การประชุมแถลงผลประกอบการไตรมาส 3 ปี 2026 ของ UL Solutions (ULS): การเติบโตจากภายในแตะระดับ 7%

ประเด็นสำคัญ

• UL Solutions รายงานรายได้ไตรมาสที่ 3 ปี 2026 ที่ระดับ 823 ล้านดอลลาร์ เพิ่มขึ้น 5.1% เมื่อเทียบรายปี ขณะที่การเติบโตของรายได้แบบออร์แกนิกเร่งตัวขึ้นสู่ระดับ 7.0% ซึ่งเป็นระดับสูงสุดในรอบ 6 ไตรมาส
• EBITDA ปรับปรุงแล้วเพิ่มขึ้น 8.3% ทำสถิติสูงสุดรายไตรมาสที่ 235 ล้านดอลลาร์ ด้านอัตรากำไร EBITDA ปรับปรุงแล้วขยายตัว 90 basis points สู่ระดับสถิติสูงสุดที่ 28.6% โดยได้รับแรงหนุนจากประสิทธิภาพการทำงาน การกำหนดราคา และการปรับปรุงประสิทธิภาพการดำเนินธุรกิจ
• กลุ่มธุรกิจอุตสาหกรรม (Industrial) ยังคงเป็นตัวขับเคลื่อนหลักของการเติบโตและอัตรากำไร รายได้เพิ่มขึ้น 8.2% สู่ระดับ 410 ล้านดอลลาร์ โดยมีการเติบโตแบบออร์แกนิกถึง 8.4% และอัตรากำไร EBITDA ปรับปรุงแล้วขยายตัว 150 basis points สู่ระดับ 36.1%
• รายได้จากการทดสอบเพื่อรับรองมาตรฐานเพิ่มขึ้นเกือบ 11% โดยปริมาณงานเป็นปัจจัยขับเคลื่อนหลักของการเติบโต ผู้บริหารระบุว่าอุปสงค์มีความเชื่อมโยงกับนวัตกรรมของลูกค้าในด้านศูนย์ข้อมูล AI พลังงานและระบบอัตโนมัติ วัสดุ เทคโนโลยีคอนซูเมอร์ และระบบระบายความร้อน
• ผู้บริหารได้ปรับเพิ่มแนวโน้มการเติบโตของรายได้แบบออร์แกนิกตามอัตราแลกเปลี่ยนคงที่สำหรับปี 2026 ทั้งปีขึ้นเป็นประมาณ 6.5% ซึ่งรวมถึงผลกระทบเชิงลบประมาณ 70 basis points จากการยกเลิกธุรกิจตามแผนที่วางไว้ ทั้งนี้ คาดว่าอัตรากำไร EBITDA ปรับปรุงแล้วจะอยู่ที่ประมาณ 27.0%
• กระแสเงินสดจากการดำเนินงานรอบ 12 เดือนย้อนหลังเพิ่มขึ้น 25.9% สู่ระดับ 738 ล้านดอลลาร์ ขณะที่กระแสเงินสดอิสระเพิ่มขึ้น 23.7% สู่ระดับ 481 ล้านดอลลาร์

ข้อมูลทางการเงินที่สำคัญ

ในช่วง 9 เดือนแรกของปี 2026 รายได้แบบออร์แกนิกเพิ่มขึ้น 6.4% รายได้รวมเพิ่มขึ้น 5.9% และอัตรากำไร EBITDA ปรับปรุงแล้วขยายตัว 180 basis points สู่ระดับ 27.2% ทั้งนี้ รวมต้นทุนการทำธุรกรรมจากการควบรวมกิจการและการถอนการลงทุนเพิ่มเติมประมาณ 11 ล้านดอลลาร์เมื่อเทียบกับช่วงเดียวกันของปีก่อน ซึ่งคิดเป็นผลกระทบต่ออัตรากำไรประมาณ 40 basis points

ผลการดำเนินงานทางธุรกิจและการปฏิบัติการ

กลุ่มธุรกิจอุตสาหกรรม (Industrial)

รายได้จากกลุ่มธุรกิจอุตสาหกรรมเพิ่มขึ้น 8.2% สู่ระดับ 410 ล้านดอลลาร์ ซึ่งรวมถึงการเติบโตแบบออร์แกนิก 8.4% หากไม่รวมบริการให้คำปรึกษา รายได้แบบออร์แกนิกเพิ่มขึ้นประมาณ 9% นำโดยกลุ่มพลังงานและระบบอัตโนมัติ วัสดุ การทดสอบเพื่อรับรองมาตรฐาน และบริการการรับรองมาตรฐานอย่างต่อเนื่อง

EBITDA ปรับปรุงแล้วเพิ่มขึ้น 13% สู่ระดับ 148 ล้านดอลลาร์ ขณะที่อัตรากำไร EBITDA ปรับปรุงแล้วแตะระดับ 36.1% เพิ่มขึ้น 150 basis points ด้านอัตรากำไรจากการดำเนินงานปรับตัวดีขึ้น 50 basis points สู่ระดับ 29.3% สะท้อนถึงการเติบโตของกำไรที่เร่งขึ้นตามรายได้ (Operating Leverage) และประสิทธิภาพการทำงานของพนักงานที่สูงขึ้น

ผู้บริหารกล่าวว่าอุปสงค์ในกลุ่มธุรกิจอุตสาหกรรมมีการกระจายตัวในวงกว้าง ทั้งในกลุ่มพลังงานและระบบอัตโนมัติ สายไฟฟ้าและเคเบิล และความปลอดภัยจากอัคคีภัย โดยมีความแข็งแกร่งในสหรัฐอเมริกาและเกรตเตอร์ไชนา (Greater China) ขณะที่บริการให้คำปรึกษายังคงได้รับแรงกดดันจากปัจจัยท้าทายในธุรกิจพลังงานหมุนเวียนและอสังหาริมทรัพย์เพื่อการพาณิชย์ในสหรัฐฯ

กลุ่มธุรกิจสินค้าอุปโภคบริโภค (Consumer)

