TE Connectivity Earnings Call Transcripts
Fiscal Year 2026
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AI and data connectivity orders are up 70% this year, fueling strong growth into 2027. Energy and industrial segments are expanding rapidly, with mid-teens growth in North America and double-digit gains in automation and renewables. Content growth in automotive and commercial vehicles is driven by data, electrification, and new features.
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Strong Q3 results were driven by broad-based growth across industrial, transportation, and AI/data markets, with significant order momentum and margin expansion. Investments in engineering, new facilities, and targeted acquisitions are reinforcing competitive advantages, while robust free cash flow supports both growth and shareholder returns.
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Q3 delivered strong double-digit sales and EPS growth, driven by AI, data, and power trends, with record orders and backlog supporting robust guidance for FY26 and FY27. Strategic acquisitions and investments in connectivity and power further strengthen growth prospects.
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Growth is accelerating across AI, data centers, energy, and automotive, with strong momentum in Asia and North America. Margin expansion is driven by operational leverage and price actions, while capital is allocated to dividends, buybacks, and targeted M&A.
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Q2 delivered 15% sales growth and 24% earnings growth, with record orders and strong performance across all segments. Outlook remains robust, with Q3 sales and EPS expected to rise double digits year-over-year, supported by continued AI and energy market momentum.
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Q1 delivered 22% sales growth and record orders, with strong performance in both segments and robust cash generation. AI revenue outlook was raised by $200 million, and CapEx is increasing to support program wins. Margin expansion and above-target growth are expected for fiscal 2026.
Fiscal Year 2025
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Management raised its long-term growth target to 6%-8% annually, driven by industrial and transportation megatrends in AI, energy, and vehicle electrification. The company expects to double its AI/cloud business in two years, maintain double-digit EPS growth, and deploy capital with a disciplined, high-ROIC approach.
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Record sales, earnings, and free cash flow were achieved, led by strong growth in AI, energy, and data connectivity. Both segments delivered 20% adjusted margins, with robust outlook for FY26 and continued capital deployment for growth.
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Q3 delivered record sales and adjusted EPS, driven by strong AI, energy, and industrial growth, with robust margins and cash flow. Outlook remains positive with double-digit growth expected in Q4 and continued momentum into FY26, supported by strategic investments and acquisitions.
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The company is leveraging strong growth in AI, EV, and energy infrastructure, with rising content per vehicle and robust expansion in Asia. Margins are improving, free cash flow conversion exceeds 100%, and recent M&A is focused on industrial and energy. Innovation, local presence, and portfolio optimization underpin resilience and growth.
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Second quarter sales and earnings exceeded guidance, driven by strong industrial and AI-related growth, while Transportation remained mixed with regional disparities. Tariff impacts are being mitigated, and the Richards acquisition strengthens the Energy segment. Free cash flow and capital returns remain robust.
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Q1 FY25 delivered flat sales but record adjusted margins and EPS, with strong free cash flow and robust order growth, especially in industrial and AI-driven segments. Currency headwinds and regional unevenness persist, but sequential growth is expected, supported by strong execution and recent acquisitions.
Fiscal Year 2024
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Q4 and FY24 results exceeded guidance with record margins, EPS, and free cash flow, driven by strong AI and Asia performance. FY25 outlook calls for continued growth, margin expansion, and robust capital returns, with Asia and AI as key drivers.
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Third quarter results showed strong margin and EPS expansion, with $4B in sales and record free cash flow. AI-driven growth in Communications and stable Automotive performance offset industrial market weakness. Full-year EPS is expected to rise 12% year-over-year.