September 6, 2024 , which is incorporated herein by reference.
For a comparison of our results of operations, financial condition and liquidity and capital resources for the years ended December 31, 2024 and 2023, see “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report on Form 10-K for the fiscal year ended December 31, 2024, filed with the SEC on February 20, 2025, which discussion is incorporated herein by reference.
If the qualitative analysis indicates it is more likely than not that the fair value of a reporting unit is below its carrying amount, the Company performs a quantitative impairment assessment for that reporting unit. The Company did not perform a qualitative analysis for any of its reporting units for the years ended December 31, 2024 or December 31, 2023.
To evaluate the recoverability of a reporting unit’s goodwill the Company has the option to first perform a qualitative analysis. If the qualitative analysis indicates it is more likely than not that the fair value of a reporting unit is below its carrying amount, the Company performs a quantitative impairment assessment for that reporting unit.
Segment Operating Income Segment operating income decreased by $5 million for the year ended December 31, 2024, as compared to the same period in 2023 primarily due to a $22 million organic increase in expenses, partially offset by the $16 million increase in organic revenue noted above.
Segment Operating Income Segment operating income increased by $48 million, or 14.2%, for the year ended December 31, 2025, as compared to the same period in 2024 primarily due to the $89 million increase in organic revenue noted above.
Dividends On February 11, 2025, the Company declared a regular cash dividend of 13 cents per share. The Company paid regular quarterly cash dividends on its common stock of 12.5 cents per share in 2024 and 10 cents per share in 2023.
The Company paid regular quarterly cash dividends on its common stock of 13 cents per share in 2025, 12.5 cents per share in 2024 and 10 cents per share in 2023. The Company will periodically assess the size of the regular quarterly dividend based on its dividend policy and certain factors described in this Annual Report.
Net income margin is calculated as net income as a percentage of revenue. Results of Operations The following tables set forth the Company’s condensed consolidated results of operations for the periods presented.
Results of Operations The following tables set forth the Company’s condensed consolidated results of operations for the periods presented.
Acquisitions / Divestitures decreased cost of revenue by $7 million, primarily due to the sale of the payments testing business.
Acquisitions / Divestitures decreased revenue by $8 million, or 0.3%, primarily due to the sale of the payments testing business in the Industrial segment in 2024.
The tax benefits recognized in the financial statements from such a position are measured based on the largest benefit that is more-likely-than-not to be realized upon settlement. The Company adjusts its liability for unrecognized tax benefits in the period they are settled, the statute of limitations expires, or when new information becomes available.
The tax benefits recognized in the financial statements from such a position are measured based on the largest benefit that is more-likely-than-not to be realized upon settlement.
The Company may also redeem some or all of the notes at any time prior to their maturity pursuant to the indenture’s provisions and limitations.
The Company may also redeem some or all of the notes at any time prior to their maturity pursuant to the indenture’s provisions and limitations. Dividends On February 10, 2026, the Company declared a regular cash dividend of 14.5 cents per share.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

11 edited+2 added−3 removed6 unchanged
Biggest changeA hypothetical 100 basis point change in interest rates affecting the Credit Facility would result in a change to the annual interest expense of approximately $4 million , based on outstanding borrowings at December 31, 2024 .
Biggest changeThe interest rate for the 2025 Credit Facility as of December 31, 2025 was 4.78%, which was a floating rate based on the Term SOFR plus a margin. A hypothetical 100 basis point change in interest rates affecting the 2025 Credit Facility would not result in a material change to interest expense, based on outstanding borrowings at December 31, 2025.
The Company’s results of operations are exposed to foreign currency exchange risk related to intercompany loan and operating balances between subsidiaries that are denominated in currencies other than the U.S. dollar, primarily the euro and Korean won. A transaction made in a currency that differs from the local entity’s functional currency is first remeasured at the entity’s functional currency.
The Company’s results of operations are exposed to foreign currency exchange risk related to intercompany loan and operating balances between subsidiaries that are denominated in currencies other than the U.S. dollar, primarily the euro and the Korean won. A transaction made in a currency that differs from the local entity’s functional currency is first remeasured at the entity’s functional currency.
A hypothetical 100 basis point change in interest rates affecting the Company’s cash and cash equivalents would not have a material impact on the Company’s financial statements. Notwithstanding the Company’s efforts to manage interest rate risk, there can be no assurances that the Company will be adequately protected against the risks associated with interest rate fluctuations.
A hypothetical 89 100 basis point change in interest rates affecting the Company’s cash and cash equivalents would not have a material impact on the Company’s financial statements. Notwithstanding the Company’s efforts to manage interest rate risk, there can be no assurances that the Company will be adequately protected against the risks associated with interest rate fluctuations.
The remeasurement process required by GAAP for such intercompany loan and operating balances will give rise to foreign exchange gains (losses), which could materially impact the Company’s results of operations. 92
The remeasurement process required by GAAP for such intercompany loan and operating balances will give rise to foreign exchange gains (losses), which could materially impact the Company’s results of operations.