รายได้จากกลุ่มธุรกิจสินค้าอุปโภคบริโภคเพิ่มขึ้น 5.9% สู่ระดับ 360 ล้านดอลลาร์ ทั้งในรูปแบบรายงานและแบบออร์แกนิก การเติบโตได้รับแรงหนุนจากการทดสอบและบริการที่ไม่ใช่เพื่อการรับรองมาตรฐาน การทดสอบเพื่อรับรองมาตรฐาน เทคโนโลยีคอนซูเมอร์ และอุปสงค์ในภาคค้าปลีก ทั้งนี้ การยกเลิกธุรกิจตามแผนที่วางไว้ส่งผลให้การเติบโตแบบออร์แกนิก ลดลงประมาณ 150 basis points

EBITDA ปรับปรุงแล้วเพิ่มขึ้น 14.9% สู่ระดับ 77 ล้านดอลลาร์ อัตรากำไร EBITDA ปรับปรุงแล้วขยายตัว 170 basis points สู่ระดับ 21.4% ขณะที่อัตรากำไรจากการดำเนินงานปรับตัวดีขึ้น 70 basis points สู่ระดับ 12.5% โดยผู้บริหารระบุว่าเป็นผลมาจาก Operating Leverage ประสิทธิภาพการทำงาน สัดส่วนผลิตภัณฑ์ที่ดี และผลประโยชน์จากการปรับโครงสร้างองค์กร

UL Solutions ได้เสร็จสิ้นการเข้าซื้อกิจการด้านไฟฟ้าและอิเล็กทรอนิกส์ (Electrical and Electronics) ของ Eurofins เมื่อวันที่ 1 ตุลาคม ผู้บริหารคาดว่าการดำเนินงานที่เข้าซื้อจะสร้างรายได้ประมาณ 50 ล้านดอลลาร์ในไตรมาสที่ 4 การบูรณาการระบบงานหลังบ้าน (Back-office) คาดว่าจะเสร็จสมบูรณ์เป็นส่วนใหญ่ในปี 2027 โดยการประสานประโยชน์ (Synergies) ด้านการทำการตลาดและการใช้ประโยชน์จากห้องปฏิบัติการจะบรรลุผลเป็นส่วนใหญ่ภายในสิ้นปี 2028

ซอฟต์แวร์บริหารความเสี่ยงและการปฏิบัติตามกฎระเบียบ (Risk and Compliance Software)

รายได้ลดลง 17.2% สู่ระดับ 53 ล้านดอลลาร์ เนื่องจากมีการถอนการลงทุนในธุรกิจซอฟต์แวร์ด้านสุขภาพและความปลอดภัยของพนักงานเมื่อวันที่ 1 เมษายน หากไม่รวมผลกระทบดังกล่าว รายได้แบบออร์แกนิกเติบโต 4.7% โดยได้รับแรงหนุนจากอุปสงค์ด้านข้อมูลเชิงลึกในห่วงโซ่อุปทานค้าปลีก

EBITDA ปรับปรุงแล้วลดลงสู่ระดับ 10 ล้านดอลลาร์ จาก 19 ล้านดอลลาร์ และอัตรากำไรลดลงสู่ระดับ 18.9% จาก 29.7% การลดลงดังกล่าวสะท้อนถึงผลกระทบ 10 ล้านดอลลาร์จากการถอนการลงทุน ผลกระทบเชิงลบจาก Operating Leverage และต้นทุนการทำธุรกรรม ผู้บริหารคาดว่าอัตรากำไรจะปรับตัวดีขึ้นในไตรมาสที่ 4 และจะกลับเข้าสู่ช่วงการเติบโตและ EBITDA ที่เป็นปกติมากขึ้นในเวลาต่อมา

อุปสงค์ด้านการรับรองมาตรฐานและศูนย์ข้อมูล AI

รายได้จากการทดสอบเพื่อรับรองมาตรฐานเพิ่มขึ้นเกือบ 11% ขณะที่บริการการรับรองมาตรฐานอย่างต่อเนื่องเติบโตมากกว่า 7% โดยประมาณหนึ่งในสามของรายได้บริษัทมาจากบริการการรับรองมาตรฐานอย่างต่อเนื่องที่มีลักษณะเป็นรายได้ประจำตามสัญญา

ในระหว่างไตรมาส UL Solutions ได้เปิดตัวโครงการรับรองมาตรฐาน 3 โครงการ ซึ่งครอบคลุมระบบการกระจายกำลังไฟฟ้า การแปลงกำลังไฟฟ้า และการระบายความร้อนด้วยของเหลวสำหรับระบบนิเวศศูนย์ข้อมูล AI นอกจากนี้ ยังได้ขยายศูนย์ความเป็นเลิศด้าน HVAC ในเมืองเพลโน รัฐเท็กซัส เพื่อทดสอบเทคโนโลยีการระบายความร้อนขั้นสูง

ผู้บริหารเปิดเผยว่า การอัปเกรดอุปกรณ์อย่างต่อเนื่อง ข้อกำหนดด้านความร้อนที่เปลี่ยนแปลงไป และความต้องการพลังงานที่สูงขึ้น จะช่วยสนับสนุนรอบการรับรองมาตรฐานผลิตภัณฑ์อย่างต่อเนื่อง และขยายฐานบริการการรับรองมาตรฐานที่มีรายได้ประจำ

แนวโน้มและประมาณการโดยผู้บริหาร

UL Solutions ได้ปรับเพิ่มแนวโน้มการเติบโตของรายได้แบบออร์แกนิกตามอัตราแลกเปลี่ยนคงที่สำหรับปี 2026 ทั้งปีขึ้นเป็นประมาณ 6.5% ประมาณการนี้รวมผลกระทบเชิงลบคาดการณ์ 70 basis points จากการยกเลิกธุรกิจที่เกี่ยวข้องกับการปรับโครงสร้าง ซึ่งต่ำกว่าประมาณการเดิมของบริษัทที่ระดับประมาณ 100 basis points

ผู้บริหารคาดการณ์ว่า:

• อัตรากำไร EBITDA ปรับปรุงแล้วตลอดทั้งปีจะอยู่ที่ประมาณ 27.0%
• อัตรากำไรพื้นฐานจะขยายตัวประมาณ 200 basis points ซึ่งถูกหักล้างบางส่วนด้วยต้นทุนการทำธุรกรรมเพิ่มเติมประมาณ 90 basis points เมื่อเทียบกับปี 2025
• ต้นทุนการทำธุรกรรมและการบูรณาการตลอดทั้งปีจะอยู่ที่ประมาณ 37 ล้านถึง 40 ล้านดอลลาร์ ซึ่งคิดเป็นผลกระทบต่ออัตรากำไรประมาณ 120 basis points
• อัตราภาษีที่แท้จริงตลอดทั้งปีจะอยู่ที่ประมาณ 26%
• รายจ่ายลงทุน (Capital Expenditures) จะอยู่ที่ประมาณ 8.5% ของรายได้ โดยเน้นไปที่การลงทุนเพื่อการเติบโตเป็นหลัก
• รายได้ไตรมาสที่ 4 จากธุรกิจ E&E ที่เข้าซื้อจะอยู่ที่ประมาณ 50 ล้านดอลลาร์

