Josh Chen

Josh Chen asked for details on UL Solutions' exposure to data centers, including specific business areas involved and the total size of this exposure. He also inquired about the historical source of 'excess costs' that the broader expense reduction initiative is targeting, and what factors are now enabling these costs to be removed.

Answer

CEO Jennifer Scanlon described data center exposure through safety challenges related to rapid energy evolution, power infrastructure, AI compute density, thermal environments, and innovations in DC systems and cooling, noting UL Solutions' active focus on this growth area. CFO Ryan Robinson stated that more details on the expense reduction program, with the majority of cost reductions expected in the testing, inspection, and certification businesses, would be provided later.

Josh Chen asked for a triangulation of UL Solutions' business areas that touch data centers and an estimate of the total exposure. He also inquired about the historical source of 'excess costs' enabling the broader expense reduction initiative and what factors are now allowing these costs to be removed.

Answer

CEO Jennifer Scanlon explained that while total exposure isn't quantified, UL Solutions is deeply involved in data center safety challenges, including rapid energy evolution, power infrastructure, AI compute, GPU density, thermal management, and new cooling methods. CFO Ryan Robinson stated that more details on the expense reduction program would be provided later, but anticipated the majority of restructuring expenses and cost reductions would be in the testing, inspection, and certification businesses (Consumer and Industrial).