Assuming a hypothetical change of 10% in the average foreign currency exchange rate for the year ended December 31, 2024, the effect on operating income would not be material. The Company is also subject to foreign currency exchange rate risk associated with the translation of local currencies of its foreign subsidiaries into U.S. dollars.
Assuming a hypothetical change of 10% in the average foreign currency exchange rate for the year ended December 31, 2025, the effect on operating income would not be material. The Company is also subject to foreign currency exchange rate risk associated with the translation of local currencies of its foreign subsidiaries into U.S. dollars.
During 2024, the variable interest rates applicable to both benchmark rate loans and base rate loans under the Credit Facility generally fluctuated in line with interest rate changes in the marketplace and are expected to continue fluctuating with any future Federal Reserve Board interest rate changes and future changes to the SOFR Index.
During 2025, the variable interest rates applicable to both benchmark rate loans and base rate loans under the 2025 Credit Facility generally fluctuated in line with interest rate changes in the marketplace and are expected to continue fluctuating with any future Federal Reserve Board interest rate changes and future changes to the SOFR Index.
Foreign Currency Risk With global operations, the Company has foreign currency risk related to its revenues and expenses denominated in currencies other than the U.S. dollar, primarily the euro, Japanese yen, New Taiwan dollar, Chinese renminbi, Korean won, British pound sterling, Mexican peso and Singapore dollar. Foreign currency gains (losses) are recorded in net income as transactions occur.
Foreign Currency Risk With global operations, the Company has foreign currency risk related to its revenues and expenses denominated in currencies other than the U.S. dollar, primarily the euro, the Japanese yen, the Chinese renminbi, the New Taiwan dollar, the Korean won and the British pound sterling. Foreign currency gains (losses) are recorded in net income as transactions occur.
The increased interest payments on the Company’s variable-rate debt are not material to the Company’s overall liquidity position and have not impacted, and are not expected to have an impact on, the Company’s ability to make timely payments under the Credit Facility or its other obligations.
The fluctuations on interest payments on the Company’s variable-rate debt are not material to the Company’s overall liquidity position and have not impacted, and are not expected to have an impact on, the Company’s ability to make timely payments under the 2025 Credit Facility or its other obligations.
In October 2023, the Company issued $300 million in aggregate principal amount of 6.500% senior notes due 2028, which contributed to the increase of the Company’s interest expense in 2023 and 2024. The notes carry a fixed interest rate (coupon rate) and as such, are not exposed to interest rates fluctuations risk until their expected maturity in 2028.
The Company also issued $300 million in aggregate principal amount of 6.500% senior notes in October 2023, which are due 2028. The notes carry a fixed interest rate (coupon rate) and as such, are not exposed to interest rate fluctuations risk until their expected maturity in 2028.
The Company is also exposed to interest rate risk associated with its cash and cash equivalents balances. The Company does not currently use derivative financial instruments in its investment portfolio.
Because the Company’s borrowings bear interest at a variable rate, the Company is exposed to market risks relating to changes in interest rates. The Company is also exposed to interest rate risk associated with its cash and cash equivalents balances. The Company does not currently use derivative financial instruments in its investment portfolio.
Interest Rate Risk The Company’s operating results are subject to risk from interest rate fluctuations on its Credit Facility, which carries variable interest rates. Because the Company’s borrowings bear interest at a variable rate, the Company is exposed to market 91 risks relating to changes in interest rates.
Interest Rate Risk The Company’s operating results are subject to risk from interest rate fluctuations on its credit facility, which carries variable interest rates. Borrowings under the 2025 Credit Facility bear interest at a rate per annum equal to, at the applicable Borrower’s option, (a) a specified benchmark rate for the applicable currency (which, in the case of U.S.
Removed
In June 2024, the Company entered into an amendment (the “First Credit Facility Amendment”) to the Credit Facility with Bank of America, N.A. and certain other lenders.
Added
Dollar loans, shall be the Term SOFR (as defined in the Credit Agreement)), plus a margin that ranges from 0.875% to 1.375% per annum or (b) for U.S.
Removed
The First Credit Facility Amendment provided, among other things, for (i) the replacement of BSBY with Term SOFR plus a SOFR adjustment of 0.10% as a benchmark rate for interest periods commencing subsequent to June 28, 2024; (ii) UL Solutions Inc., which was previously the guarantor of the facility, became the named borrower, and UL LLC, which was previously the named borrower, became the guarantor.
Added
Dollar loans made to the Company only, a base rate (which is equal to the highest of (i) the Bank of America prime rate, (ii) the U.S. federal funds rate plus 0.5% per annum, or (iii) the Term SOFR rate plus 1.0%) plus a margin that ranges from 0.0% to 0.375% per annum.
Removed
The interest rate for the Company’s term loan as of December 31, 2024 was 5.58% , which was a floating rate based on the Term SOFR plus a SOFR adjustment plus a margin .