ผู้บริหารระบุว่าอุปสงค์ยังคงแข็งแกร่งเมื่อพิจารณาจากกิจกรรมในช่วงต้นไตรมาสที่ 4 พร้อมย้ำว่าสภาวะเศรษฐกิจมหภาคยังคงมีความผันผวนและเปลี่ยนแปลงอยู่เสมอ

ความเสี่ยงและประเด็นที่ต้องจับตา

• ต้นทุนการบูรณาการธุรกิจ E&E ในไตรมาสที่ 4 คาดว่าจะสูงกว่าที่ผู้บริหารประเมินไว้ในช่วงต้นปี และบริษัทคาดว่าประมาณการต้นทุนการทำธุรกรรมและการบูรณาการยังคงมีช่วงกรอบความคลาดเคลื่อนอยู่
• กลุ่มซอฟต์แวร์บริหารความเสี่ยงและการปฏิบัติตามกฎระเบียบ รายงานความสามารถในการทำกำไรที่อ่อนตัวลง เนื่องจากการถอนการลงทุนในธุรกิจ EHS ฐานรายได้ที่เล็กลง และต้นทุนการทำธุรกรรม
• สภาวะในอุตสาหกรรมพลังงานหมุนเวียนและอสังหาริมทรัพย์เพื่อการพาณิชย์ในสหรัฐฯ ยังคงกดดันธุรกิจให้คำปรึกษาซึ่งมีขนาดเล็กกว่า
• การยกเลิกธุรกิจ Consumer ตามแผนที่วางไว้ยังคงเป็นปัจจัยกดดันรายได้ แม้ว่าการรักษาฐานลูกค้าและการย้ายสถานที่ปฏิบัติงานจะช่วยลดผลกระทบที่คาดการณ์ไว้ตลอดทั้งปีลงได้บ้าง
• ข้อห้ามของ FCC ไม่ให้ห้องปฏิบัติการในจีนทำการทดสอบอุปกรณ์อิเล็กทรอนิกส์เพื่อขออนุมัติเข้าสู่ตลาดสหรัฐฯ อาจส่งผลกระทบต่อกิจกรรมในกลุ่ม Consumer เพียงส่วนน้อย ผู้บริหารคาดว่าจะไม่ส่งผลกระทบอย่างมีนัยสำคัญ และมีแผนที่จะเปลี่ยนเส้นทางการทดสอบไปยังเครือข่ายห้องปฏิบัติการที่ได้รับการรับรองทั่วโลกหากจำเป็น

สรุปประเด็นสำคัญช่วงถาม-ตอบกับนักวิเคราะห์

• ราคาเทียบกับปริมาณ: ทั้งสองปัจจัยมีส่วนช่วยในการเติบโตของไตรมาสที่ 3 แต่ปัจจัยด้านปริมาณมีส่วนช่วยมากกว่าเล็กน้อย การเติบโตในระดับสองหลักของการทดสอบเพื่อรับรองมาตรฐานมีปัจจัยขับเคลื่อนหลักมาจากปริมาณงาน
• แรงส่งของศูนย์ข้อมูล: ผู้บริหารระบุว่าการทดสอบเพื่อรับรองมาตรฐานเป็นตัวบ่งชี้อุปสงค์ของศูนย์ข้อมูล AI ที่ชัดเจนที่สุด การปรับเปลี่ยนการออกแบบผลิตภัณฑ์ที่เกี่ยวข้องกับพลังงาน เซิร์ฟเวอร์ ชิปเซ็ต และระบบระบายความร้อน อาจสร้างความต้องการในการทดสอบซ้ำอย่างต่อเนื่อง
• การขยายตัวของอัตรากำไร: โอกาสในอนาคตรวมถึงประสิทธิภาพการทำงานของพนักงานที่สูงขึ้น การใช้ประโยชน์จากห้องปฏิบัติการที่ดีขึ้น AI และระบบอัตโนมัติ การปรับปรุงราคา และการปรับปรุงประสิทธิภาพพอร์ตโฟลิโออย่างต่อเนื่อง
• การเข้าซื้อกิจการ E&E: ผู้บริหารมองเห็นโอกาสทั้งด้านรายได้และต้นทุน รวมถึงการขายเกื้อกูลกัน (Cross-selling) การขยายพื้นที่ให้บริการครอบคลุมมากขึ้น การเพิ่มการใช้ประโยชน์จากห้องปฏิบัติการ และการประยุกต์ใช้โมเดลการดำเนินงานของ UL Solutions
• ความชัดเจนของรายได้: รายได้หนึ่งในสามมาจากบริการการรับรองมาตรฐานอย่างต่อเนื่องที่มีลักษณะเป็นรายได้ประจำ การทดสอบเพื่อรับรองมาตรฐานโดยทั่วไปยังมีระยะเวลาโครงการยาวนานกว่าการทดสอบที่ไม่ใช่เพื่อการรับรองมาตรฐาน ขณะที่ผู้บริหารระบุว่ายอดคำสั่งซื้อในธุรกิจเกี่ยวกับการเปลี่ยนผ่านด้านพลังงาน การใช้ระบบไฟฟ้า และวัสดุ เติบโตเร็วกว่ารายได้
• โครงการเพิ่มประสิทธิภาพ: บริษัทได้ดำเนินการปรับเปลี่ยนจำนวนพนักงานตามแผนเสร็จสิ้นส่วนใหญ่แล้ว และคาดว่าโครงการจะเสร็จสมบูรณ์ภายในสิ้นไตรมาสแรกของปี 2027 ผู้บริหารระบุว่าผลประโยชน์ส่วนใหญ่ที่คาดการณ์ไว้บรรลุผลแล้ว

บทถอดความการแถลงผลประกอบการฉบับเต็ม

บทถอดเสียงฉบับเต็มของการประชุมทางโทรศัพท์ผลประกอบการ

คำชี้แจงจากฝ่ายบริหาร

Operator

Hello, and welcome to the UL Solutions Third Quarter 2026 Earnings Conference Call. [Operator Instructions]. As a reminder, this conference is being recorded. I would now like to turn the call over to your host, Ms. Yijing Brentano, Vice President of Investor Relations at UL Solutions. Thank you. You may begin, Ms. Brentano.

Yijing Brentano

Thank you, and welcome, everyone, to our third quarter 2026 earnings call. Joining me today are Jenny Scalene, our Chief Executive Officer; and Ryan Robinson, our Chief Financial Officer. During our discussion today, we will be referring to our earnings presentation, which is available on the Investor Relations section of our website at ul.com. Our earnings release is also available on the website. I would like to remind everyone that on today's call, we may discuss forward-looking statements within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements may include, among other things, statements about UL Solutions results of operations and estimates and prospects that involve substantial risks, uncertainties and other factors that could cause actual results to differ in a material way from those expressed or implied in the forward-looking statements.

Please see the disclosure statement on Slide 2 of the earnings presentation as well as the disclaimers in our earnings release concerning forward-looking statements and the risk factors that are described in our annual report on Form 10-K for the year ended December 31, 2025, and subsequent SEC filings. We undertake no obligation to update any forward-looking statements to reflect events or circumstances after the date hereof, except as required by law. Today's presentation also includes references to non-GAAP financial measures. A reconciliation to the most comparable GAAP financial measures can be found in the appendix to the earnings presentation, which is posted on the Investor Relations section of our website at ul.com. With that, I would like to turn the call over to Jenny.

Jennifer Scanlon

Good morning, everyone, and thanks for joining us. We had another strong quarter, reflecting broad-based growth and continued operating momentum across the business. Organic revenue growth accelerated to 7%, the highest level in 6 quarters. continuing our growth trajectory since our IPO. Adjusted EBITDA margin expanded 90 basis points to a quarterly record of 28.6%, driven by ongoing productivity improvements, pricing initiatives and business optimization. Since becoming a public company, we've expanded adjusted EBITDA margin by roughly 500 basis points, and we expect our performance to further improve. It's a great story, a growth story.

Our resilience and ability to convert revenue growth into higher profitability and cash flow in the face of changing macroeconomic environments globally has been well demonstrated as AI and data centers advance and consume investment by hyperscalers, co-locators and every type of industry, our long-term customers are turning to us as safety science experts to ensure the products and ecosystems being developed are trusted. That is the case both for the end consumer served by our customers and in large industrial applications. Today, our safety science matters for AI and accelerating product development, market access and adoption, just as it proved essential in other technology revolutions of the last century.

We work with more than 60% of the Fortune 500. The drivers of our strong third quarter performance include double-digit growth in certification testing, strength in materials, energy and automation and consumer technology, along with measurable productivity improvements. As products like appliances and medical devices and assets like large power and automation systems become more interconnected, our services and technical expertise provide customers with a solid foundation for ongoing innovation, reliability and trust backed by over 130 years of experience. Our sustained robust cash flow and investment-grade balance sheet put us in a great position to selectively and strategically invest in new capabilities across our industrial, consumer and risk and compliance software segments.

As manufacturers face the need for greater trust sought by their end users and products, ecosystems and supply chains, our disciplined portfolio management supports the pursuit of attractive growth opportunities. Today, I will focus on 3 themes: the enduring strength of our underlying business, the continued improvement in our operating performance and the strategic investments supporting our long-term value creation. Starting with our TIC business. Both the industrial and consumer segments reported strong organic growth and record quarterly adjusted EBITDA margins. Industrial remains our primary growth and margin engine as organic revenue increased 8.4%, and adjusted EBITDA margin expanded 150 basis points to a quarterly record of 36.1%.

Consumer continued to perform well, achieving 5.9% organic revenue growth despite an approximately 150 basis point headwind from planned business exits. Consumer adjusted EBITDA margin expanded 170 basis points to a quarterly record of 21.4% reflecting a more focused operating model. In Risk and compliance software, our focus remains on supporting our manufacturing customers and their supply chains and their growing need for essential regulatory data and compliance insights. At the same time, we are aligning the cost structure with the reshaped focused portfolio.

Importantly, our consolidated growth continues to be boosted by demand for our certification services required to bring new innovation safely to global markets. Certification testing revenue increased nearly 11%, while ongoing certification services grew over 7%. Together, these services are the fuel for our strong base of recurring revenue in our TIC business. Beyond our current performance, we continue to invest in organic opportunities that extend our value proposition, expand our participation in attractive markets and leverage our existing infrastructure to generate profitable growth.

As I mentioned earlier, the AI data center ecosystem is a particularly attractive area. During the quarter, we launched 3 certification programs supporting the next generation of the AI data center ecosystem addressing power distribution, power conversion and liquid cooling. We also expanded our HVAC Center of Excellence in Plano, Texas to support testing for advanced cooling technologies. These types of investments are intended to extend our capabilities in emerging technologies and support customers as new markets and technologies develop, which have led to our double-digit certification testing growth.

During the quarter, we also expanded our retail sector testing capabilities in Europe and the United States, broadening our service offerings and leveraging existing facilities to support incremental growth in non-certification testing. These investments address increasing customer demand for comprehensive testing services while also improving our productivity. Across these initiatives, our strategy remains consistent, investing capabilities where we have differentiated expertise, expand our participation in attractive markets and leverage our existing infrastructure to generate profitable growth. I'm proud that in 2026, we also actively reshaped our portfolio to solidify our position as a leader in product tech services and focused our capabilities in risk and compliance software on customers' expanding needs for supply chain insights and compliance.

In TIC, we exited businesses as part of an overall restructuring plan and acquired Eurofins Electrical and Electronics business, adding substantial capacity and expertise to our core business. In Risk and Compliance software, we sold our employee health and safety software business in April as it had diminishing strategic value. In July, we bolstered our capabilities by acquiring Avenia Consulting Firm, Inc., a thought leader and extended producer responsibility, known as EPR, management and environmental compliance services. EPR is a policy approach in which customers are made responsible for the entire lifespan of their products, especially what happens after consumers throw them away. These portfolio moves aligned with our strategy of building Ultrus as an AI-first product and supply chain compliance and intelligence platform.

On October 1, we completed the acquisition of Eurofins E&E business, a highly complementary asset that expands our consumer segment by creating opportunities to leverage our combined capabilities, accreditations and laboratory networks. We intend to broaden customer relationships, increase laboratory utilization and cross-sell our fulsome set of services to new customers and new markets. Over the last few weeks, I visited some of our new E&E colleagues in Europe, the U.S. and in Asia. Universally, I heard excitement about them joining a global leader in product tick and the opportunities ahead to expand their reach and effectiveness. We are excited to continue with the integration process and expect back-office integration to be substantially complete in 2027 with go-to-market and lab utilization synergies largely realized by the end of 2028.

And just last week, we completed the sale of our stake in DQS for approximately $117 million. Together, these activities advance our strategy of pursuing acquisitions and portfolio refinements that enhance our ability to serve product manufacturers as they expand investments into their next generation of product innovations. As CEO, 1 of the most important decisions I make is how we best deploy capital to meet our customers' needs and to generate high return on invested capital for our shareholders. As such, our approach to capital allocation remains disciplined. We will continue to evaluate opportunities to expand our capabilities and geographic reach while applying rigorous strategic and financial criteria to our investments.

Now turning to the demand environment. We believe demand remains healthy across our businesses based on what we've seen so far in the fourth quarter. We expect to continue to benefit from increasing product complexity, evolving safety requirements and the need for independent testing and certifications as customers introduce new innovations. The breadth of our customer base, the recurring nature of ongoing certification services and our exposure to long-term growth trends support the resilience of our business. Looking ahead, we are confident in our ability to build on our momentum through strategic investments and continued improvements in operating discipline. Now I'll turn the call over to Ryan for a detailed review of our third quarter results and our updated full year 2026 outlook.

Ryan Robinson

Thank you, Jenny, and hello, everyone. I also want to thank our team members around the world for another excellent quarter of execution. Let me walk through the quarter in detail. Consolidated revenue of $823 million was up 5.1% over the prior year quarter, including organic revenue growth of 7% and -- adjusted EBITDA was a quarterly record of $235 million, an improvement of 8.3% year-over-year, with adjusted EBITDA margin expanding 90 basis points to a quarterly record of 28.6%. Net income was $117 million, up 10.4% year-over-year with net income margin of 14.2%, up 70 basis points. Diluted earnings per share were $0.53, up from $0.49 in the third quarter of 2025. Adjusted net income was $135 million, up 13.4% from the third quarter of 2025 with adjusted net income margin of 16.4% and up 120 basis points. Adjusted diluted earnings per share was $0.62, up 10.7% from the prior year period.

For the 9 months ended September 30, 2026, organic revenue growth was 6.4% and with total revenue growth of 5.9% and adjusted EBITDA margin expanded 180 basis points to 27.2%. Importantly, this margin expansion includes the impact of acquisition and divestiture transaction costs, which were approximately $11 million higher than the prior year period. representing an impact of roughly 40 basis points to both operating income and adjusted EBITDA margin. we have provided some additional detail on Page 23 of the presentation posted to our Investor Relations website. Now let me turn to our performance by segment, starting with Industrial. Revenues in industrial rose 8.2% to $410 million or 8.4% organically. Excluding advisory services, Industrial organic revenue grew approximately 9% and Growth was led by strength in energy and automation and in materials with continued momentum in ongoing certification services and certification testing.

Adjusted EBITDA in Industrial increased 13% to a quarterly record of $148 million, with adjusted EBITDA margin expanding 150 basis points to a record 36.1%. Operating margin improved 50 basis points to 29.3%, reflecting operating leverage and higher employee productivity. Turning to the Consumer segment. Revenues were $360 million, up 5.9%, both in total and on an organic basis, driven by strength in non-certification testing and services and certification testing. -- with higher demand in consumer technology and in retail. This organic growth was despite an approximately 150 basis point reduction from the previously announced business exits under our restructuring plan. Adjusted EBITDA for Consumer was $77 million, an increase of 14.9% versus the third quarter of last year. with adjusted EBITDA margin expanding 170 basis points to a record 21.4%. Operating margin improved 70 basis points to 12.5%. The improvement reflects operating leverage, higher employee productivity, favorable mix and the continued benefit of our restructuring actions.

In our Risk and Compliance Software segment, revenues were $53 million, a decrease of 17.2% year-over-year, reflecting the divestiture of our EHS software business, which closed on April 1, excluding that impact, the segment grew 4.7% organically, driven by increased demand for supply chain insights in the retail industry. Adjusted EBITDA for risk and compliance software was $10 million compared to $19 million in the third quarter of 2025, which was a strong quarter of revenue growth and profitability.

Adjusted EBITDA includes a $10 million reduction from the EHS divestiture, negative operating leverage from a smaller revenue base and some transaction costs. Adjusted EBITDA margin was 18.9% compared to 29.7% in the prior year quarter. Now turning to cash flow and the balance sheet. For the trailing 12 months ended September 30, 2026, we generated $738 million of cash from operating activities up 25.9% and $481 million of free cash flow, up 23.7% year-over-year. We ended the quarter with total debt of $766 million, and we continue to maintain a strong investment-grade balance sheet, which provided the flexibility to fund the E&E acquisition alongside our other capital priorities.

Subsequent to quarter end, we also sold our stake in DTS for approximately $117 million and we expect to record a pretax gain of approximately $93 million in the fourth quarter within other income outside of operating income, and it will be excluded from our adjusted measures. As of October 30, 2026, after the close of the E&E transaction and the sale of the DQS stake, our total debt was $689 million. We paid a quarterly dividend of $0.145 per share or $29 million during the third quarter, consistent with the increased dividend we announced at the start of the quarter. Our strong cash generation and disciplined balance sheet have positioned us to invest with confidence.

We invested approximately $891 million in 2026 and to grow and to become more efficient, including $692 million of strategic acquisitions, which include the E&E acquisition and $199 million of capital investments while returning $88 million to shareholders through dividends. We also unlocked approximately $318 million in value from nonstrategic assets. Importantly, we have maintained the financial flexibility to pursue additional growth opportunities, both organically and through strategic acquisitions.

Now turning to our full year 2026 outlook. The macro environment remains dynamic, but demand has remained resilient and our execution has been strong. Based on our strong performance through the first 9 months, we're strengthening our full year 2026 constant currency organic revenue growth to approximately 6.5% inclusive of approximately 70 basis points of revenue reduction from business exits associated with our restructuring plan. When we announced the restructuring plan, we had estimated the revenue impact would be approximately 1%. However, we've been able to retain customers and relocate work to other locations.

For full year adjusted EBITDA margin, we expect improvement to approximately 27.0% driven by approximately 200 basis points of underlying margin expansion partially offset by approximately 90 basis points of incremental transaction costs versus 2025. Included in our outlook is E&E's expected approximately $50 million of fourth quarter revenue and margin performance in line with our expectations. As Jenny mentioned, we have begun our integration activities and expect to complete back office integration by the end of 2027. As detailed on the last page of our earnings presentation, transaction and integration costs are expected to total approximately $37 million to $40 million for the full year of 2026, representing approximately 120 basis points for the full year. That compares with approximately 30 basis points impact in 2025. We expect our full year effective tax rate to be approximately 26% and full year capital expenditures of approximately 8.5% of revenue. Primarily geared towards high-return growth investments. We remain focused on continuing to pursue acquisitions and portfolio refinements consistent with our capital allocation strategy.

Overall, our year-to-date results demonstrate consistent profitable growth, continued margin expansion and disciplined capital deployment. We're pleased with the completion of the E&E acquisition and the DQS sale, and we believe our strong cash generation and investment-grade balance sheet provide the flexibility to invest in future capabilities while pursuing attractive growth opportunities. We remain well positioned to achieve our full year objectives and create durable long-term value. Now let me turn the call back to Jenny for her closing remarks.

Jennifer Scanlon

Thanks, Ryan. Over the past few weeks, members of our leadership team and I hosted more than 300 industry leaders in Chicago and Asia. At events in Chicago, Taipei and Nanjing, China, we brought together customers and external experts to discuss market trends, evolving technology and the trust challenges shaping the future. A highlight of these events was the opportunity to commemorate some of our longest-standing customer relationships. We recognized Honeywell technologies, Eaton and Schneider Electric for their 100-plus year collaboration with us and celebrated 35 additional customers for 50-plus years of engagement. This is truly remarkable.

We are so grateful for these enduring relationships and the opportunity to foster exchange of the deep expertise needed to pave the way for safer trusted innovation around the world. In closing, our third quarter performance reinforces the durability of our growth, the strength of our operating model and the value of our disciplined investment strategy. We entered the final quarter of 2026 with strong momentum and remain focused on delivering sustainable value for our customers, employees and shareholders. Thank you to our teams around the world for your dedication to our mission of working for a safer world. With that, we'll open the line for questions.

Operator

[Operator Instructions] The first question is from Andrew Nicholas from William Blair.

ช่วงถาม-ตอบ

Andrew Nicholas

I appreciate you taking my questions. First wanted to talk about third quarter results and hoping you could speak to the split between price and volume across your major revenue categories?

Jennifer Scanlon

Absolutely. And I'll turn it over to Ryan to go into the details on that, but we are pleased that we saw growth across all of our businesses and all over the world.

Ryan Robinson

We're pleased with our revenue growth and we had contributions from both price and volume. In the third quarter, we had slightly higher contribution from volume and then within certification testing, in particular that you saw had strong double-digit growth, more of that contribution was from volume.

Andrew Nicholas

Very helpful. And then for my second question, I wanted to ask, I think -- the FCC recently voted to prohibit Chinese labs from testing electronic devices for U.S. market authorization. I was hoping you could kind of walk through the puts and takes there, how it would potentially impact UL, whether it's positive or negative?

Jennifer Scanlon

Yes. Absolutely, Andrew. And we do not expect a material impact from this announcement. We do perform a broad range of services in China. And as you know, last year was -- China was 25% of our revenue. And this piece, this announcement would affect a small percentage of that largely in our consumer segment. But the great news about our business and the way that we run it is that we have a global network of accredited labs that lets us work with our customers to adjust where we test their products. And of course, we will test in accordance with the rules. So we'll be working with our customers. We'll minimize the disruption to them. and we'll rely upon our global lab network as we continue to see these rules evolve.

Operator

The next question is from George Tong from Goldman Sachs. George Tong? The next question is from Andrew Steinerman from JPMorgan.

Andrew Steinerman

I would like to ask you about the momentum in UL's business as it relates to the data center industry build-out. As you go through the current quarter, the fourth quarter into next year, does that end market have the same type of pull for safety testing as it did this year?

Jennifer Scanlon

Absolutely. It's a great question, Andrew. And those customer events that we had that I cited in my opening comments, data centers and AI factories as they're frequently called is certainly the hot topic right now. I think the best place to look as to the effect of data centers on our demand and our growth is in the certification testing. And as we said, our certification testing revenue was up almost 11% year-on-year, which I think really reflects the innovations that our customers are pursuing to keep up with the ever-evolving ecosystem and demand for these new architectures. We continue to see this momentum. It's why we've announced new certifications and continue to work with our customers on outlines of investigation. And we will continue to support this very dynamic innovation environment that we're seeing.

Operator

The next question is from Josh Chan from UBS.

Unknown Analyst

Jenny Ryan Yiding. I wanted to ask about the recent lab capacity increases that you've announced. How should we think about those capacity as it aligns to your base business and how that capacity increases shaped towards 2027?

Jennifer Scanlon

Yes. Our lab investments, when we look at those organic investments, and we've had a number of announcements this year in recent openings in both industrial and consumer. And we use our organic investments to fuel growth in the areas where our customers are demonstrating that there will be durable demand and that it's an extension of either our geographic footprint or deepening our capabilities and certainly taking advantage of our recent infrastructure. I think the recent announcement of the Plano HVAC Center of Excellence is a great example of that. We have long time been a leader in cooling technologies. This footprint expands our capabilities into even larger commercial grade cooling than we had previously had in the past draws upon a location that we already had and extends the capabilities of the experts that we have. So that's how we think about CapEx and continuing to grow by our organic investments.

Unknown Analyst

Great. And then on the E&E assumption for Q4, I know, Ryan, you said $50 million of revenue, which makes sense. What level of profitability are you building in for E&E initially? And then can you talk about the sort of the path to realizing any synergies that you might be planning for the business?

Ryan Robinson

Thank you very much. So first to point out, we said our outlook was driven by 2 components: approximately 200 basis points of underlying margin expansion and the E&E contribution is part of that $200 million. So our -- the performance so far and our expectations are in line with what we had thought initially. We're excited about the opportunity. We have a clear path to integration. I think we've modified our comments to say we expect to complete back-end integration in 2027. Also, our path to go-to-market and lab efficiency, we expect to be largely complete by the end of 2028. We do expect to incur some integration costs in 2027, but that will be factored into our overall performance and outlook that we report at the end of the year.

Operator

The next question is from Stephanie Moore from Jefferies.

Stephanie Benjamin Moore

Great. Good morning. Thank you, guys. So you're on track to deliver, I guess, roughly 200 basis points of underlying margin expansion in 2026, another record year for the company. As you look into 2027 and I guess the years after, what are the biggest drivers of the next leg of margin improvement? How should we think about, I guess, continued employee productivity? You've talked about AI and automation. -- lot of strategic investments you've made in 2026, including some divestitures? Where are the biggest opportunities for the next leg of margin improvement?

Jennifer Scanlon

Yes, absolutely. Because our quest for margin expansion never ends, and our jobs are never finished here. The ongoing productivity improvements, we -- I would say that is job 1 for us. And that is both using extension of our lab capabilities, better applying AI to our processes and AI that's both available through commercial off-the-shelf technologies that we use like Salesforce and Oracle as well as internal systems that we use. So that type of continuous improvement is ongoing. We've also talked about pricing initiatives and continuation of pricing. As Ryan indicated, we saw some real strength in volume growth and applying the right pricing initiatives as we continue to see that volume growth also provides some great opportunities for expansion.

And then as we've always said, we will continue to refine and optimize our businesses. The exits in consumer this year, which were planned, were lower margin and lower growth and even as we look at risk and compliance software, the EHS that we divested earlier this year was lower growth and would have required significant future investment with probably less upside to it. So we're making those refinements to also help continue to expand our margins on an ongoing basis.

Stephanie Benjamin Moore

Very clear. And then to follow up, and this is a follow-up to a prior question on just the EE deal that's closed. As you think about just the opportunity to apply the ULS operating model across the lab and the company, should we -- where should we think about the biggest opportunities? Is this more of a cost and margin improvement story or more of a revenue opportunity story in your mind?

Jennifer Scanlon

Yes. I think it's both. But the -- the exciting opportunity about this business is, one, it does expand our geographic footprint into areas where we didn't have as many lab or engineering capabilities. So you look at the additions in Europe and even the additions in Asia, particularly in Korea, it's really helpful. E&E is aligned with many of the megatrends that have been propelling our growth and particularly as you look at our consumer technology and Connected Technologies business, and so having the opportunity to cross-sell a more fulsome set of services to those existing E&E customers is a great growth opportunity for us. But of course, we're going to run this smartly. We're going to apply the things that they do well, speed to market, a really great customer focus on a new group of customers. And the things that we do well on the ways in which we run our labs globally and expect margin expansion as well.

Operator

Appreciate it. The next question is from Seth Weber from BNP Pariba.

Seth Weber

I guess, first, just a clarification. The transaction costs for the fourth quarter that you've called out the $18 million to $21 million. Is that consistent with what was in the prior 27% EBITDA margin guide? Or is that higher relative to where you thought it was I would as of last quarter.

Ryan Robinson

Yes. Thank you for the question, Seth. As we progressed in the year, I think our expectations about transaction and integration costs and our pace have increased a bit. So -- we think we have a good handle on the work that needs to be done and the time line to do it. But we just closed the transaction less than -- roughly a month ago. And so we're in early innings. -- but overall, we're progressing well.

Seth Weber

Okay. I'm just trying to understand if -- so margins would have been a little bit higher. Your guide would have been a little bit stronger on the margin side but you had some extra costs that you feel like you're seeing here through the fourth quarter. Is that the right way to think about it?

Ryan Robinson

Yes. I think it's fair to say that our Q4 integration costs are a bit higher than what we would have thought earlier in the year before the transaction closed.

Jennifer Scanlon

Yes. And Seth, we tried to make this easy to understand the puts and takes on it. And so there is Slide 23 in the earnings presentation. And 1 of the things that you'll see on that slide in Q4 is that we even still have a range of what we're predicting on those transaction and integration costs.

Seth Weber

Right. Okay. And then just on the software business, what's the right margin to think about for that business? I mean sales were kind of flat here sequentially, but margins ticked down. Just trying to understand how we should be thinking about that business kind of holistically.

Jennifer Scanlon

Yes. Indeed, it was a disappointing margin quarter, and it's reflective of a lot of puts and takes from the effect of the EHS divestiture earlier this year. The remaining portfolio is stronger than is reflected in this quarter results. This quarter, we reported 4.7% organic revenue growth and the underlying real strength in some of the software that we have there is better than that. So that said, we expect some margin improvement in the fourth quarter, and we expect a reversion toward a more normal growth and EBITDA range as we were seeing prior to the EHS divestiture as we look beyond the fourth quarter.

Operator

The next question is from Arthur Truslove from Citi.

Arthur Truslove

Good afternoon convention strong quarter. couple of questions for me. I was just wondering, would it be possible to sort of drill down a little bit as to what's driven the acceleration of organic growth in the Industrial division. I appreciate it has accelerated. And you've mentioned kind of what's been strong. But are you able to just explain kind of why it's accelerated. Second question, are you able to talk a little bit about the visibility for revenue of the business as you look out over time. So maybe can you give an idea roughly of how much revenue can you see 3 months, 6 months, 12 months, maybe even 24 months out?

And then final question, relative to when you IPO-ed, how well developed do you think your pricing system is? And how far do you think you are through your efficiency sort of program? And how much do you think you've kind of got to go of those processes, if that makes sense?

Jennifer Scanlon

Thanks, Arthur. And we'll try to take those 1 at a time, and I'll start with the acceleration of organic growth in industrial which, indeed, as I've said, industrial is our primary growth and margin driver and the 8.4% organic revenue growth which includes the inclusion of advisory that we moved in earlier this year, and advisory was relatively flat. So again, that underlying core industrial growth is even stronger. And it is being driven by all of the mega trends. This is the core of our core of our business. We talked about the certification testing growth. Now certification testing occurs in both industrial and consumer. But in industrial, we're seeing it in power and automation, wire and cable, and fire safety.

And we're seeing that in the United States and in Greater China. So -- and then leading into your second question, kind of visibility in revenue. One of the interesting distinctions between certification testing and non-certification testing is certification testing tends to have longer duration and so as we see those orders, we do have greater visibility into how that revenue hits over time, where non-certification testing can frequently -- in the retail space, it can be in and out in 3 days. So as we look at orders and we look at orders and things like our key businesses that are driven by the energy transition, and the electrification of everything and also shifts in materials. We're seeing those orders growing faster than revenue. And so that supports our continued demand visibility. Brian, do you want to talk about just the final question on relative to the IPO, how we're doing on pricing and how we're doing on margin expansion.

Ryan Robinson

Sure. And then I would just add to your answer. But 1/3 of our revenue is ongoing certification services, which is a contractually recurring revenue stream, it provides a lot of visibility and the comments that Jenny made about testing were spot on. In regard to pricing, we continue to develop our capabilities. We've developed the infrastructure and the technical capabilities and processes for customer relationship management for our configure price quote and we have made improvements in centralized processes and governance around pricing. I would say there is still some progress to go in some of our businesses to advance value-based pricing, but we made good progress in the journey thus far, and it's contributed to the revenue growth and the margins.

And then in regard to the efficiency program that we announced in the third quarter of last year, we've made good progress. We are on track for the benefits that we had described at that time. We have achieved the majority of the headcount changes that we described, we had said that we expect that to be complete by the end of the first quarter of 2027. We feel we're on point for that. But already, we've achieved the majority of the benefits that we've anticipated.

Operator

The next question is from Shlomo Rosenbaum from Stifel.

Shlomo Rosenbaum

I want to go back to a question I was touching on earlier in terms about how broad-based Industrial's organic growth is, I know there's overlap when you talk about data center demand, there's a lot of things that go into that. The wiring goes into that. energy goes into that different other construction materials. Are you able to kind of segment out how much of the growth is really being ultimately driven by the data center demand versus demand elsewhere in the economy? Or -- is there some way to view that for us to see what is actually the key growth drivers that are kind of shining through with this strong growth?

Jennifer Scanlon

Yes. It's an important question, and it's important to remember that as our customers, those very large industrial manufacturers that we've worked with for decades, as they're responding to the demand, and I'm going to just again start with the megatrends of the energy transition and electrification of everything. That is showing up in data centers, but it's also showing up in their other markets because large-scale industrial manufacturers are focused on an energy crunch and are looking for equipment to run in their manufacturing plants that would be more energy efficient. And so a lot of the innovation that's out there, as you see in a lot of technology trends, maybe initially driven by the ideas that are being pushed by the leaders in the data center architecture, infrastructure ecosystem but then those ideas, those concepts, those innovations end up being applied for product use in other environments.

And so that's why for us, it's more important to focus on what is the effect of these megatrends on our customers' innovation cycles and we just continue to see tremendous propellants, great tailwinds from the electrification, the energy transition the need for more sustainability and the effect of digitalization across all of those new product development life cycles.

Shlomo Rosenbaum

Okay. And then maybe this is for Ryan. Just trying to understand the margin improvement in industrial and consumer. Is there a way to segment at least roughly operating leverage versus productivity versus portfolio changes for industrial and consumer. Is there a way to think about it, like 2/3 coming from 1 versus the other in order for us to understand how much is just driving the top line versus how much is actively managing the costs and where the costs are coming from.

Ryan Robinson

Yes. And we're pleased with the margin expansion in both of those segments. I would say broadly, we talk about productivity improvements and better utilization of our team members in our locations. So when we grow revenue faster than like our employee compensation costs, that is a measure of employee productivity. Operating leverage can be better utilizing our other costs, our locations, our rent, our or other costs. And we break out both of those employee compensation as well as services, materials and depreciation and amortization in our sector -- in our reporting. So we're pleased with the progress in underlying 200 basis points of margin expansion year-over-year, and we hope the incremental information we provided is helpful to all of our investors.

Operator

The next question is from George Tong from Goldman Sachs.

Keen Fai Tong

And apologies for the technical difficulties earlier. Industrial organic growth was around 9% excluding advisory compared to 8.4%, including advisory. Can you talk a little bit more about performance within advisory and whether the slower growth reflected project timing, softer demand or -- any other factors? And how you're thinking about advisory growth heading into 2027?

Jennifer Scanlon

Yes. Advisory is important because it helps us provide a fulsome set of solutions for many of our customers, in particular, in the renewable energy space and in the built environment and the commercial real estate. There have been headwinds in both of those industries and advisory has had challenges, in particular in the United States in both of those industries. Outside of that, in particular, when you look at like Germany or Europe, advisory is stronger and seeing some interesting projects and opportunities for growth. So it's a small business. It's got a lot of puts and takes. -- timings of projects can affect growth rates that are reported. But indeed, right now, there continues to be some headwinds both from renewable energy here in the United States and the commercial real estate effect here in the United States.

Keen Fai Tong

Got it. That's helpful. And then you mentioned certification testing is the best indicator of data center activity. As you look across our distribution, our conversion, liquid cooling, what determines whether the current demand becomes a multiyear testing and certification opportunity versus a concentrated initial certification cycle?

Jennifer Scanlon

Yes. I think the way to think about it is I always say our certification testing business, to some degree, is a function of the amount of innovation and R&D that our customers are investing. And so again, it's the megatrends that they're really focused on -- so -- and in the data center space, what's really interesting is, I would say, equipment and a data center tends to last a few years, let's call it, 3 years and then they're hot swapping different pieces out, and that can require changes to the cooling system, changes to the underlying servers and chipsets, the thermal dynamics that are around it and the amount of power that's needed I think our customers are looking at data centers in particular, but all of these megatrends.

In so far as it's an evolution, you've got version 1 of a product, and then you know that somebody is going to leapfrog you in that, and so you're going to have version 2 and version 3. The beauty of it being requiring certification testing is then that becomes the fuel for continued ongoing certification services and growth in that recurring revenue stream for us as well.

Operator

There are no further questions at this time. I would like to turn the floor back over to Jenny Scanlon for closing comments.

Jennifer Scanlon

Thank you, everyone, for joining us today. And as always, we appreciate your support, and we look forward to updating you on our progress next quarter.

Operator

This concludes today's teleconference. You may disconnect your lines at this time. Thank you for your participation.